- The Italian tax authorities have issued Ruling No. 427/2023, providing clarification on the issuance of credit notes in cases where an insurance company indemnifies a policyholder and becomes subrogated to the policyholder’s rights.
- The petitioner, ALFA, is a company that provides commercial credit insurance and debt collection services.
- When ALFA pays the indemnity to the policyholder, it is subrogated to the policyholder’s rights under Article 1916 of the Italian Civil Code.
- In some cases, the policyholder intervenes in the debtor’s insolvency proceedings before ALFA pays the indemnity, while in other cases, the claim is transferred to ALFA before the policyholder intervenes.
- ALFA seeks confirmation from the tax authorities on its ability to issue credit notes for a credit claimed by the policyholder if the debtor fails to pay after unsuccessful insolvency proceedings.
- ALFA believes it can issue the credit note only if the policyholder has not yet intervened in the insolvency proceedings at the time of transfer under Article 1916.
- The tax authorities refer to Article 26 of Presidential Decree No. 633/1972, which allows for the issuance of credit notes in cases where a transaction ceases or the taxable amount is reduced.
- They also cite Resolution No. 120/E/2009, which states that in the case of non-recourse assignment of a receivable claimed in insolvency proceedings, the right to issue the credit note belongs to the assignor/original creditor.
- This is supported by Italian Supreme Court case law.
Source PwC
