Italy and San Marino: Steps to Clearance Customs Regimes?

Gabriel Pezzato
July 8, 2021

Since 1993, supplies performed between Italy and San Marino have been accompanied by a set of customs obligations. These include the submission of paperwork to both countries’ tax authorities.

After the introduction of the Italian e-invoicing mandate in 2019, Italy and San Marino started negotiations to expand the use of e-invoices in cross-border transactions between the two countries. Those negotiations have finally bore fruit, and details are now available.

Building SDI connectivity to San Marino

Italy and the enclaved country of San Marino will abandon paper-based customs flows.

The Italian and Sammarinese tax authorities have decided to implement a “four-corner” model, whereby the Italian clearance platform SDI will become the access point for Italian taxpayers, while a newly created HUB-SM will be the SDI counterpart for Sammarinese taxpayers.

Cross-border e-invoices between the countries will be exchanged between SDI and HUB-SM. The international exchange system will be enforced on 1 July 2022, and a transition period will be in place between 1 October 2021 and 30 June 2022.

FatturaPA: The format of choice

HUB-SM’s technical specifications are now available for imports from Italy to San Marino, and exports from San Marino to Italy. The countries have also decided to choose FatturaPA as the e-invoice format, although content requirements for export invoices from San Marino will slightly differ from domestic Italian FatturaPA e-invoices.

The SDI and HUB-SM systems will process e-invoices to and from taxpayers connected to them, or under each country’s jurisdictions.

In other words, Italian taxpayers will send and receive cross-border invoices to or from San Marino via the SDI platform, while Sammarinese taxpayers will perform the same activities via HUB-SM.

Both platforms will deliver invoices to the corresponding taxpayers through the Destination Codes assigned by the respective tax authorities. This means HUB-SM will also assign Destination Codes for Sammarinese companies.

Integration documents for Sammarinese companies

Inspired by the Italian methodology for fiscal controls in cross-border transactions, San Marino will require Sammarinese buyers to fill out an additional integration document (similar to a “self-billing” invoice created for tax evidence reasons) upon receipt of the FatturaPA. This document will be filled out in a new XML-RSM format created by the enclave and sent to HUB-SM.

After the larger rollout of the SDI for B2B transactions in 2019, the platform has proven capable of adapting to new workflows and functionalities.

Since last year, e-purchase orders from the Italian National Health System have been exchanged through the NSO, an add-on to the SDI platform. In January 2022, the FatturaPA replaces the Esterometro as a cross-border reporting mechanism.

SDI has already debuted in the international arena through the acceptance of the e-invoices following the European Norm, which are mapped into a FatturaPA before being delivered to Italian buyers. This integration between SDI and HUB-SM might also reveal the early steps of interoperability between both tax authorities’ platforms for cross-border trade.

Take Action

Get in touch with our experts who can help you understand how SDI and HUB-SM will work together.

Download VAT Trends: Toward Continuous Transaction Controls to find out more about the future of tax systems around the world.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.

Author

Gabriel Pezzato

Gabriel Pezzato is a Senior Regulatory Counsel at Sovos. Based in Stockholm and originally from Brazil, Gabriel’s background is in tax, corporate and administrative law. Gabriel earned a Law degree and a specialization degree in Tax Law in his home country and has a master’s degree in International and European Tax Law from Uppsala University (Sweden).
Share this post

North America Tax Information Reporting
September 21, 2023
Sovos Education Returns to Orlando with Statutory Accounting CPE

If you didn’t join us in D.C. or San Francisco earlier this year, you won’t want to miss one last opportunity in 2023 to take part in live continuing education. Sovos Education is returning to the Orlando area for a full week of statutory accounting CPE opportunities and we’re hoping to see you there. Sun […]

North America ShipCompliant
September 20, 2023
Prevent Consumer Confusion Around Hard Versions of Soft Drinks

A trend of the last few years has been the surge in new products entering the beverage alcohol market, from hard seltzers to RTD cocktails, along with the entry of well-established, traditionally non-alcoholic brands, like Hard Mountain Dew and Simply Spiked. While the growth of hard soft drinks is great for consumers, who benefit from […]

North America Tax Information Reporting
September 19, 2023
Form 1042 (and 945) Returns Electronic Filing Requirement Updates

We’ve previously discussed how the IRS released final electronic filing requirements for information returns effective with 2023 returns. One of those key changes is that businesses can no longer submit Form 1042 withholding tax returns on paper starting with tax year 2023 filings and beyond. But how will that actually impact businesses for the upcoming […]

EMEA VAT & Fiscal Reporting
September 18, 2023
Intrastat Thresholds: Current Exemption Values

Intrastat thresholds are value thresholds which decide if companies in an EU Member State qualify to file a return to tax authorities, based on their intra-community trading. These thresholds change annually, prompting businesses to conduct an annual recalculation to know their obligations. This blog contains all the Intrastat reporting thresholds for 2023, as well as […]

EMEA VAT & Fiscal Reporting
September 18, 2023
Intrastat Guide: Reporting, Numbers, Thresholds

Intrastat is an obligation created in 1993 that applies to certain businesses that trade internationally in the European Union. Specifically, it relates to the movement of goods – arrivals and dispatches – across EU Member States. The requirements of Intrastat remain similar across the EU, though certain Member States have implemented rules differently. As a […]