SDI portal in Italy: Everything you need to know

Since January 1, 2019, Italy has implemented mandatory electronic invoicing for all business-to-business (B2B) transactions. This measure affects both Italian companies and branches of foreign companies operating in the country, as well as, to some extent, international transactions. In this article, you will find detailed information about the SDI portal in Italy and how it impacts companies in their tax transactions.

What is the Sistema di Interscambio (SDI)?

The Sistema di Interscambio (SDI) is a platform managed by the Agenzia delle Entrate (Italian Tax Agency) that acts as an intermediary in the transmission of electronic invoices. All invoices must be sent to the SDI, which verifies their format and content before forwarding them to the final recipient. This system ensures the authenticity and integrity of invoices, guaranteeing compliance with Italian tax regulations.

Obligations for Italian companies

All companies registered in Italy are required to issue and receive electronic invoices through the SDI for both B2B (business-to-business) and B2C (business-to-consumer) transactions. Invoices must comply with the FatturaPA format, an XML file that includes detailed information about the transaction, issuer, and recipient. Additionally, invoices must be digitally signed to ensure their authenticity.

All the cases when a company should submit an electronic invoice to SDI

When a company conducts a transaction in Italy, the obligations vary depending on the type of company and its relationship with the client:

Foreign company invoicing a public entity in Italy

In this case, foreign companies are subject to electronic invoicing regulations through the SDI portal.

  • Electronic invoicing requirement: Even if the foreign company does not have an Italian VAT number, it is required to issue electronic invoices to public entities.
  • Issuing electronic invoices: The invoice must be issued in XML FatturaPA format and transmitted via SDI.
  • Technical requirements: The invoice must comply with established technical standards, including digital signatures and the use of the “Codice Univoco Ufficio” to identify the recipient.

Italian company with an Italian client

  • Electronic invoicing requirement: All Italian companies must issue electronic invoices for B2B and B2C transactions.
  • E-invoice format: The XML FatturaPA format must be used and sent via SDI.
  • Validation and retention: The invoice is validated by the SDI before being delivered to the recipient and must be retained for at least 10 years.

Foreign company NOT registered in Italy

  • No electronic invoicing requirement: If the foreign company does not have an Italian VAT number and is not established in Italy, it is not required to issue electronic invoices via SDI.
  • E-invoice format: The invoice can be issued in paper or electronic format (e.g., PDF) according to the regulations of the company’s home country and commercial agreements with the Italian client.
  • Responsibility of the Italian recipient: The Italian client must report the received invoice through the “self-invoicing” or “integration” procedure, ensuring the transaction is correctly recorded in the Italian tax system.
  • Other exchange methods: Since electronic invoicing is widely used in Italy, the Italian recipient may request the non-Italian issuer to use other electronic invoicing processes, such as Peppol.

Foreign company registered in Italy

  • Electronic invoicing requirement: If the foreign company has an Italian VAT number or is established in Italy, it must comply with Italian electronic invoicing regulations.
  • Issuing electronic invoices: The invoice must be issued in XML FatturaPA format and transmitted via SDI.
  • Technical requirements: The invoice must meet established technical standards, including digital signatures and the use of the “Codice Destinatario” to identify the recipient.

Additional considerations

Several other aspects are crucial for properly managing invoices with the SDI portal in Italy. These include:

  • Codice dstinatario: A 7-character code that identifies the recipient’s electronic invoice reception channel. The issuer must obtain this code from the Italian client to ensure the invoice is correctly delivered through SDI.
  • E-invoice retention: Both issuers and recipients must retain electronic invoices for at least 10 years, ensuring their readability and authenticity over time.

Benefits of electronic invoicing

Adopting electronic invoicing through SDI offers multiple advantages:

  • Error eeduction: Automating the invoicing process minimizes manual errors.
  • Operational efficiency: Electronic transmission speeds up document exchange and reduces processing times.
  • Tax transparency: Facilitates control and tracking of transactions by tax authorities, helping reduce tax evasion.

Electronic Invoicing to SDI with B2Brouter

B2Brouter simplifies the electronic invoicing process for companies from any country, eliminating technical and legal barriers. Thanks to its intuitive platform, businesses can generate and send invoices to SDI automatically and in compliance with Italian regulations. This allows both Italian and foreign companies to operate seamlessly, ensuring efficient and secure management of electronic invoices.

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