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An accurate analysis on the VAT exemptions for Italian nursing homes by the administrative and tax expert Dott. Gianni Mario Colombo, associate of Cahill-Caizzone.


The exemption referred in art. 10, n. 21, D.P.R. 633/1972 for nursing homes, as other services contained in art. 10, is objective because the amount due for such transactions is exempt from VAT, either way.

This type of application is also found in the reply of the Revenue Agency to the 1.07.2019, n. 221 consultancy of a business company, which we are going to address Alfa for convenience.

Alfa’s business activity is the management, among others, of all kinds of care in hospitals, nursing homes, schools and communities in general, both public and private.

With previous practice documents (ris. 8.01.2012, n. 1/E and 16.03.2004, n. 39/E), the Revenue Agency had already clarified that, the legal nature and quality of the individual providing the benefit are irrelevant, because of the objective character of the exemption.

Consequently, the exemption scheme applies both to the fees that the municipality receives from guests and health care companies and to the amounts that the local authority pays to the property management companies, which are based on appropriate conventions.

Given the above, the following services are considered “objectively” exempted (ris. n. 39/E, cit):

  • Services related to the overall management of a nursing home or of a daycare billed by third parties to the municipality, which maintains the ownership of the service towards end-users;
  • Services offered by third parties at daycares and nursing homes, even if they are clearly specified, as long as they configure a total management of these structures. The management’s ownership is retained by the Municipality, and it is limited to an activity of control and direction, in order to guarantee the quality and the collective interest.

The answer, based on the above mentioned practice documents, underlines the assumption that the exemption is possible, as long as Alfa carries out the overall management of the nursing home.

This is normally the case where the ownership of the service remains to the procuring entity, which carries out only a control and direction activity in order to guarantee quality and collective interest.

It is not a rare case in the management of nursing homes.

The holders of the original interests are limited to maintaining the general direction of the work, both because of the failure of some reference individuals (example: religious), and because of the technical complexity of the management.

Then, they leave the management of activities to external sector’s experts (for example, social cooperatives or, as in this case, service companies).

The application of VAT overall services purchased would have made the operation economically unsustainable, heavily influencing guests’ fees and entity’s competitiveness.

In the case that specific and partial services are contracted out (for example cleaning, canteen service, etc.), contracts would be subject to VAT.

An important exception regards nursing and rehabilitation services, which are provided separately from the overall management of the nursing home (ris. 39/E, already mentioned).

However, the exemption is applied even if they are not part of the overall management.

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Cahill-Caizzone & Associates is the Registered Trading name of Cahill Caizzone & Associates Limited, incorporated in Ireland, Reg. No.369596.