Italian E-Invoices for Foreign Companies 2026: SDI, FatturaPA & Compliance
If you do business with Italian clients or suppliers, invoicing may not work as it does at home. Italy routes invoices that fall within its domestic e-invoicing mandate through the Sistema di Interscambio (SDI). Whether you are a US LLC selling services to an Italian client, a UK company buying from an Italian supplier, or a foreign group opening a local entity, the first question is who is resident or established in Italy and therefore responsible for SDI transmission.
This guide covers what foreign companies need to know about Italian Fattura Elettronica (electronic invoicing) in 2026: how the SDI works, the FatturaPA XML format, compliance deadlines, penalties for non-compliance, and how to receive e-invoices without an Italian VAT number. If you're just getting started with the fiscal side of things, our guide on opening a company in Italy or getting a Partita IVA as a foreigner covers the groundwork this article builds on.
What Is the Sistema di Interscambio (SDI)?
The SDI is Italy's e-invoice interchange platform managed by the Agenzia delle Entrate. Since 1 January 2019, invoices for transactions within the domestic mandate — principally supplies between parties resident or established in Italy — are issued as FatturaPA XML and transmitted through the SDI. The platform performs formal, structural and consistency checks before delivery.
The SDI checks whether the file follows the current XML schema, whether required identifiers and fields are present, whether document and recipient codes are admissible, and whether certain totals are arithmetically consistent. Passing those checks confirms that the file can move through the system; it does not certify that the underlying VAT treatment, deduction or commercial facts are substantively correct.
If a check fails, the SDI rejects the file (scarto) and notifies the sender, who must correct and resubmit it. For invoices between parties resident or established in Italy, art. 1(6), D.Lgs. 127/2015 is explicit: a document issued outside the SDI "si intende non emessa" and the penalties of art. 6, D.Lgs. 471/1997 apply. Cross-border invoices are the exception: there the paper/PDF copy is not an e-invoice at all, and the Italian party's duty is to report the data through the SDI (see below).
Why This System Exists
Italy introduced the SDI to reduce VAT fraud and shorten the delay between invoice issuance and tax-authority access to invoice data. The Agenzia delle Entrate receives the transmitted information when the file is submitted, but substantive tax checks may occur later and may use returns, periodic VAT communications and other records.
For foreign companies, the practical point is to identify the Italian party's transmission duty promptly rather than treating the invoice as a year-end bookkeeping issue.
How the SDI Works: Step by Step
Here's what happens when a supplier issues an e-invoice in Italy.
The supplier generates the invoice with accounting software or a service provider, converts it to FatturaPA XML and sends it to the SDI. The platform checks the schema, transmission format, required fields, identifiers, document and recipient codes, and specified arithmetic consistencies. Acceptance is not an opinion on the correct VAT treatment or the truth of the transaction. If a check fails, the scarto notice goes to the sender, who must correct and retransmit the file; the buyer is not necessarily notified by the SDI.
FatturaPA is Italy's mandatory XML schema for electronic invoices. It's not a pretty PDF with some data fields. It's a structured XML file with over 200 possible fields organized into two main sections: the Header and the Body.
The Header contains the supplier (CedentePrestatore) and recipient (CessionarioCommittente) details: VAT numbers, fiscal codes, legal names, addresses, and the recipient's seven-character SDI code. It also declares the transmission format — FPR12 for invoices between private-sector operators (B2B and B2C), FPA12 for invoices addressed to public bodies — and the document type code: TD01 for a standard invoice, TD04 for a credit note, TD16 for an internal reverse-charge integration, TD18 for an intra-Community purchase of goods (TD17 is the integration/self-invoice for services bought from abroad), or TD24 for a deferred invoice (goods documented by transport documents in the same month).
The Body contains the actual transaction data: line items with descriptions, quantities, unit prices, VAT codes (N1 through N6 for different treatment types), payment terms, and the total amounts. The SDI reads every field at machine speed. It doesn't guess. If a required field is missing or formatted incorrectly, the invoice is rejected.
For foreign companies, the most critical fields to understand are the VAT codes. Italy uses specific codes (N1, N2, N3, N4, N5, N6) to indicate different treatments under Italian law. A reverse charge transaction requires a code from the N6 category (inversione contabile). The codes are not generic: N6.1 is the sale of scrap and recyclable materials, N6.2 gold and silver under Law 7/2000 and used jewellery, N6.3 construction subcontracting, N6.4 sales of buildings, N6.5 mobile phones, N6.6 electronic products, N6.7 services in the construction sector, N6.8 the energy sector and N6.9 the residual other cases (Agenzia delle Entrate, Guida alla compilazione delle fatture elettroniche e dell'esterometro, v. 1.10). A code picked by name similarity is a common source of rejection.
Two timing rules matter when you read an Italian invoice. A standard invoice must be issued within 12 days of the operation (art. 21, DPR 633/1972). A fattura differita — the deferred invoice used to group deliveries documented by transport documents in the same month (TD24, art. 21(4), DPR 633/1972) — must be transmitted to the SDI by the 15th of the following month (Agenzia delle Entrate, Guida alla compilazione delle fatture elettroniche e dell'esterometro, v. 1.10, April 2025).
Why This Matters More Than Paper Invoices
Unlike a visual copy, FatturaPA XML is machine-readable and can feed accounting and tax-control processes automatically. The SDI validates the file at transmission; the Agenzia delle Entrate may later compare invoice data with VAT returns, LIPE communications and other information. A delivery receipt therefore proves transmission and acceptance of the file, not substantive tax compliance.
For foreign companies that means you can't "fix it later" at year-end, but the consequence is precise: the transaction still exists — the goods or services were supplied and the commercial debt stands — but it remains undocumented for VAT purposes until a valid invoice is transmitted. The supplier faces the penalties of art. 6, D.Lgs. 471/1997, and the buyer cannot deduct input VAT on a document that is not a valid e-invoice.
Penalties for Non-Compliance
Italian e-invoice penalties depend on the type of violation and have been updated by Legislative Decree 87/2024, effective September 1, 2024 (art. 6 and art. 11, D.Lgs. 471/1997, applicable to violations committed from 1 September 2024):
- Omitted, late or materially incorrect taxable invoice that affects the correct VAT calculation — 70% of the VAT amount connected with the violation, with a minimum of €300.
- If the error does not affect VAT calculation — a fixed penalty between €250 and €2,000.
- For exempt, non-taxable, reverse charge, or non-VAT transactions — 5% of the undocumented amount, with a minimum of €300.
- Cross-border reporting delays (TD17-TD19 documents) — €2 per invoice, capped at €400 per calendar month.
- Purely formal violations (no impact on VAT or income and no hindrance to the tax audit) — no penalty; when a documentation breach has no effect on the VAT due, the fixed €250-€2,000 penalty of art. 6(1) applies instead.
The €2-per-invoice cross-border reporting penalty is halved (capped at €200 per month) if the data is transmitted, or corrected, within 15 days of the deadline (art. 11(2-quater), D.Lgs. 471/1997). Beyond monetary penalties, an invoice that never reaches the SDI is not considered fiscally issued: the buyer holds no valid document and cannot deduct input VAT (Agenzia delle Entrate, FAQ "Sanzioni").
An SDI rejection identifies a transmission problem, while a file that passes may still use the wrong VAT treatment. Review both the technical receipt and the substance of the invoice; do not treat SDI acceptance as a tax audit or as a guarantee that the counterparty's calculation is correct.
Receiving E-Invoices as a Foreign Company (Without an Italian VAT Number)
Foreign companies without a permanent establishment in Italy are outside the mandate for their own invoices merely because they trade with Italy. A branch or other permanent establishment may be established in Italy; an Italian subsidiary is instead a separate Italian-resident company and applies the SDI rules to its own invoices. Direct VAT identification or a fiscal representative alone does not create an establishment.
However, in practice, your Italian suppliers will send you invoices — and you need a way to receive and process them. Here's how it works:
What the Law Says
The Italian Revenue Agency's guidance is that the e-invoice obligation under art. 1(3), D.Lgs. 127/2015 covers operations between parties resident or established in Italy (Agenzia delle Entrate, FAQ "Fatture verso e da soggetti stranieri"). A foreign company does not become established merely because it has an Italian VAT number through direct identification (art. 35-ter, DPR 633/1972) or a fiscal representative. For a sale by an Italian supplier to a non-established foreign customer, the Italian supplier normally transmits the cross-border data through the SDI with recipient code XXXXXXX and gives the customer a readable copy.
This means:
- You are not required to set up your own SDI connection: the transmission duty sits with the Italian supplier, and you receive the invoice copy
- You do not need to register with the SDI as a foreign, non-established buyer
- If you do appoint an intermediary, it is for convenience and faster processing — not because the law requires it for you
Option 1: Receive the Invoice Copy While the Supplier Transmits to the SDI
Since 1 July 2022, data for transactions with non-established counterparties is transmitted through the SDI under art. 1(3-bis), D.Lgs. 127/2015. For an outgoing sale, the Italian supplier normally issues FatturaPA XML with recipient code XXXXXXX within the invoice-issuance deadline and sends the foreign customer a PDF or paper copy. For purchases from a non-established supplier, the Italian customer transmits the relevant TD17, TD18 or TD19 file by the fifteenth day of the following month. The reporting rule does not apply to operations documented by a customs bill, operations already covered by an e-invoice transmitted through the SDI, or non-territorial purchases of goods or services not exceeding €5,000 per individual transaction.
Two conventional recipient codes are worth recognising in the XML:
- XXXXXXX — used for a foreign counterparty in the cross-border XML; the file is transmitted to the SDI but is not delivered to the foreign customer through an Italian recipient channel.
- 0000000 — used in domestic cases where the recipient has no registered telematic address and retrieves the invoice in the reserved Fatture e Corrispettivi area; it is not the normal code for a foreign customer.
Keep the courtesy copy and the underlying contract, delivery and payment records required for your accounting. A PDF copy is not proof by itself that the Italian supplier transmitted a valid XML or that the cost is deductible.
If your Italian supplier insists on sending e-invoices via the SDI, or if you prefer structured XML receipts for your accounting, you can appoint an accredited service provider (intermediario). The intermediary acts as a technical bridge between your accounting system and the SDI, handling XML formatting and the SDI connection. Many Italian accounting firms — including ours — offer this service to foreign clients.
This is not a legal requirement. It is a practical choice that simplifies cross-border invoice processing.
What About Invoicing Italian Clients?
If you are a foreign company selling to Italian clients, your obligations depend on establishment, not merely on holding a VAT number:
- Italian subsidiary: the subsidiary is a separate Italian-resident company and uses the SDI for its own invoices.
- Italian branch or other permanent establishment: the foreign company uses the SDI for supplies attributable to that establishment.
- No Italian establishment: the foreign company invoices under the applicable foreign rules; the Italian business customer generally accounts for Italian VAT through reverse charge or self-invoicing. Mere direct VAT identification or a fiscal representative does not by itself trigger the domestic e-invoice mandate.
For a full breakdown of company structures and their tax implications, our Italian VAT guide covers the ground you need to navigate before invoicing begins.
2026 Update: Automated VAT Assessment for Non-Filers
From 1 January 2026, art. 54-bis.1, DPR 633/1972 allows the Agenzia delle Entrate to liquidate VAT when the annual VAT return is omitted — including a return filed without the schedules needed to calculate the tax. The authority may use automated procedures based on issued and received e-invoices, telematic receipts and LIPE data.
The authority communicates the outcome to the taxpayer, who has 60 days to provide information not considered or to pay. Payment within that procedure reduces the applicable penalty to one third; without a response, the amounts are enrolled for collection. This is a liquidation mechanism for an omitted return, not an SDI certification of each invoice and not a tax return silently "filed for you."
Pre-filled VAT records existed before 2026. The new point is the statutory liquidation procedure for omitted or incomplete annual VAT returns.
2024 Update: E-Invoicing Extended to Forfettario
From 1 January 2024, the remaining turnover-based exclusion for the regime forfettario ended, so forfettario operators are generally within the e-invoicing mandate, subject to the same statutory exceptions that apply to the relevant transaction.
An Italian forfettario supplier selling to a non-established foreign customer normally transmits the XML with XXXXXXX and gives the customer a readable PDF or paper copy. Receiving only the copy is therefore normal and is not a red flag by itself. The useful check is whether the supplier made the required SDI transmission or whether a statutory exception applies.
A Practical Checklist Before Opening a Company in Italy
Here's what you should do before or during any Italian business relationship:
Map each Italian counterparty and identify who has the transmission duty. As a non-established foreign buyer, you do not need your own SDI connection: ask the Italian supplier to confirm transmission with XXXXXXX and retain the copy and supporting records. Appoint an intermediary only if you want structured XML files in your accounting system. Internally, separate a technical SDI receipt from the substantive review of VAT treatment and document type.
Common Mistakes Foreign Companies Make
The most frequent confusion is assuming that you must be connected before an Italian supplier can invoice you. A non-established foreign customer does not need its own SDI channel: the supplier transmits with XXXXXXX and sends a copy. Each party still has its own risks. The supplier must make the required transmission; the buyer should verify the VAT treatment and keep the contract, supply and payment evidence. A scarto means the transmitted file is not a valid invoice until corrected and retransmitted, but it does not by itself alter the contractual payment date.
How YourBusinessInItaly Can Help
As a full-service accounting firm specializing in foreign companies operating in Italy, we support e-invoice compliance through our Tax & Accounting services. We can act as an intermediary, review incoming invoices for technical format and VAT treatment, and help apply the appropriate reverse-charge process for EU and non-EU transactions.
For a complete comparison of business structures and which one suits cross-border invoicing, our SRL vs Sole Proprietorship guide walks through the implications for your specific situation.
Ready to get Italian invoicing right? Contact us to discuss your e-invoice needs.
Frequently asked questions
Can a US LLC receive Italian e-invoices?
Yes. For a sale by an Italian supplier to a US LLC with no Italian establishment, the supplier normally transmits FatturaPA XML to the SDI with XXXXXXX and gives the LLC a readable PDF or paper copy. The LLC does not need its own SDI channel; it may appoint an intermediary if it wants the XML in its accounting workflow. An Italian branch or other permanent establishment follows the domestic mandate for attributable supplies, while an Italian subsidiary follows it as a separate resident company. Direct VAT identification or a fiscal representative alone does not create an establishment.
What if an SDI invoice is rejected?
The supplier receives an error notification from the SDI with the specific error code. The invoice must be corrected and resubmitted. The SDI does not accept "close enough" invoices. The entire file must pass all validation checks. A rejected file is not a valid invoice for VAT purposes, so the buyer cannot deduct input VAT on it. Whether payment is still due depends on the commercial agreement: the Agenzia delle Entrate states that payment terms follow the parties' contracts, while the missing e-invoice must be requested from the supplier (and, if it never arrives, regularised by the buyer under art. 6(8), D.Lgs. 471/1997).
Are there exemptions from e-invoicing?
Since January 2024, forfettario taxpayers are generally within the mandate, but transaction-specific exceptions remain. Retail supplies may be documented by electronic daily receipts where no invoice is requested; healthcare invoices to individuals remain subject to the statutory SDI prohibition; and a non-established foreign company is not brought into the domestic mandate merely by an Italian VAT identification. Cross-border data reporting by the Italian party must still be considered separately.
What's the difference between FatturaPA and a normal PDF invoice?
FatturaPA is a structured XML format that the SDI processes automatically. A PDF is a visual document that humans read. For B2B transactions in Italy, the SDI cannot process a PDF. FatturaPA is the legal requirement. A PDF alone does not satisfy the electronic invoicing obligation.
What are common document type codes in FatturaPA?
Common TD codes include TD01 (standard invoice), TD04 (credit note), TD07 (simplified invoice), TD17 (integration/self-invoice for services bought from abroad), TD18 (integration for intra-Community purchases of goods), TD19 (integration/self-invoice for goods under art. 17(2), DPR 633/1972) and TD24 (deferred invoice for goods documented by transport documents). Some inadmissible combinations cause rejection; a technically accepted code can still be substantively wrong, so SDI acceptance is not enough.
Official sources
Giovanni Emmi|May 13, 2026
