Regulation
An event regulation must be drawn up, containing these essential contents:
who is the person Promoting the transaction (or the subjects, if more than one) and who is the possible Delegated entity;
the duration of the transaction, not exceeding 5 years (participation period);
the territory in which the transaction is valid (for example: national territory excluding the Republic of San Marino; or: Lombardy and Veneto);
the procedures for carrying out and awarding prizes;
the prize pool: description and cad. value of the prizes, expected estimate of the amount of prizes that will be awarded;
the deadline within which the prizes will be awarded to those entitled (no more than 180 days from the award).
The regulation must be drawn up in the form of a declaration in lieu of a notary document with a notarized signature by the legal representative of the promoter; it must be kept at the headquarters of the promoter for up to 12 months after the conclusion of the initiative.
Deposit to guarantee the prizes
If the secure gift is not delivered at the time of purchase but sent later, the Promoter must provide a deposit equal to 20% of the estimated value of the prize fund indicated in the regulation (net of VAT) in favor of the Ministry of Economic Development.
The deposit can be:
The deposit, complete with certified signatures and a 16.00 Euro stamp, must be registered to MIMIT. The deposit must expire 1 year after the end of the event, including the date of assignment and any recovery drawings.
Communication to MIMIT
It is necessary to forward the notice of the start of the event (OP/1) attaching the deposit to the Ministry of Enterprises and Made in Italy no later than the day before the start of the initiative.
Award of prizes
Prizes can be awarded even after the purchase, thanks to an online system that records participations.
Although the legislation does not expressly require it, it is advisable to prepare an expert report on this system that certifies its security and that certifies the allocation of the server on Italian territory.
Using WINK you will receive the complete documentation in a couple of days, already in the phase before the start of the event.
Payment of taxes
The expected cost of a prize transaction, in terms of tax obligations, isVAT deductibility (but deductible) on the purchase invoices of the prizes up for grabs (whether they are products or services).
The amount of VAT not deducted depends on the VAT rate of the product or service that constitutes the gift of the promotion. For products or services that are not subject to VAT, the promoting company must pay a replacement tax equal to 20% of the purchase price (e.g. discount coupons, shopping vouchers, gas vouchers)
This group includes the following products and services:
not taxable for VAT purposes;
not relevant for VAT purposes or outside the scope of VAT (e.g. discount coupons, shopping vouchers, gas vouchers);
exempt from VAT (e.g. insurance policies);
that do not have a separate tax charge on the invoice (e.g. tourist packages).
The tax is not due, as a doubling of the tax would occur, in the following cases:
VAT deductible at the origin (e.g. cars, hotel services);
prizes purchased by exempt individuals pursuant to art. 10 Presidential Decree 633/72.
In the event that the prize transaction is intended for Trade instead of Consumption, a withholding personal income tax of 25% on the total value of the prize fund excluding VAT. In the event that an income relationship exists between the organizing company and the winner (e.g. employees, agents, intermediaries, self-employed proxies, etc.), it is mandatory to carry out retaliation; in addition, ordinary taxation prevails, so the prize constitutes income in kind.
Prize delivery
The delivery of the prizes must comply with the provisions of the Competition Rules, and in any case take place within 180 days from the date of assignment. It is necessary to keep the documents certifying the delivery of the prizes and/or the acceptance releases signed by each winner, as they will be required at the closing of the initiative.
Closing of the competition
At the end of the transaction, the promoter must send the MoED a declaration in lieu of a notary document, with the notarized signature of the legal representative, stating that the prize transaction was concluded regularly and that all the prizes were awarded to those entitled within the time limits.
A copy of an identity document of the legal representative must be attached to the declaration. At that point, the guarantee will be released.
