Legal & Tax Updates

Government Decision no. 77/2014 amending and completing the Methodological Norms for the application of Law no. 571/2003 regarding the Fiscal Code was published in the Official Gazette 108/2014

We hereby mention the main amendments and completions:

Corporate Income Tax

• Expenses with losses from receivables representing the difference between the nominal value and the acquisition cost of receivables taken over through assignment are deductible for profits tax purposes
• Dividends received by a Romanian legal entity from a foreign legal entity established in a non-EU country with which Romania has concluded a double tax treaty are considered non-taxable incomes if the Romanian legal entity has available the following documents:
  • tax residency certificate of the foreign entity;
  • sole responsibility statement issued by the non-resident entity certifying that the latter is subject to profits tax in the respective state;
  • documents attesting that the condition regarding the minimum holding of 10% of the share capital is met
• Clarifications are brought with respect to the recovery of sponsorship expenses that were not deducted from the owed profits tax. Also, the term “turnover” is defined for the categories of taxpayers that do not have such element in their financial statements
• Clarifications regarding the computation, declaration and payment of corporate income tax by taxpayers that have opted for a financial year different from the calendar year are introduced

Microentreprises Income Tax

• The Norms bring clarifications regarding the computation of the taxable base for taxpayers that owe micro-enterprises income tax

Withholding Tax

• The term “international transport” is defined as any transport activity performed by a company specialised in international transport, as well as any ancillary activities connected with the latter that do not represent stand-alone activities

VAT

• Clarifications are brought with respect to the cases under which the activity performed by a person is considered to be dependent
• The provisions regarding the VAT cash deferment system are updated, following the removal of the obligation to apply such system by the taxable persons whose turnover is below lei 2,250,000 and the removal of the 90 days deadline to collect the tax
• The annulment of the agreements for supply of goods would not give rise to a new supply of goods from the buyer to the initial seller. As regards the agreements for supply of services, such may be annulled only for future services
• The non-resident taxable person which has no obligation to register for VAT purposes in Romania would provide to its beneficiary with the invoice prepared as per the legal provisions, without mentioning its Romanian VAT code, as well as with the copy of the decision regarding the payment of the VAT related to the operations carried out, in order to deduct the related VAT
• According to the provisions of the 9th and 13th Directive, the foreign taxpayers may request the reimbursement of the VAT amounts inscribed within the invoices related to 1 January 2009-31 December 2013 which were not paid. The VAT reimbursement request should be submitted by 30 September 2014
• The taxable person has the obligation to prove the destruction, loss or theft of property, as to maintain the VAT deduction related to these goods. The tax authorities may not require to the taxable person more than what it is necessary to prove these facts, so that the taxpayer burden would not become impossible or extremely difficult
• Taxable persons for which the VAT registration was canceled but meet the requirements to be VAT re-registered, will be assigned with the VAT registration code which was initially allocated to them
• The tax receipts issued as per the legal provisions will be inscribed within the sales ledgers by the taxable persons VAT registered which apply the VAT cash deferment system

Excises

• The Ministry of Public Finance is required to communicate on its website the manner of determining the value in RON for the excise tax on crude oil from the domestic production as per the provisions of art. 218 of the Fiscal Code, no later than the 20 th of October for each year
• The chargeability of non-harmonised excise duties in case of products shipped under a consignment agreement occurs after the goods are delivered to the clients
• It is provided that the chargeability of excise duties in case of electricity consumption for the own use occurs upon consumption, the economic operators authorised in the field of electricity being obliged to issue a self-invoice
• The retention period of excisable goods in the reception place by the authorised final user is reduced from 48 to 24 hours
• The documents to be submitted by proposed warehouses keepers in order to obtain the tariff classification of the finished products as well as the classification within the excisable goods nomenclature codes are established