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Amendments to the Tax Code
The Ordinance no. 25/2017 amending and supplementing the Law no.227/2017 concerning the Tax Code was published in the Official Gazette no. 706 of 31.08.2017.
Corporate tax
A new category of expenses whose deductibility is limited was added. Thus, the expenses representing the amount of alienated receivables, according to law, will be deductible up to a ceiling of 30% of the amount of alienated receivables.
These provisions shall apply starting from 1 January 2018.
Income tax
The definition of the income from independent activities is supplemented in the sense that it is considered: income obtained from independent activities carried out in Romania, except for intellectual property rights, whether received from Romania or from abroad.
The income from intellectual property rights is considered to be obtained in Romania only if it is received from a payer of income in Romania or from a non-resident through its permanent establishment set up in Romania.
The amounts or benefits received by natural persons from dependent activities carried on board the aircrafts operated in international traffic, with some exceptions, are entered in the category of income for which no salary tax is due.
Both in case of determination of the tax on the income from rental and leasing activities based on the annual standard income and in real system in the event of cessation or temporary suspension of the activity during the year, the taxpayer shall notify the event to the relevant tax authority within 30 days from the date of its occurrence, in order to recalculate the payments established to the account of the annual tax due.
The taxpayers who receive income from other sources, as defined in the Tax Code, for which the tax cannot be withheld, as well as income obtained from the assignment of debts, both by the assignor and the assignee, must submit a statement on the obtained income until May 25 including of the year following the year when the income was obtained.
These provisions shall apply starting from 1 January 2018.
Mandatory social securities
The medical services provided in the form of subscription borne by the employers for their own employees within the limit of EUR 400/year/employee are not included in the monthly calculation basis of the mandatory social securities.
These provisions shall apply starting from 3 September 2017.
The tax on the income obtained in Romania by non-residents and the tax on the representative offices of the foreign companies established in Romania
The tax on the representative office is owed by any foreign legal entity which has a representative office authorized to operate in Romania according to law. The tax is annually paid and the amount payable for a financial year is of Lei 18,000.
The representative office of a foreign legal entity/entities must declare and pay the tax on the representative office to the state budget until the last day of February including of the taxation year.
Also, changes related to the tax payment and the submission of the tax return in case of a representative office of a foreign legal entity/entities established/closed down in Romania during a month of the taxation year are made.
The provision according to which the representative offices are obliged to carry out the bookkeeping stipulated by the Romanian legislation in force remains unchanged.
These provisions shall apply starting from 1 January 2018.
Excise duties
The excise duties related to the energy products - gasoline and diesel - will increase gradually since 15 September 2017 and 1 October 2017 as follows:
These provisions shall apply starting from 15 September 2017. -
Amendments to the Tax Procedure Code
The Ordinance no. 30/2017 amending and supplementing the Law no.207/2015 concerning the Tax Procedure Code was published in the Official Gazette no. 708 of 31.08.2017.
The provision concerning the obligation to submit documents in Romanian or accompanied by certified translations is supplemented. A penalty in case when the requests, the supporting documents, the certificates or the documents drafted in a foreign language are submitted without being accompanied by translations into Romanian is introduced.
Thus, the legal text stipulates that, upon request of the tax authority, the taxpayer is required to submit certified translations of the above mentioned documents, and in their absence, the documents submitted are not taken into consideration by the tax authority.
The taxpayers who carry out liberal activities will be responsible for the tax liabilities due, in addition to the goods from the dedicated assets, with the goods from their personal assets.
A new case of entailing the joint liability with the debtor, of the issuer of the letter of guarantee/ guarantee insurance policy or of the institution which confirmed the letter of guarantee/guarantee insurance policy if it did not pay, according to law, the amounts of money to the accounts of the budgetary revenues at the request of the tax authority is introduced.
In addition, the new normative act stipulates that the persons who determined in bad faith the accumulation of such liabilities and the evasion from their payment are also jointly liable with the debtor for the debtor's outstanding tax liabilities for which the opening of the insolvency proceedings was requested.
An exception to the rule of communication of the administrative act in hard copy by mail, by registered letter with acknowledgment of receipt, namely the remittance of the document issued on paper, under signature, to the tax domicile of the taxpayer, by the own employees of the tax authority, is introduced. In case when the addressee refuses to receive the document or is not found at the tax domicile, a notice will be displayed on his/her door.
The taxpayer/payer is entitled to go to the headquarters of the issuing tax authority within maximum 15 days from the date of display of the notice in order to be communicated the act, otherwise the act is deemed to be communicated when this term is reached.
The obligation for the credit institutions to request to the tax authorities to assign the tax identification number/tax registration code for non-resident natural persons or for legal persons who do not have an identification code at the time when they request the opening of a bank account or the rent of a safe deposit box is imposed.
The obligation of the taxpayer/payer to declare to the central tax authority the establishment of the secondary offices within 30 days from:
i. the date of registration / their mention to the trade registry or to other registries where the entity which established them was registered;
ii. the date of the establishment act in all other cases in which the first option is not applicable.
is regulated.
Regarding the submission of the tax return, it was expressly stipulated that in the event that it was registered with a non-competent tax authority, it is deemed to be submitted on the date of its registration with the non-competent tax authority and it will be sent to the competent tax authority within 5 working days from the registration date.
According to the new amendments, the tax authority has the opportunity to select the periods which will be subject to tax inspection without having to check the entire period for which the reserve of the further verification is open, but with the possibility of extending the inspection for other unverified periods as well.
The possibility that the activity carried out by the central or local tax authority during a tax control to be also represented by prevention and compliance actions is introduced.
Regarding the tax receivables administered by the central tax authority for which the taxpayer/payer submits the main amended returns in relation to the differences in the tax liabilities, the payment deadline of the differences is the date of submission of the amended return to the tax authority.
It is expressly regulated that the delay penalty does not apply to the main tax liabilities for which the non-declaration penalty is due.
Regarding the payment schedule, the ordinance has brought a series of amendments related to the extension of some deadlines for the taxpayer/payer, as well as the possibility of requesting and approving the differentiated payment of the scheduling rates.
The possibility for the debtor to make a request for the mention of the scheduling whose validity was lost due to the non-compliance with the provisions of art. 194 para. (1) letters a) - j) and l) once during a year of scheduling, provided that such request is made before the enforcement of the guarantee by the competent authority or before the discharge of the payment obligations, is also foreseen.
The possibility of granting the payment schedule of the tax liabilities on whose payment the maintenance of the authorization, the agreement or other similar administrative act such as excise duties depends, is removed.
In case of the guarantees established with the purpose of lifting the precautionary measures, the normative act stipulates that they must be maintained throughout the entire period of validity during which the precautionary measures would have been maintained according to law. If the debtor does not extend their validity period, the tax authority has the possibility to enforce these guarantees on the last day of their validity.
The deadline for establishing the garnishment of the amounts in the bank accounts is reduced from 30 days to 15 days.
The possibility of guaranteeing the tax liabilities by a letter of bank guarantee issued by a non-banking financial institution entered in the registries of the National Bank of Romania for the issuance of guarantees is introduced.
A new provision according to which the foreclosure is suspended or does not start for the tax receivables established by a decision issued by the tax authority in case when the debtor notifies the tax authority, following the communication of the decision, of its intention to submit a letter of guarantee or insurance policy, was added.
Also, the normative act stipulates that, during this period, the tax receivables established by the taxation decision issued by the tax authority are not paid off. If the debtor does not submit the letter of guarantee or the insurance policy within 45 days from the decision notification date, the foreclosure continues or starts according to law.
The ordinance stipulates that for the receivables established by judicial decisions issued in criminal matter, resulting from the offenses committed (i.e. the amounts of money representing compensation for material damage, fines, legal expenses or amounts seized), the foreclosure measures stipulated by the Tax Procedure Code shall apply and the enforcement body will not issue any other enforceable title.
In the event that the courts of law order the suspension of the execution of the tax administrative act, all its legal effects are suspended until the end of the suspension. It was also expressly stipulated that these legal effects concerned both the main obligations individualized in the administrative act suspended, as well as the accessory tax liabilities individualized in other administrative acts which are not suspended upon execution.
The paragraph (6) was inserted in art. 278, according to which in case when a request for suspending the tax administrative act was made under Art. 14 of Law no. 554/2004 and the guarantee associated with it has already been registered to the court of law, the registration of a new guarantee is no longer necessary in case when the suspension of the administrative act is requested under art. 15 of Law no. 554/2004 as long as the guarantee is actually registered to the court of law.
Any presented information is general and is not meant to address the specific conditions of a particular individual or legal person. Although we try to provide accurate and up-to-date information, there is no warranty that such information is accurate at the time of its receipt or that it continues to be accurate. No action should be taken based on this information without relevant professional assistance following a careful examination of the circumstances that are typical of a particular state of affairs.
