Tax alert – modifications to the Fiscal CodeKreston Romania
Minister of Public Finances Order no 77/2014 to amend Methodological Norms for application of the Fiscal Code, was published into Official Gazette no 108/12.02.2014
The main provisions are:
Expenses representing receivable losses, recorded as a result of adjusting receivables taken over by assignment from their nominal value to the acquisition cost, are deductible for corporate tax purposes.
The dividend income obtained by Romanian companies from foreign companies is tax exempted in certain conditions, provided that the following supporting documents are provided:
a) the fiscal residency certificate of the foreign entity;
b) the statement of the foreign entity regarding the fact that the entity is recorded as profit tax payer;
c) documents to prove the fact that the Romanian company holds at least 10% of the shares for at least 1 year.
The way to deduct the sponsorship expenses in the following 7 year is clarified in details and with examples.
The way to calculate the corporate tax for companies with not classic fiscal year is clarified in details and with examples.
All companies recording a revenue lower than 65,000 Euros in 2013, of which less than 20% from management and consulting services will be considered micro companies in 2014.
The calculation of the taxable base is clarified.
If a company chooses to apply the VAT cash system, the system will apply to all transactions less the ones with the place of delivery outside Romania.
Calculation of the turnover limit in order to apply the cash VAT system is clarified and the consequences in case the limit is exceeded, the moment of payment in case of transfer of receivables it is clarified, or use of alternative payment methods (such as netting).
The companies applying the cash VAT system must show the fiscal receipts issued by electronic cash registrar in the sales ledger, according to the details in the daily reports as provided by Ordinance of the Government no. 28/1999.
The term “cancelation of agreement” is defined in the context of the provisions regarding the events that allows the VAT adjustment.
The conditions that the VAT is not adjustment in case of stolen assets or assets lost due to natural disaster or similar events are clarified.
The authorized agents using electricity for their own supply must issue a self invoice at the moment of the consumption.