Tax alert – VAT tax changes

On August 29, 2025, Ordinance no. 22/2025 for amending and supplementing Law no. 227/2015 on the Fiscal Code was published in the Official Gazette no. 806.

Among the most important changes we mention the following:

I.  Provisions transposing EU Directive 2020/285 into the Fiscal Code

a.  Increase of the threshold for applying the small business regime

Starting with September 1, 2025, the VAT exemption ceiling increased to RON 395,000. The exemption applies until the date the threshold is exceeded, including the transaction by which the ceiling is exceeded. Taxable persons exceeding the threshold of RON 395,000 are required to:

• apply for VAT registration on the date the threshold is exceeded;

• apply, as of this date, the normal taxation regime.

Turnover of RON 395,000 no longer includes operations where the place of supply is outside Romania.

b.  Transitional rules on the modification of the VAT registration ceiling

Taxable persons who exceeded the previous exemption threshold of RON 300,000 before September 1, 2025, may request removal from the VAT register in order to apply the special exemption regime, provided they have not exceeded the new RON 395,000 threshold by the date of the request.

c.  Procedure for companies that did not apply or applied late for VAT registration

If a taxable person finds that they have failed to apply or applied late for VAT registration, said person should:

• request VAT registration effective from the date the threshold was exceeded, or request amendment of the registration date so that it corresponds to the date the threshold was exceeded, as the case may be

• calculate the VAT payable or refundable (the difference between the VAT that should have been collected and the VAT deductible) for the period in which they should have applied the normal regime. These amounts must be included in the first VAT return submitted after registration or amendment, or in a subsequent return.

If the tax authorities establish that the taxable person failed to apply or applied late, they will register the taxpayer ex officio or adjust the registration date and determine the VAT payable or refundable.

d.  Application of the small enterprise scheme in other Member States

A taxable person established in Romania may apply the small enterprise exemption in another EU Member State if all of the following conditions are met:

• Annual EU-wide turnover does not exceed EUR 100,000 in the current and previous calendar year.

• Supplies of goods and services in that Member State do not exceed the local exemption threshold for established taxable persons.

Annual EU-wide turnover is calculated as the total annual value, excluding VAT, of all supplies of goods and services within the EU.

This regime applies based on notifications submitted to the Romanian tax authorities.

The competent authority assigns the taxable person an individual identification code for this purpose, which may be the existing Romanian VAT code or, if applicable, the tax identification code with the suffix “EX.”

If the threshold is exceeded in another Member State, the taxpayer must notify the competent authority within 15 days.

e.  Application in Romania of the special regime for small enterprises by economic operators from other EU member states

The small enterprise exemption may be applied in Romania by operators established in other EU Member States, under similar conditions applicable to Romanian taxable persons applying the exemption in another EU Member State.

II.  Changes regarding the place of supply of services

When participation in an event takes place exclusively in the virtual environment, the place of provision of access services to cultural, artistic, sporting, scientific, educational, entertainment or other similar events, including fairs and exhibitions, as well as ancillary services related to such access, is no longer considered to be where the event actually takes place. In these situations, when the beneficiary is a taxable person, the general B2B rule applies, and the place of supply is considered to be the state in which the beneficiary is established.

In the case of services provided to non-taxable persons, the place of supply is the place where the beneficiary is established, has his permanent domicile or habitual residence.

III.  Suspension of e-VAT obligations

Between September 1 and December 31, 2025, pursuant to Article V of Ordinance 22/2025, the transmission of verifications regarding differences reported by the RO e-VAT Compliance Notification is suspended. No penalties will be applied during this period.

The amendments introduced by Ordinance 22/2025 entered into force on September 1, 2025.

Disclaimer

The information contained in this newsletter is intended to give you an overview of new legislation; the newsletter does not contain a comprehensive analysis of each topic. For further information on the topics covered please contact us. No responsibility is accepted for decisions or omissions following the use of the content of this newsletter. All Crowe newsletters are available at the address www.crowe.ro.

Crowe România