In the Official Gazette no. 393 from May 14, 2020, was published the Government Emergency Ordinance no. 69/2020 for the amendment and update of Law no. 227/2015 regarding the Tax Code, and for providing certain tax measures, while in the Official Gazette no. 396 from May 15, 2020, was published Law 54/2020 for approving GEO 33/2020.
We further present the main provisions of these pieces of legislation, which establish various facilities, possible reductions in taxes and extensions of deadlines.
For all outstanding principal tax obligations due on March 31st, 2020, belonging to individuals or legal entities, interest, penalties and all related accessories shall be cancelled if these principal obligations are paid in full by the date the cancellation request is submitted, but not later than December 15, 2020.
For a better processing of the cancellation of accessories in the tax authorities records and in order to clarify possible discrepancies beforehand, the taxpayers may notify the tax authorities regarding their intention to request the cancellation of the interest and penalties.
In order to benefit from this cancellation, the following cumulative conditions should be met:
Interest and penalties resulting from tax inspections which are in progress on May 14, 2020 may be cancelled if two conditions are met together:
The cancellation of the interest and penalties may be applied under the same conditions to the taxes due on March 31st, 2020 to the local budgets (i.e local taxes), but only if this is decided by the local council of the respective city or town.
GEO 69/2020 offers the possibility to the local councils of each city/town to adopt by August 14, 2020 decisions through which the annual tax for non-residential buildings may be reduced by up to 50%, if the owners or users had to completely cease their activity as per the law, or if they have an emergency situation certificate for partially ceasing their activity.
In order to benefit from this reduction (if regulated by local authorities), building owners must submit a request to this effect by September 15, 2020, as well as an affidavit.
Those who use the buildings for their own activities should declare, depending on each case, that they have totally or partially interrupted the activity (in the latter case enclosing a copy of the emergency certificate).
Those who rent the buildings to others must give an affidavit that they have waived at least 50% of the right to collect the rent during the state of emergency and at the same time, at least 50% of the total space owned have not been used because the tenants had to interrupt totally or partially their activity. Landlords in this situation, in addition to the affidavit, should also attach to the application the affidavits of the tenants who have completely interrupted the activity or the emergency situation certificates of those who have partially interrupted it.
Payment incentives for legal entities
Corporate income taxpayers, regardless of their submission and payment system, as well as microenterprise taxpayers, who pay the tax due for the second and third quarter of 2020, until the standard deadlines of July 25th, 2020 and October 25th 2020 respectively, will benefit from a tax bonus of 10% of the tax due. The bonus applies only for the actual payment of the tax, and not for the cases in which the tax will be offset with other receivables.
Extension of deadlines and payment incentives for individuals
The deadline of May 25th, 2020 (initially extended from March 15, 2020 by GO 6/2020), for the submission of the sole tax return by individuals, the submission of the 230 statement and for the payment of income tax and social security contributions for 2019, is postponed until June 30, 2020.
Also, if the income tax and social security contributions for 2019 are paid in full by this deadline of June 30, 2020, a bonus of 5% is granted on all amounts due. If, in addition to the payment on time, taxpayers submit the sole tax return electronically by June 30, 2020, an additional bonus of 5% may be offered.
The bonuses are determined directly by the taxpayer, through the sole tax return, and will be subject to subsequent verification.
Tax relief for certain incentives
For the amounts granted by the employers during the state of emergency to employees as a result of carrying out activities that involve direct contact with other individuals and risking coronavirus infection, no social contributions are due.
The beneficiaries of the incentives are established by the employer's decision (which also acts as a supporting document). For applying the relief, the incentives must be paid by June 30, 2020 at the latest.
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