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November

Main legislative changes for November 2022

12/12/2022
November

1. The definition of social housing for which the reduced VAT rate may be applied

In the Official Gazette no. 1107 of 17 November 2022, was published the Law no. 301 of 2022 which aimed at the definition of "social housing" in the context of the application of the 5% VAT rate.

The law defines the term “inhabited as such” and presents the elements that a dwelling must fulfill in order to apply the VAT rate of 5%.

The VAT rate of 5% will apply if the dwelling meets the following cumulative conditions:

✓ The owners have free access to the living space without disturbing other persons;
✓ The house has access to electricity and drinking water;
✓ There is a sewage and domestic waste disposal system;
✓ There is at least one sleeping space;
✓ There is at least one food preparation area and one sanitary facility regardless of the level of finishing at the time of delivery



2. Registry for acquisitions of houses under the 5% reduced VAT rate


In the Official Gazette no. 1114 of 28 November 2022, was published the Order no. 2053/2022 for the approval of the Procedure for the organization of the register of housing purchases with a reduced VAT rate of 5%, with effect from 1 January 2023.

Public notaries and the Tax Authorities will have acces and will be required to report these transactions in the Registry for acquisitions of houses under the 5% reduced VAT rate for individuals. Also, the value of the house and land should not exceed the threshold of 600.000 RON.



3. Tax risk sub-criteria of companies and Freelancers


In the Official Gazette no. 1112 of 17 November 2022, was published the NAFA Order no. 2017/2022.

According to this order the development of the risk sub-criteria is carried out by reference to the risks of non-compliance in terms of the taxpayer’s fulfilment of the obligations provided for by the tax legislation, associated with the four general criteria.

According to Article 7 paragraph (7) of the Tax Procedure Code, the general criteria according to which the tax risk class/subclass is established are the following:


a) criteria relating to tax registration:

✓ the sub-criterion concerning non-registration for VAT purposes;
✓ the sub-criterion relating to non-registration as a payer of corporation tax;
✓ the sub-criterion concerning non-registration as a payer of specific tax;
✓ the sub-criterion concerning non-registration as a payer of income tax on microenterprises;
✓ the sub-criterion relating to non-registration as a payer of excise duties;
✓ the sub-criterion relating to non-registration as a payer of income tax and social security contributions;
✓ the sub-criterion concerning the non-registration for tax purposes in the case of carryingout activities, obtaining income and other situations provided for by law for which there is an obligation to register for tax purposes;
✓ the sub-criterion concerning the risks associated with shareholders/associates/directors/other persons from the perspective of tax registration;


b) criteria relating to the submission of tax returns:

✓ sub-criterion on late submission of tax returns;
✓ the subcriterion on non-submission of tax returns;
✓ the subcriterion on erroneous submission of tax returns;
✓ the sub-criterion on the risks associated with shareholders/partners/directors/other persons in relation to the filing of tax returns;


c) criteria with regard to the level of declaration:

✓ the sub-criterion concerning the inconsistency of the data in the tax returns with the data in other forms provided by law, submitted by the taxpayer;
✓ the sub-criterion concerning the inconsistency of the data in the tax returns and in other forms required by law submitted by the taxpayer compared to the data and information submitted by third parties;
✓ the sub-criterion concerning the incorrect declaration of the rate and amount of taxes, duties and contributions by the taxpayer;
✓ the sub-criterion of reduced profitability;
✓ the sub-criterion on the risks associated with shareholders/partners/directors/other persons, in terms of the level of reporting;


d) criteria relating to the fulfilment of payment obligations to the general consolidated budget and other creditors:

✓ the sub-criterion on late payment of tax liabilities;
✓ the sub-criterion on non-payment of tax liabilities;
✓ the sub-criterion on insolvency;
✓ the sub-criterion on the risks associated with shareholders/partners/directors/other persons in relation to the realisation of payment obligations.



4. Changes regarding the taxation of private pensions


In the Official Gazette no. 1109 of 17 November 2022, was published the Law no. 309/2022 for the amendment of Law no. 227/ 2015 regarding the Fiscal Code. The provisions of Law no. 309/ 2022 are to enter into force on 1 January 2024.

The following have been established:

✓ the rights received in accordance with the provisions of Law no. 1/2020 regarding occupational pension funds, represents income from pensions;
✓ the determination of monthly taxable income from each pension fund.

In addition to the existing pension income (income from state pensions and income from voluntary private pensions), a new category for occupational pension is introduced.

The determination of monthly taxable income from each pension fund:


Single payment


The taxable income related to the amounts received as a single payment by participants to facultative pension funds, shall be calculated by deducting from the pension income the non-taxable amount of 2.000 RON once if the amount is fully withdrawn.


Payments in installments


The taxable income related to the amounts received as payments in installments by participants to facultative pension funds shall be calculated by deducting from the pension income the non-taxable amount of RON 2,000 applies for each monthly installment.

 

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 more information on the topics covered please contact us. No liability is accepted for decisions or omissions following the use of the contents of this newsletter. All Crowe newsletters are available at the address www.crowe.ro.

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