Romania will abolish its split payment scheme with effect from 1 February 2020. As a result, the split payment scheme in Romania is to remain in place on a voluntary basis. However it will no longer be mandatory for businesses. Split Payment Mechanism Previously under the split payment mechanism (which [...]
On 23 December 2019, the Ministry of Finance approved a draft bill to implement the EU’s ‘Quick Fixes’ into VAT law in Romania. As a result, the draft bill is in effect from 1 January 2020. The draft bill relates to the implementation of the EU temporary cross-border transaction simplifications; [...]
Romania proceeds with plans for a pilot of Standard Audit File for Tax (SAF-T) for large taxpayers in January 2020. The Romanian tax authorities often look to their Polish counterparts for guidance on introducing new tax legislation and reporting guidelines. Therefore, it’s no surprise to see them follow suit in [...]
Romania has recently enacted legislation providing that as of 1st June 2019, the VAT rate applicable to certain supplies of food will be lowered to the reduced 5% VAT rate. The 5% rate of VAT will apply to food supplies certified by the government as alpine products, organic products or [...]
Romania permits bad debt relief which provides that subject to certain conditions, businesses that do not receive payment of Romanian VAT due on supplies of goods and services they make are permitted to claim relief. This means they can recover the VAT previously declared and paid to the tax authority. [...]
Under changes to Romanian VAT law, as of 13th January 2019 tourist transportation services are subject to the reduced 5% rate of VAT. Recently published legislation provides that the scope of the 5% reduced rate has been extended to cover the following passenger transport services used for tourism or leisure [...]
The European Commission has initiated infringement proceedings against Romania, sending it a letter of formal notice, in relation to its VAT split payment mechanism. This is because the system has been found to be in breach of EU VAT law and the principle of freedom to provide services. Under the [...]
Following our recent story outlining the expected VAT rate changes on certain tourism services by the end of this year, the Romanian government has adopted an emergency ordinance under which the reduced 5% rate of VAT will apply as of 1st November 2018 to: Hotel accommodation and similar services; Renting [...]
The Romanian Ministry of Tourism has confirmed that certain tourism services will be subject to VAT at the reduced 5% rate by the end of 2018. This change will be made under a package of measures aiming to revitalise the tourism sector. The 5% rate of VAT is expected to [...]
As of 1st April 2018, the Romanian VAT registration threshold for resident businesses is increased to LEI 300,000 (EUR 88,500) from LEI 220,000 (EUR 65,000). Taxable persons in Romania whose annual turnover falls below the registration threshold are exempt from registration for VAT purposes, which means that they may neither [...]
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