From 2016, a new Fiscal code: at what should you pay attention! Pluses and minuses
VAT of 20%, tax on dividends of 5%, social contribution for all the revenues from independent activities, a new system of local taxes are the measures with high impact from the new Fiscal code.
There are, however, many other very important new provisions of which you should be aware in 2016, and Contexpert continue to report them to you. Some will have positive effects, some not:
The profit tax:
- Will be considered Romanian contributors also the foreign companies with the headquarter in Romania (place of effective management)
- Will be considered deductible expenses those made in the scope of the economic activity (not only those made in the scope of obtaining taxable revenues)
- The limit for the sponsorship expenses will increase at 5‰ applied to the turnover, from 3 ‰
- The limit for the deductible social expenses will increase at 5%, from 2%
- For the provisions booked for the outstanding receivables, the condition that the revenues from receivables to be taxable revenues of the taxpayer, will be eliminated.
- The losses registered at the write off of the receivables will be deductible, including for the case when there are insurance contracts signed for them
- The adjustments for the depreciation of the fixed assets will be deductible in certain conditions, not being in full non-deductible, as until now
- There will be introduced new criteria related to the stock expenses or fixed assets for the situations when there missing or degraded items, in order to be recorded as fiscally deductible
- Regarding the research expenses, the deductions are not recalculated if the project is not reliable;
- Will be introduced a new category of assets for the exemption applied to the reinvested profit
The income tax of the microenterprises
- The income tax rate will differ according to the number of employees (3% if there are no employees, 2% if there is an employee and 1% if there are 2 or more employees) and for the new companies, the tax rate will be 1%, in certain conditions;
- The income ceiling up to which the entities will be considered microenterprises will increase from 65.000 euro to 100.000 euro
The income tax
- Will increase the personal deductions for the calculation of the salary tax and the deduction will be given to both parents who have dependent children
- The rate for the deductible expenses used to calculate the net revenues from the intellectual property rights and from the rent of the goods, including the lease, will increase at 40%
- The voluntary health insurance paid by the employees will be deductible at the salary tax calculation and those paid by employers for their employees are not taxable in the limit of 400 euro/annum/person
- To determine the earning or the loss from the transfer of the securities, the fiscal value will be taken into consideration
- The annual net gain or the annual net loss from the transfer of the securities will be determined by the taxpayer based on the statement for the realized income.
- The income from dividends are taxed with 5%
Social contributions
- Starting with January 1st, 2016, persons who obtain incomes from independent activities owe social insurance contribution (pension contribution) even if they obtain other salary incomes
- The social insurance contribution will be calculated, in case of these persons, at the actually realized net income, but not less than 35% of the average gross wage and no more than the equivalent of five times this gain
VAT
- The standard VAT rate will be reduced from 24% to 20%
- The reverse charge will be extended for the delivery of buildings, parts of building and lands of any kind, as well as for mobile phones, PC tablets, laptops, game consoles and integrated circuit devices;
- The reduced VAT rate of 5% will apply for the deliveries of school manuals, books, newspapers and some magazines, and also for the services consisting in granting the access to castles, museums etc.
- The limit for applying the rate of 5% for social housing will increase to 450,000 lei from 380,000 lei lei
- The self invoicing will be mandatory for the adjustment of the input VAT in case of the reductions, price differences, returns, the total or partial cancellation of a transaction, if the supplier does not issue the adjustment invoice at the date of the event that generates the adjustment of the VAT.
Excise
- The excise level changes for the majority of the excise products
- Will be eliminated the excise for coffee, yachts, gold and/or platinum jewelries, confections of natural furs, motor vehicles with more than 3.000 cmc, arms and ammunition.
Local taxes
- The tax system will change based on the destination of the building (residential/non-residential), not being based on the owner (individuals/companies). For residential, the rates will be between 0.08% and 0.2%, and for the non-residential between 0.2% and 1.3%, based on the decisions of the local councils
- It is eliminated the higher taxation for owning more than one building
- The local authorities will have the possibility to increase the local taxes up to 50%
- For the farmlands that have not been used for 2 consecutive years and for the abandoned buildings, the tax can increase up to 500%
- In the case of changing the owner during the year, the new owner will pay the tax starting with the next year of the acquisition
Tax on constructions
- The tax for the special constructions will apply also in 2016, the agricultural buildings being eliminated from the tax base
