Companies that request the first register for VAT purposes may be rejected by ANAF, without further checks, according to the Order 1964/2015, which changed the Order 17/2015. The new regulations came into force on July 29, 2015 and changed the registration procedure for VAT applicable from 1st of February 2015.
What changes?
According the new order 1964/2015, in the case when the legal representative of the taxpayer does not provide correct and complete data and information as required and the taxpayer doesn’t clarify the intention and ability to carry out economic activities involving operations within the scope of VAT, the department with responsibilities in assessing intention and capacity to undertake economic activities will:
The previous provisions, valid for the situation in which the legal representative of the taxpayer does not provide correct and complete data and information and doesn’t clarify the intention and ability to conduct economic activities, according to the Order 17/2015, provided that in the case when the specialized department which was receiving the application concludes that the company doesn’t qualify, it could not be decided to reject it immediately, the case had to be sent for analysis with all the documentation to the Regional Directorate Against Tax Fraud.
The Declaration/ Statement 088 was also changed
The second important change of the procedure for VAT registration purposes came into force on August 3 through the Order 1966/2015, which contains the declaration 088, for the assessment of the intention and capacity to carry on economic activities, which involves operations within the scope of VAT.
Compared with the previous version, the new form introduces two questions. The first one refers to amounts that shareholders and administrators of the company which is applying for registration for VAT purposes, credited other companies, where they have acted as shareholders / administrators. The second question verifies if the company had submitted the statement 088 in the past.
You should consider that:
From February 1, 2015, the registration for VAT purposes has produced bottlenecks in business, especially for newly established firms. Form 088 that assesses the intention and ability of companies to register for VAT has created and continues to create problems because it no longer provides a clear and transparent score or a detailed calculation methodology attached. Therefore the applicants are not enabled to anticipate whether they are meeting the registration criteria of the NAFA or not.
Contexpert recommendation is that the registration request to be carefully and thoroughly prepared to avoid an unpleasant surprise from the NAFA that would obstruct, at least temporarily, the activity.
What does the declaration 088 mean?
Through the questions included in the declaration 088 NAFA checks that:
Other questions concern: the number of individual labor contracts concluded for the object of activity, the education / professions of the administrators during the last 12 months, the number of companies in which they had the statute of shareholders/administrators in the last three years.
Along with submitting the form 088, the companies must submit also the supporting documents, such as: diploma of studies of the administrators, documents which attest the nature and the amount of the gross income of the administrators or shareholders in the past year, copies of employment contracts concluded by the company, copies of the account statements and other banking documents etc.
Important!
The declaration 088 should be submitted again if the company changes its registered office and / or shareholders / administrators. Practically, that means that NAFA is conducting a recheck of the criteria to be fulfilled for the registration for VAT purposes, which can lead to the VAT code cancellation.
NAFA identifies monthly in the database the taxpayers who have mentions at the Trade Register, regarding the change of the registered office or shareholders and / or administrators and they are notified to submit the Declaration 088.
Who must follow the registration procedure?
There are four situations when the firms could require registration for VAT purposes. For each of them the documentation is different:
1. upon request, in the same day with the registration request at The Trade Register, according to art. 153, (1) a) Fiscal Code.
2. mandatory due to exceeding the VAT ceiling, according to art. 153, (1) b) Fiscal Code.
3. upon request during the activity, according to art. 153, (1) c) Fiscal Code.
4. following the cancellation of the registration code, according to art. 153, (91) Fiscal Code.
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