White Mountain Property

February 2010
Procedure for processing applications for VAT refunds (Order no. 263/2010, Official Gazette no. 131/26.02.2010)

This order introduces changes to the procedure for processing VAT refund applications, in particular the criteria used to define a taxpayer as being of low fiscal risk. Taxpayers submitting VAT returns containing negative amounts equal to or less than RON 10,000 are now considered to be of low risk and as a result VAT will be reimbursed without the need for a tax inspection (n.b. a tax audit will be performed at a later stage after the VAT refund).

All taxpayers performing intra-community supplies of goods are eligible under certain circumstances to obtain VAT refunds without a prior tax audit by the tax authorities. However, this does not apply to high risk taxpayers (as determined through a specific evaluation performed by the tax authorities).

March 2010
Reference interest rate (Circular no. 8/2010, Official Gazette no. 131/01.03.2010)
The National Bank of Romania has amended the reference interest rate. Up to March 2010, the rate is set at 7.25% per annum.

Postponement of advance payment of profit tax (Emergency Ordinance no. 22/2010, Official Gazette no. 201/30.03.2010)
This amendment to the Romanian Fiscal Code postpones implementation of the advance profit tax payment system from 2010 to 2012. Until then, taxpayers (with the exception of financial institutions) will have to pay quarterly profit tax as per their current realised tax profit.

April 2010
Financial year clarification (Order no. 864/2010, Official Gazette no. 229/12.04.2010)
This order provides clarification for taxpayers whose financial year differs from the calendar year in respect of the preparation of annual financial statements.

Tax deductibility threshold for interest on foreign currency loans (Decision no. 296/2010, Official Gazette no. 239/15.04.2010)
As of January 2010, the tax deductibility threshold for interest on foreign currency loans from non-financial institutions has been reduced from 8% to 6%.
Amendments to the Fiscal Procedure Code (Emergency Ordinance no. 39, Official Gazette no. 278/28.04.2010)
New late payment penalties/interest on state budget liabilities
As of 1st July 2010, the level of interest on late payments will be reduced from 0.1% to 0.05% per each day of delay.
A new kind of liability has been introduced called the "late payment penalty" with a value of 5% on payments made 30 to 90 days late and 15% for payments more than 90 days late. This provision is also applicable from 1st July 2010.
The level of late payment penalties for local taxes will be of 2% of the fiscal liabilities unpaid in due time, calculated for each month or part of month. Similarly, this provision is also applicable from 1st July 2010.

Reassessment of taxable base
In the event a taxpayer's fiscal or accounting records or statements are incorrect, incomplete, false, or do not exist or are not made available to the fiscal investigation bodies, the tax inspectors may use indirect methods to reconstitute incomes and expenses in order to establish the taxpayer's fiscal obligations. These amendments will come into force on 21st April 2010.
Competent authority for resolving contestations
The National Fiscal Administration Agency is responsible for resolving contestations in which the level of contested fiscal receivables exceeds RON 3 million. Contestations for values below this threshold are to be resolved by the local tax authorities.