Fiscal Code Norms

Profits tax
 
Fiscal depreciation:
 For assets lying idle for more than 1 month, fiscal depreciation will be recomputed from the month following the recommissioning of the asset;
 Accounting revaluations carried out after 1 January 2004 seem to be recognised for fiscal purposes also.
 
 Deductibility of certain expenses:
 For certain services rendered on an occasional basis (e.g. maintenance and repair, mail services, transport and parking) the deductibility of the related expenses is no longer conditioned on written contracts;
 Expenses on stocks and depreciable fixed assets destroyed in natural disasters shall be treated as deductible for profits tax purposes if these assets are located in areas under the official state of emergency.
 
 Dividends from another Member State:
 The benefits of the Parent - Subsidiary Directive may be applied also for revenues received before the qualifying conditions are met, on the fulfillment of such conditions.
 
 Permanent establishment:
 Clarifying provisions have been introduced on the definition/criteria of assessing a permanent establishment, in line with OECD Guidelines.
 Micro enterprises
 
 If a micro enterprise derives more than 50 percent of its income from management and consultancy services, it becomes liable to pay profits tax from the beginning of the year.
 
 Withholding tax
 
 The Norms provide the template of the declaration to be submitted by the income payers required to withhold tax for income received by non-residents;
 The benefits of the Parent – Subsidiary Directive may be applied for revenues paid before the qualifying conditions are met. A tax refund may be obtained as soon as the conditions are fulfilled.
 
 VAT
 
 The Norms provide clarifications and methodologies on the application of VAT. The main changes refer to intra-Community transactions. (Details will be provided in a separate tax alert.)
 
 Excise duty
 
 Certain transitory provisions have been introduced in the
 Norms including inter alia:
 Excise duty exemption authorisations issued in 2006 will be valid until 1 March 2007 in certain conditions;
 The accompanying administrative documents in stock may be used also after 1 January 2007, but only for the movement of excisable goods under suspensive regime inside Romania;
 For transactions in excisable goods with Member States that began before 1 January 2007 and conclude at a later date, the regulations in force when the transaction began will be applicable;
 The norms also provide the templates of certain documents and special forms related to excise duty and the fiscal warehouse regime.
 
 (Government Decision 1861/2006 published in the
 Official Gazette 1044/2006)