Worldwide VAT, GST and Sales Tax Guide
Recovery of VAT by non-established businesses Yes, subject to certain conditions
B. Scope of the tax
VAT applies to the following transactions:
• Supplies of goods or services made in Romania by a taxable person
• The intra-Community acquisitions of goods from another European Union (EU) Member State by a taxable person (see the EU chapter)
• Acquisition of general business-to-business (B2B) services taxable in Romania, from EU and non-EU suppliers
• The importation of goods into Romania
Quick Fixes. Pending introduction of a “definitive” system for the VAT treatment of intra-Community supplies of goods to taxable persons, the EU has adopted Quick Fixes for intra-Community trade in goods. For an overview of Quick Fixes rules, see the EU chapter. For documentary requirements, see Section H. Invoicing, subsection Proof of exports and intra-Community supplies.
The Quick Fixes have been implemented in Romanian VAT law, through Ordinance no. 6/2020. The Quick Fixes introduced provisions regarding call-off stocks and the conditions for applying this regime, chain supplies and changes regarding the intra-Community supplies of goods and the conditions for applying the related VAT exemption.
Effective use and enjoyment. To avoid instances of non-taxation or double taxation, EU Member States can apply use and enjoyment rules that allow a service that is “used and enjoyed” in the EU to be taxed or prevent a service that is “used and enjoyed” outside the EU from being taxed. If a service is taxed in the EU under the use and enjoyment provisions, a non-EU supplier of the service may be required to register for VAT in every Member State where it has customers that are not taxable persons. For information regarding the rules relating to VAT registration, see the chapters on the respective EU countries.
In Romania, the following services are subject to the “use and enjoyment” provisions:
• Ancillary transport activities, such as loading, unloading, handling and similar services
• Works on tangible movable property and valuations of tangible movable property
• Transport of goods performed in Romania
Transfer of a going concern. Romania has implemented in its legislation the concept of transfer of going concern (TOGC). As per the Romanian VAT legislation, the transfer of all the assets or of a part thereof, performed upon the transfer of assets (and liabilities, as the case may be), as a result of transactions such as in-kind contribution or asset deal (excluding spin-offs or mergers), would not be considered as a supply of goods, but as a transaction outside the scope of VAT (the “no-supply rule”), provided that the recipient of the respective transfer is a taxable person established in Romania.
Transactions between related parties. For supplies of goods and services for which the beneficiary is an affiliated party related to the supplier, the taxable base is considered to be the market value in the following situations:
• If the compensation is lower than the market value and the beneficiary of the supply does not have a full deduction right.
• If the compensation is lower than the market value and the supplier does not have a full deduction right and the supply is exempt.
• If the compensation is higher than the market value and the supplier does not have a full deduction right.
Market value translates to the total amount that, to obtain the goods or the services at the respective time, a customer, found in the same commercial phase at which the supply of goods or services takes place, should pay under conditions of local competition to an independent supplier in the Member State in which the supply falls within the VAT sphere. If a comparable supply of goods or services cannot be established, market value translates to:
• For goods: the amount that is not lower than the purchasing price of the goods or of some similar goods or, in the absence of a purchasing price, the cost price, established at the time of the supply.
• For services: the amount that is not lower than the complete costs incurred by the taxable person for the supply of the service.
C. Who is liable
A “taxable person” is any person who independently makes taxable supplies of goods or services in the course of a business, regardless of the purpose or results of that activity. The VAT registration threshold is a turnover of RON300,000 (EUR88,500) a year (this threshold applies only to taxable persons established in Romania). Established taxable persons who estimate or record a turnover of more than the Romanian currency equivalent of EUR88,500 must request the VAT registration within 10 days of the moment the threshold is exceeded or achieved. The date when the threshold was achieved or exceeded is deemed to be the first day of the month following the one in which the threshold was achieved or exceeded. The VAT registration becomes valid starting the first day of the month following the month of the request.
Exemption from registration. Taxable persons having the seat of their economic activity in Romania are not required to register for VAT purposes in Romania if their annual turnover does not exceed RON300,000 (EUR88,500). However, they may opt to register for VAT purposes.
A taxable person not established in Romania who is liable to pay VAT in Romania, may be exempt from the VAT registration under the following specific situations:
• When performing occasional services in Romania, if these operations do not follow an intraCommunity acquisition of goods performed in Romania
• When performing occasional supplies of goods in Romania, except: – Distance sales
– Supplies of goods following intra-Community acquisitions of goods in Romania
The abovementioned supplies of goods and services are considered occasional if they are performed once a year.
Voluntary registration and small businesses. Taxable persons that have a business establishment in Romania and who do not exceed the VAT registration threshold may opt to register for VAT purposes in Romania. Taxable persons not established in Romania may opt to register for VAT purposes in the case of:
• Imports of goods
• Sale/rental of real estate subject to VAT
Group registration. VAT grouping is allowed under Romanian VAT law. Under the rules currently in effect, a minimum of two taxable persons may form a fiscal group if all the members meet the following conditions:
• They are established in Romania
• They do not belong to another fiscal group
• They use the same tax period
• Their capital is held directly or indirectly in a proportion of more than 50% by the same shareholders
• Taxable supplies of immovable property in Romania by a taxable person registered for VAT in Romania to a Romanian VAT-registered taxable person
• Taxable supplies of investment gold and taxable supplies of raw materials and semifinished gold having a title higher or equal with 325 to a thousand (the proportion of fine precious metal contained) to a Romanian VAT-registered taxable person
• Supply of mobile phones, laptops, tablets, game consoles or other devices with integrated circuits by a taxable person registered for VAT in Romania to a Romanian VAT-registered taxable person (provided that the value of the goods supplied mentioned on an invoice is higher than RON22,500 approx. EUR4,500)
Digital economy. Specific VAT rules apply to cross-border supplies of goods and services sold via the internet (e-commerce) in all EU Member States with effect from 1 July 2021. These new rules apply to all direct sales to nontaxable persons (in practice, these are mostly private individuals), but we refer to these rules as e-commerce VAT rules because most of these transactions are conducted via the internet. In general, the place of supply is in the country of consumption, i.e., where the goods are shipped to or where the buyer of the goods or services resides, subject to any “use and enjoyment” provisions that may override this rule (see the Section B. Effective use and enjoyment subsection above). Therefore:
• For supplies of services made by a nonresident supplier to a business customer (B2B), the business customer is responsible for accounting for the VAT due, using the reverse charge.
• For supplies of goods made by a nonresident supplier to a business customer (B2B), where the goods are transported from another EU Member State, the business purchasing the goods is responsible for accounting for the VAT due, as an intra-Community acquisition. If the goods come from outside the EU, the purchaser may have to report an importation of goods.
• For supplies of goods or services made by a nonresident supplier to a final consumer (B2C), the supplier is generally responsible for charging and accounting for the VAT due at the rate applicable in the customer’s country (unless the supplier’s sales fall beneath the distance selling threshold of EUR10,000 with effect from 1 July 2021). This VAT can be reported using a single VAT registration, using a “One-Stop-Shop” mechanism.
For more details about intra-EU distance sales, see the EU chapter.
Effective 1 July 2021, an e-commerce supplier may have a choice of how to account for VAT on its B2C supplies.
Local VAT registration. A nonresident supplier may choose to register for VAT in each Member State and account for VAT on all supplies made and recover input tax in accordance with local rules (see the Non-established businesses subsection above). Non-EU businesses may be required to appoint a fiscal representative for accounting for the VAT due on these transactions.
In Romania, non-EU businesses are required to appoint a fiscal representative for accounting for the Romanian VAT due on these transactions having the place of supply in Romania. EU businesses, on the other hand, can obtain a direct VAT registration in Romania or may opt to appoint a fiscal representative.
One-Stop Shop. Effective 1 July 2021, a supplier can choose to account for the VAT due under the EU One-Stop Shop (OSS), which can be used for intra-EU cross-border supplies of goods and all cross-border supplies of services made to final consumers in the EU. Unlike the previous Mini One-Stop-Shop (MOSS) scheme that applied until 30 June 2021, the OSS is not limited to cross-border supplies of electronic services, telecommunication services and broadcasting services.
The OSS is an electronic portal that allows businesses to:
• Register for VAT electronically in a single Member State for all intra-EU distance sales of goods and for B2C supplies of services
• Declare and pay VAT due on all supplies of goods and services in a single electronic quarterly return
The OSS can be used by businesses established in the EU and outside the EU. If a supplier or a deemed supplier decides to register for the OSS, it must declare and pay VAT for all supplies (goods as well as services) that fall under the OSS.
As per the Romanian VAT rules, persons that carry on activities falling under the EU OSS regime may opt to apply this regime and will request the special registration in Romania if they fall in the following categories:
• Taxable persons (including electronic interfaces that facilitate B2C supplies of goods made locally in Romania by non-EU taxable persons) who have their registered office in Romania or, if they are not established in the EU, have a fixed establishment in Romania
• Taxable persons who do not have their registered office in the EU but have more than one fixed establishment in the EU, including in Romania, and choose Romania as the Member State of registration
In addition, in the case of distance sales of goods, the EU OSS regime (and special registration in Romania) may also be used by taxable persons who are not established in the EU and do not have a fixed establishment in Romania:
• If goods subject to distance sales are dispatched/transported from Romania
• If distance sales refer to goods dispatched/transported from different Member States, including Romania, and the taxable person chooses Romania as the state of registration
For more details about the operation of the OSS, see the EU chapter.
Import One-Stop Shop. Effective 1 July 2021, the Import One-Stop-Shop (IOSS) scheme applies for B2C distance ales of goods from outside the EU.
Effective 1 July 2021, VAT is due on all commercial goods imported into the EU regardless of their value. The actual supply is subject to VAT in the country where the goods are imported (the country of destination). The IOSS facilitates the declaration and payment of VAT due on the sale of low-value goods (i.e., consignments valued at less than EUR150 per consignment). It allows suppliers selling low-value goods dispatched or transported from a non-EU country to customers in the EU to collect, declare and pay the VAT due. If the IOSS is used, the importation into the EU is exempt from VAT.
As per the Romanian VAT rules, IOSS may be used, directly or through an intermediary, by taxable persons having their registered office in Romania or, if they are not established in the EU, having a fixed establishment in Romania.
Persons not established in the EU may use the IOSS in Romania by appointing an intermediary. Alternatively, IOSS may be used directly, if the non-EU person is established in a third country with which the EU has concluded a mutual assistance agreement and that persons performs distance sales of goods imported only from the respective third country.
IOSS may also be used by taxable persons who do not have their registered office in the EU, but who have more than one fixed establishment in the EU, including in Romania, and choose Romania as the Member State of registration.
For more details about the IOSS, see the EU chapter.
The use of the IOSS special scheme is not mandatory. If VAT is not collected via the IOSS scheme, the importation of goods into the EU is subject to import VAT in the country of final destination, and the Member State can decide freely who is liable to pay the import VAT, which could be the customer or the seller (or an electronic interface).
Postal services and couriers scheme. If the IOSS is not used and the customer is liable for import VAT due on the supply (and importation) of consignments with a small intrinsic value (i.e., less than EUR150), VAT can be collected using the special scheme for postal services and couriers.
As per the Romanian VAT rules, when Romania is the country of importation, the person presenting goods in customs must submit to the competent customs authority, in electronic format, a special monthly VAT return containing information on the total amount of VAT collected in the respective calendar month. If this special scheme is applied, the imports are subject to the standard 19% VAT rate (even if under normal circumstances the goods are subject to a reduced VAT rate).
Moreover, the person presenting the goods to customs must submit the special VAT return and pay the VAT collected in the respective month, by the 16th day of the month following the reporting calendar month. Persons using this mechanism should keep special registers containing information that would allow the Romanian fiscal or customs authorities to check the correctness of the VAT return. These records must be made available, on request, electronically and kept for a period of 10 years from the end of the year in which the operations were carried out.
For more details about the special scheme for postal services and couriers, see the EU chapter.
Online marketplaces and platforms. Under the new EU VAT e-commerce rules, effective 1 July 2021, taxable persons that “facilitate” certain B2C sales of goods are deemed to have purchased and then supplied those goods themselves. This means that the single supply from the “underlying” supplier to the final consumer is split into two deemed supplies:
• A supply from the supplier to the facilitator (deemed B2B supply)
• A supply from the facilitator to the final customer (deemed B2C supply). Any intermediation service provided by the facilitator is disregarded for VAT purposes
This provision does not cover all sales facilitated via the facilitator. It only covers distance sales of goods imported from non-EU jurisdictions in consignments with an intrinsic value not exceeding EUR150. The jurisdiction of residence of the supplier using the facilitator is irrelevant. The supply to the facilitating platform is VAT exempt and the supplies made by that platform follow the e-commerce VAT rules as described above. In addition, the provision also covers sales within the EU, if the supplier is not established within the EU. This applies to both local shipments within one Member State as well as intra-Community shipments. In both cases, the final customer must be a nontaxable person.
As per the Romanian VAT legislation, where a taxable person, using an electronic interface such as an online marketplace, a platform, a portal or other similar means, facilitates the supply of goods or services to a nontaxable person in the EU, the taxable person who facilitates the supply of goods or service is obliged to keep records in this respect. The respective registers must contain information that would allow the fiscal authorities to verify if the VAT has been highlighted correctly, in the situation where the respective supplies of goods or services are taxable in Romania. The registers must be made available to the competent tax authorities, upon request, electronically, and must be kept for a period of 10 years from the end of the year in which the operation was carried out.
For more details about the rules for online marketplaces, see the EU chapter.
Vouchers. Vouchers can be single-purpose (SPVs) or multipurpose (MPVs). A voucher is defined as an instrument by which a supplier is obliged to accept it as partial or total payment for a supply of goods or services. The payments received for the sale of an SPV are deemed as advance payments for which VAT is due. An SPV is a voucher for which the place of supply and the VAT liability of the goods/services for which the voucher may be redeemed are known at the time the voucher is issued. An MPV is a voucher other than the SPV. The sale of an MPV does not trigger a VAT liability.
Registration procedures. Established or non-established taxable persons applying (as a requirement or by option) for a VAT registration in Romania must file specific forms depending on the
submit a declaration on own responsibility, according to the model from Annex to the Romanian Fiscal Code)
• Access to amusement and recreational parks and sporting events
• Supply of social housing (including related land); for this purpose, social housing includes, but is not limited to, houses that are a maximum of 120 square meters and that do not exceed RON600,000 in value (net of VAT) (approx. EUR120,000 from 1 January 2023); the reduced 9% VAT rate applies for the supplies performed toward individuals and only if the house can be used as such after the sale; any natural person can purchase, starting from 1 January 2024, individually or jointly with another natural person/other natural persons, a single house whose value does not exceed the amount of RON600,000 (approx. EUR120,000), exclusive of VAT, with a reduced rate of 9%.
By exception to the above provisions, the reduced 5% VAT rate is maintained between 1 January and 31 December 2024, for legal acts concluded between 1 January and 31 December 2023, that have as their object the advance payment for the purchase of such houses. Any acquisitions with respect to the reduced VAT rate should be included in the specific “Register of housing acquisitions with reduced VAT rate”; the delivery of buildings, including the land on which they are constructed, to municipalities for the purpose of assigning them with subsidized rent to individuals or families whose economic situation does not allow them access to home ownership or the rental of a dwelling under market conditions. The term “exempt” refers to supplies of goods and services that are not liable to VAT and that do not qualify for input tax deduction.
Examples of exempt supplies of goods and services
• Specific banking and financial operations
• Insurance and reinsurance
• Medical services
• Education
• Specific hiring, concession, leasing or letting of immovable property (unless option to tax is exercised)
• Sale of “old” buildings (unless option to tax is exercised)
• Re-imports of Romanian goods repaired abroad (equivalent to the exported goods)
• Imports of natural gas through specific distribution systems and electricity
• Prostheses of any type and accessories (except dental prostheses)
• Orthopedic products
• Construction, rehabilitation, modernization of hospitality units from the public network
• Delivery of medical equipment, machines, devices, safety equipment, materials, and consumables for sanitary use in the field of health care or for the use of disabled persons, essential goods for compensation and overcoming disabilities, as well as adaptation, repair, rental and leasing of such goods to public hospitality units from the public network or the ones owned and used by nonprofit entity
Option to tax for exempt supplies. Any taxable person may opt to tax the hiring, concession, leasing or letting of immovable property and the sale of “old” buildings by means of a taxation notification submitted to the competent tax authorities.
E. Time of supply
The time when VAT becomes due is called the “chargeability to tax” or “tax point.” The basic time of supply for goods is when the goods are delivered. The basic time of supply for services is when the services are provided. Several exceptions apply to these rules.
For intra-Community acquisitions or exempt intra-Community supplies of goods, the tax point arises on the day when the invoice is issued, the day when a self-invoice is issued or the 15th day of the month following the tax point, whichever is earlier.
deductibility of the input tax on the acquisition of such vehicles – whether by purchase, intraCommunity acquisition, import, rental or leasing – and on service expenses related to those vehicles is limited to 50%, if the vehicle is not used exclusively for business purposes.
However, a 100% deduction is available for vehicles used for certain specifically mentioned activities (for example, when used to render services against consideration, when used as merchandise for commercial purposes or when used by sales and purchase agents) are not subject to such provision. In this context, input tax recovery should be supported by backup documentation and logbooks.
There are limitations of VAT deduction right for real estate. The VAT deduction right will be limited to 50% in the following cases, if they are not used exclusively for business purposes:
• Purchases, rentals or leasing of buildings/living spaces, regardless of their destination, located in residential areas or in blocks of flats
• Expenses related to these buildings/living spaces
The abovementioned provisions will be applicable starting with the first day of the month following the one when Romania will obtain a derogation from the EU Council in this respect.
The deduction of VAT by the taxable person is no longer applicable for transportation or accommodation in hotels or other similar units based on invoices issued in the name of the employees of a taxable person who are traveling on business,.
Partial exemption. Input tax directly related to taxable supplies is fully recoverable, while input tax directly related to exempt supplies is fully non-recoverable. Input tax that is attributable to both taxable and exempt supplies (such as VAT paid on overhead costs) is deductible on a pro rata basis. The pro rata method is generally based on the percentage of income generated by supplies with a right to input tax deduction, divided by total income. The calculation of recoverable VAT is based generally on the pro rata percentage for the preceding year. However, a special pro rata percentage may be used if approved by the tax authorities. Pro rata percentages may also be established for each sector of the taxable person’s activity that has a partial right to claim deductions.
Input tax related to acquisitions of goods or services that may be allocated to operations allowing VAT deduction right or to operations not allowing VAT deduction right is not deducted based on a pro rata (but based on direct allocation).
In the case of acquisitions destined for investments, which will be used both for operations allowing VAT deduction right and for operations not allowing VAT deduction right, the taxable person can deduct the VAT fully during the investment period. This VAT will be adjusted in the first year when supplies will be performed using the good resulting from the investment.
Approval from the tax authorities is not required to use the partial exemption standard method in Romania. Special methods are not allowed in Romania.
Capital goods. Capital goods include any fixed tangible assets subject to depreciation, constructions and land of any kind held for the production or supply of goods or services, for rental or administrative purposes. It also includes the construction, transformation or modernization of immovable goods but excludes repairs or works of maintenance on these assets. Fixed tangible assets that are leased are deemed capital goods of the lessor.
Input tax is deducted in the year in which the goods are acquired. The amount of input tax deducted depends on the destination or use of the good and/or on the partial exemption of the taxable person. However, the amount of input tax deducted must be adjusted over time if the destination or use of the goods changes, the capital goods cease to exist or the taxable person’s partial exemption percentage changes.
• The minimum claim period is three months, while the maximum period is one year.
• The minimum claim for a period of less than a year, but greater than three months, and is the equivalent in RON of EUR400 (approx. RON2,000). For an annual claim or a claim for a period of less than three months, the minimum amount is the equivalent in RON of EUR50 (approx. RON250).
• The deadline for refund claims is 30 September of the year following the calendar year of the reimbursement period.
To benefit from the refund, the taxable person must appoint a tax representative who will carry out the tax registration procedures for non-EU persons; the registration code assigned to the representative will be used only in the VAT refund procedures. After registration, the representative will submit the Reimbursement Application (Form 313), in electronic format, to which they will attach the supporting documents (invoices, import documents, etc.) at the address https:// pfinternet.anaf.ro/ or the online filing service on the e-guvernare.ro portal) or in paper format, at the fiscal body registry or by mail (i.e., a registered letter, with acknowledgment of receipt). The refund application must be submitted to the competent central tax body in charge with administering the fiscal representative of the non-EU person.
Late payment interest. In the case of late VAT refund payments to EU and non-EU businesses, the Romanian tax authorities must pay late payment interest at a rate of 0.02% per day of delay. This starts with the date when the VAT refund application should have been settled and up until the date of effective payment by the Romanian tax authorities. The refund request should be settled by the Romanian tax authorities within 45 days from the date the request has been submitted.
H. Invoicing
VAT invoices. A Romanian taxable person must generally provide a VAT invoice for all taxable supplies made. A VAT invoice is required to support a claim for input tax deduction.
Credit notes. Invoices that contain errors may be canceled and the taxable person may issue a “reversal invoice.” The amount credited must be printed on the reversal invoice and must be preceded by a minus sign. A reversal invoice must contain the same information as a VAT invoice and a cross-reference must be provided.
Electronic invoicing/e-reporting. Electronic invoicing is mandatory in Romania for certain taxable supplies.
Business to government supplies. Electronic invoicing is mandatory for business to government (B2G) supplies, in line with EU Directive 2010/55/EU (see the EU chapter). This is with effect from 1 July 2022.
Business to business (B2B) supplies. For the period 1 January 2024 to 30 June 2024, economic operators established in Romania:
• Continued to issue and transmit invoices (i.e., the traditional invoice) according to general invoicing provisions stipulated in the relevant VAT legislation (i.e., the Romanian Fiscal Code), unless both the issuer/seller and the beneficiary were registered in RO e-Factura system.
• Were required to submit their invoices through the RO e-Factura system for B2B transactions having the place of supply in Romania, within five working days after the invoice was issued, but no later than five working days from the legal deadline to issue the traditional invoice based on the VAT legislation.
Certain transactions are excluded from e-reporting obligations: intra-Community supplies of goods, exports of goods, supplies toward beneficiaries not established and not registered for VAT purposes in Romania, and services for which Romanian invoicing rules do not apply.
For the period starting 1 July 2024, for B2B transactions performed between economic operators established in Romania:
• Only the invoice communicated via RO e-Factura system qualifies as an invoice for VAT purposes.
• The e-invoice is no longer subject to acceptance by the recipient.
• The obligation to communicate the e-invoice via RO e-Factura system occurs within five calendar days from issuance, or within five calendar days from the legal deadline for invoicing, whichever occurs first.
The self-invoices issued for self-supplies of goods or services are invoices issued in a B2B relationship, therefore, it is mandatory to report them via the RO e-Factura system.
Taxable persons established in Romania who issue invoices for operations that are not within the scope of VAT, or for amounts that are not included in the VAT taxable base, for which there is no obligation to issue an invoice according to the relevant VAT legislation, are not required to report them via the national RO e-Factura system.
For the period starting 1 January 2024, economic operators not established but registered for VAT purposes in Romania:
• Continue to issue and transmit invoices (i.e., the traditional invoice) according to general invoicing provisions stipulated in the relevant VAT legislation, unless both the issuer/seller and the beneficiary are registered also in RO e-Factura system
• Are required to submit their invoices through the RO e-Factura system for B2B transactions having the place of supply in Romania within five working days since the invoice was issued, but no later than five working days from the legal deadline to issue the traditional invoice based on the VAT legislation
Certain transactions are excluded from e-reporting requirements: intra-Community supplies of goods, exports of goods, supplies toward beneficiaries not established and not registered for VAT purposes in Romania and services for which Romanian invoicing rules do not apply.
Business to consumer (B2C) supplies. E-reporting of invoices for transactions carried out by taxable persons established in Romania to nontaxable persons (i.e.,) for B2C supplies was optional in Romania during the period 1 July 2024 to 31 December 2024, and is mandatory starting 1 January 2025. E-reporting obligation is mandatory only for B2C transactions that have their place of supply for VAT purposes in Romania. In the case of B2C transactions, economic operators established in Romania must continue to issue and transmit invoices (i.e., the traditional invoice) according to general invoicing provisions stipulated in the relevant VAT legislation.
Only fiscal cash receipts that meet the conditions of a simplified invoice, both in B2B and B2C cases, will be exempt from the obligation to be transmitted in the national RO e-Factura system.
Optional use of the RO e-Factura system. The use of the national RO e-Factura system is not mandatory for the supplies of goods or services performed by:
• Taxable persons referred to in Art. 294 para. (1) letters j) - n) of Fiscal Code, which regulates certain specific VAT exemptions with deduction right (for example: in favor of diplomatic missions, to the European Community, ECB, EIB, European Commission, NATO)
• Until 1 July 2025, institutes and cultural centres of other states operating in Romania based on intergovernmental agreements
• Associations and foundations established under Government Ordinance no. 26/2000, other nonprofit or non-patrimonial associations, political parties, religious groups, which are not registered for VAT purposes according to Art. 316 of Law no. 227/2015 for invoices issued during the period 1 July 2024 to 30 June 2025
• Farmers, who are natural persons, who apply the Special Scheme for farmers provided for in Art. 3151 of the Fiscal Code during the period 1 July 2024 to 30 June 2025
• Supplies of goods and services through retail shops, supplying to the public for which the issuance of fiscal receipts is mandatory
• Supplies of goods and services provided to customers that are not VAT registered (nontaxable) other than nontaxable legal persons for which the issuance of approved legal documents without the buyer’s nomination is mandatory, e.g., transport of passengers based on travel tickets or subscriptions, ticket access to shows, museums, cinemas, sports events, fairs and exhibitions
• Supplies of goods and services provided to customers that are not VAT registered (nontaxable) other than nontaxable legal persons, which by their nature do not allow the supplier to identify the beneficiary, such as: deliveries of goods through commercial vending machines, car parks cash-out and electronic recharging services for prepaid calling cards
Distance selling. For intra-Community distance sales made B2C, a full VAT invoice must be issued. However, if the supplier operates the OSS regime, then no full VAT invoice is required unless requested.
Records. In Romania, examples of records that must be held for VAT purposes include financial documents based on which the VAT statements were prepared, together with the VAT statements.
In Romania, VAT books and records can be held outside of the country. Such documents can be held in or outside of Romania. Records may be held outside Romania, if the records can be made readily available to the tax authorities upon request.
Record retention period. The archiving of the financial accounting documents based on which the VAT statements were prepared, as well as the VAT statements, must be ensured for a period of 10 years (or in the case of immovable capital goods, 20 years).
Electronic archiving. Electronic archiving is allowed in Romania. The taxable person must ensure the storage of invoice copies issued (or issued by the customer/a third party on behalf of the supplier), as well as all invoices received. Invoices may be stored on paper or electronically, regardless of the original form in which they were sent or made available.
The taxable person may decide the place of storage for the invoices, provided such documents are made available to the competent tax authorities without any delays and whenever requested. Nonetheless, such storage place may not be located on the territory of a country with which there is no legal instrument concerning mutual assistance.
By way of exception, taxable persons having the seat of their economic activities in Romania or established in Romania through a fixed establishment must store invoices issued and received, other than electronic invoices, on Romanian territory.
I. Returns and payment
Periodic returns. Taxable persons with annual turnover below the RON equivalent of EUR100,000 (approx. RON500,000) must submit VAT returns quarterly. However, taxable persons who submit quarterly VAT returns must submit monthly VAT returns, effective from the date on which they perform a taxable intra-Community acquisition in Romania. All other taxable persons submit VAT returns monthly.
The due date is the 25th day of the month following the end of the return period. All taxable persons must file their VAT returns electronically. The relevant VAT returns must be signed by the taxable person using a qualified certificate issued by a provider of certification services.
Periodic payments. Payment in full is required by the same date as the VAT return submission deadline, i.e., the 25th day of the month following the end of the return period. All VAT liabilities must be paid in Romanian lei (RON). The payment must be performed through a bank transfer. As of 1 February 2020, the VAT split-payment mechanism no longer applies in Romania.
Electronic filing. Electronic filing is mandatory in Romania for all taxable persons. Submission of VAT returns are performed through means of a digital certificate, which can be obtained only by Romanian individuals based on specific forms submitted with the competent tax administration.
Payments on account. Payments on account are not required in Romania.
Special schemes. Small enterprises. If the turnover is less than EUR88,500 per year, the taxable person can apply the special exemption.
Travel agents. Where the taxable base of the services rendered is the profit margin obtained from the sale of the respective services, exclusive of VAT.
Secondhand goods, works of art, collectors’ items and antiques. Where the taxable base for the supplies of goods is the profit margin obtained from the sale of the respective goods, exclusive of VAT. By way of derogation, for supplies of works of art, collectors’ items or antiques imported by the taxable dealer, the purchase price to be taken into account in calculating the profit margin must be equal to the taxable base on importation plus the VAT due or paid on importation.
Investment gold. This scheme applies to the supplies, intra-Community acquisitions and importation of investment gold, including investment in securities and to intermediary services in respect of supplies of investment gold.
Cash accounting: For taxable persons registered for VAT purposes in Romania and having the seat of its economic activity in Romania, whose turnover in the previous calendar year does not exceed RON4.5 million (approx. EUR900,000), as well as taxable persons established in Romania that apply for a VAT registration during the year and opt to apply the VAT cash accounting system starting with the VAT registration date or at a later date.
Deposit Return Scheme (DRS) system: In 2024, the DRS system was implemented in Romania requiring consumers to pay a RON0.50 deposit (approx. EUR0.10) for beverages in specific packaging (plastic, glass and tin cans) for quantities between 0.1liters and 3 liters. Consumers can reclaim the deposit by returning the containers to designated collection points whereby a voucher is received. Such vouchers can be used in stores or converted in cash.
Starting 1 January 2025, the unreturned DRS packaging is considered to be a supply of goods at the level of the DRS administrator, with the tax event occurring on the last day of the year. The tax base represents the difference between the value of deposits received and returned by the DRS administrator within a calendar year, excluding VAT. If a negative difference occurs during a calendar year (i.e., returned deposits exceed received deposits), the DRS administrator can reduce its VAT position with the corresponding amount in the last VAT return submitted in relation to such year.
Annual returns. Annual returns are not required in Romania.
Supplementary filings. Informative statement. All taxable persons that are registered for VAT in Romania must also submit an informative statement to the Romanian tax authorities. In principle, this statement must include all local supplies and acquisitions performed between taxable persons registered for VAT purposes in Romania made in the reporting period.
The Form 394 includes, inter alia, acquisitions from Romanian persons not registered for VAT purposes in Romania, acquisitions from taxable persons established outside Romania and not registered for VAT purposes in Romania and that do not have the liability to register for VAT purposes in Romania – reverse charge at the beneficiary, etc.
The due date is the 30th day of the month following the end of the period, starting with the July 2016 reporting period. The Form 394 should be submitted to the tax authorities even if no transactions were performed in the reporting month.
Intrastat. A Romanian taxable person that trades with other EU countries must complete statistical reports, known as Intrastat, if the value of either dispatches or arrivals of goods exceeds certain thresholds. Separate reports are required for intra-Community acquisitions (i.e., Intrastat Arrivals) and for intra-Community supplies (i.e., Intrastat Dispatches).
The threshold for Intrastat Arrivals and Dispatches in 2024 is RON1 million (approx. EUR200,900).
Romanian taxable persons must complete Intrastat declarations in RON, rounded up to the nearest whole number.
Intrastat returns must be submitted monthly. The submission deadline is the 15th day of the month following the return period.
EU Sales and Acquisitions Lists. If a Romanian taxable person makes intra-Community supplies or intra-Community acquisitions of goods in any return period, it must submit an EU sales and acquisitions list to the Romanian VAT authorities. The listing of intra-Community supplies or acquisitions is also required for qualifying services that are rendered to or received from a taxable person established in the EU and that are taxed where the beneficiary is established. This list is not required for any period during which the taxable person does not make any intra-Community supplies or acquisitions of goods/services.
The listing of intra-Community sales or acquisitions of goods and qualifying services must be submitted on a calendar monthly basis by the 25th day of the month following the relevant month.
Correcting errors in previous returns. The correction of material errors in the VAT return may be made within the limitation period of five years from 1 July of the year following that in which the return to be corrected was submitted.
Errors made when completing the tax return are considered material errors and are corrected in a specific way. VAT returns submitted by taxable persons registered for tax purposes may be corrected for material errors by the competent tax authority, either on its own initiative or at the request of the taxable person.
The correction of material errors in the VAT return at the request of the taxable person can be performed as follows:
• The taxable person submits the request for correction of material errors together with the documents necessary to justify the errors at the registry of the competent fiscal body or by post, by registered letter.
• The specialized department (the department with attributions for the reimbursement of VAT within the competent fiscal body) will communicate in writing to the taxable person the date, time and place where they must appear, as well as the documents necessary to justify the errors.
• To correct the material errors in the VAT return, the specialized department, based on its own findings or documents submitted by the taxable person, draws up a report in which it records the findings regarding the errors for which the return was requested, as well as how they will rectify these.
• Based on the report, the fiscal body draws up the correction decision, in two copies, one of which is communicated to the payer and the other is archived in its fiscal file.
Digital tax administration. In December 2023, the government issued an emergency ordinance regarding the implementation of digitization projects through the following information systems considered as being of strategic and national interests:
• RO e-Factura: a national system regarding electronic invoicing
RO e-Sigiliu. RO e-Sigiliu is a system developed by the tax authorities with the purpose of ensuring compliance with the traceability of road transport of goods on the territory of Romania. The national system involves the use of electronic devices that record data and transmit to the competent authorities, status and position information through an IT application, to track the movement of goods by road. The application of smart seals and monitoring of road transport of goods on the national territory is carried out by the competent Romanian authorities on the basis of a risk analysis.
RO e-VAT. RO e-VAT is a system developed by the Romanian tax authorities with the purpose of pre-filling information on taxable transactions into the RO e-VAT return for each reporting period.
The pre-filled RO e-VAT return contains data and information regarding economic activities declared by taxable persons and transmitted to the IT systems of the Ministry of Finance and the National Agency for Fiscal Administration (NAFA), namely:
• The national system for electronic invoicing: RO e-Factura
• The national system RO e-Transport
• The national system RO e-Sigiliu
• The national system RO e-SAF-T
• The national system RO e-Case de marcat electronice (i.e., electronic cash registers)
• Integrated customs IT system
• Other information systems of the Ministry of Finance.
The pre-filled RO e-VAT return is implemented as of 1 August 2024, for operations carried out from 1 July 2024, by taxable persons registered for VAT purposes in Romania.
The pre-filled RO e-VAT return is sent via electronic means (Virtual Private Space) by the 5th day of the month following the legal deadline for submitting the VAT return.
In the case of significant differences identified between the values from the pre-filled RO e-VAT return and the values filled in by the taxable person in the VAT return, NAFA notifies the taxable person of them by electronic means, by the 5th of the month following the legal deadline for submitting the VAT return via the form “RO e-VAT compliance notification”.
The term “significant differences” refers to values that exceed the threshold of a minimum of 20% in the percentage rate and an absolute value of at least RON5,000 (approx. EUR1,000) per category of transactions. The threshold is not applicable for the VAT regularisation rows.
The identification of significant differences is based on the VAT amounts included in the VAT return filed by the taxable person and the pre-filled RO e-VAT return. For transactions without VAT, the checks are carried out by comparing the taxable base amounts.
After receiving the pre-filled RO e-VAT return, taxable persons verify the pre-filled data and information in accordance with the taxable operations carried out and their actual fiscal situation. Taxable persons are required to electronically send the outcome of the checks performed on the differences identified in the Ro e-VAT compliance notification within 20 days from the receipt of the notification.
Not providing or partially providing information to clarify the discrepancies represents a fiscal risk indicator for the Romanian tax authorities (for additional details refer to section J. Penalties).
The RO e-VAT compliance notice will not be provided by the tax authorities:
• In the case of material errors.
• If there is not enough information in the tax authorities’ databases for certain types of transactions.
• Other situations provided by the tax authorities.
The company’s directors may be held jointly liable with the debtor, if they caused, in bad faith, the non-declaration and/or the nonpayment of due tax duties.
Also, both the persons in the management and the supervision of the legal person (i.e., administrator, director, auditor), as well as any other persons (e.g., the shareholders, financial service responsible, heads of departments, accountants) who have determined the insolvency of the company can be held liable.
Statute of limitations. The statute of limitations in Romania is five years. The tax authorities may normally check tax-related matters retroactively for five years. In the case of fiscal evasion or fraud, the reassessment period is extended retroactively for 10 years. The five-year statute of limitation period begins to run from 1 July of the year following the year for which the tax obligation is due.
Generally, a tax audit should be performed only once for each tax or duty or other amounts due to the State Budget and for each period subject to taxation. However, the tax authorities are entitled to reverify a certain period in if additional information or errors of computation that influence the results, of which the tax inspectors were not aware when performing the initial audit, arise between the completion of the fiscal audit and the expiry of the above reassessment period.