In the Official Gazette no. 584 / 21.07.2017 was published the Law no. 177/2017 regarding the approval of Government Emergency Ordinance no. 3/2017 for amending and completing the Law no. 227/2015 regarding the Tax Code (Law)
Here is a summary of the amendments made to the Tax Code by Law no.177 / 2017
a) Micro-enterprise and specific tax
It clarifies the regime of companies that recorded incomes between EUR 100,000 and EUR 500,000 as of December 31, 2016, and are subject to specific activities (bar, restaurant, hotel, etc.) according to the Law no. 170/2016 on the specific tax:
The normative act analyzed comes and clarifies the situation of these companies:
- Renounce the capacity of a taxpayer on 31 July 2017, having the obligation to modify the tax vector until 25 August 2017;
- Still until August 25, 2017, must complete the calculation of the corporate tax for the period 01 January - 31 July 2017 and submit the tax returns for the profit tax;
- The specific tax is due for the period from January 1 to July 31, 2017, the law introduces a derogation from the usual way of calculating the specific tax in the sense that it is calculated for a number of days corresponding to the first 7 months, reported to a total of 365 Days (in proportion to the number of days in the first 7 months in a year); Of course, he declares and pays up to 25 August 2017;
- Starting August 1, 2017, those companies that earned between € 100,001 and € 500,000 on December 31, 2016 will pay tax on the micro enterprise's income and no longer pay a specific tax due to the fact that the other correlation conditions for a micro-enterprise with respect to social capital, object of activity, etc.
b) Associations of owners which are profit tax payers.
A new category of profit taxpayers is introduced, which is listed in the Tax Code, ie some owners' associations (not all);
Owners' associations have legal personality and are in the field of corporate profit tax only for some income categories.
Thus, the law comes and defines that the owners' associations are not profit taxpayers for the income from the exploitation of the common property. For example, an owners association collects money from households on the premises and pays utility services. For this situation, the owners' association does not have the quality of profit tax and does not owe the registration to the tax authority.
However, if the owners 'association has other economic activities, such as the purchase of shares on a stock exchange, the establishment of a shop through which it markets goods, for these types of income, the owners' association has the status of a profit taxpayer.
Of course, it will be necessary to observe the submission of the annual corporate profit tax return until 25 February of the following year.
c) Degraded goods, inventory minuses, non-imputable, deductible expenses.
It is regulated more precisely in what conditions the missing assets from the inventory, degraded and non-imputable are non-deductible expenses in the calculation of the profit tax;
The current situation under the Fiscal Code is preserved, when it is possible to deduct the expense for the missing goods in inventory, which are not imputable as a result of force majeure, destroyed goods when proof of destruction, and goods for which the validity period has expired, and goods for which there are insurance contracts.
The law extends to deductible expenses, the value of the goods in the period of validity, but which will be used according to the law for combating food waste (goods that are granted to entities provided by the law on combating food waste when it will come into force).
d) Medical subscriptions paid by the employer, capped at 400 euros per year.
The following categories are expanding: income not taxed at the income tax on salaries for the health subscriptions supported by the employer, up to a maximum of 400 euros per year; Other categories of non-taxable incomes are expanding;
The legislator grants employers the right to reimburse health insurance and medical subscriptions to private units, for each employee, up to a ceiling of 400 euros per year, without considering these costs as salaried income to the employed person.
We note that compared to the February 2017 amendment, when they were considered non-taxable at the salary tax calculation, the medical subscriptions paid by the employees from the personal money, the new regulation considers as non-taxable in the calculation of the salary tax the medical subscriptions paid by the employers and registered as expenses for their own employees, capped at 400 euros per year.
We appreciate this measure as one of the best in the field of health financing, meaning that a large number of employers will settle these types of subscriptions to private hospitals, in which case the public system will decongest and, for the employees will be a prevention opportunity for possible illness, and a wage bonus.
e) The generating event of VAT - deliveries / services with continuity.
In the field of value added tax, several articles on the VAT generating event are being reformulated, especially for continuity activities such as electricity supplies, telephone services, rental, lease, etc.;
As a general rule, the VAT-generating event occurs at the time of delivery of the goods or when the services are rendered. The Fiscal Code introduces several exceptions, one of which being the generating event for the supply of goods / services of a continuity nature.
For gas, water, electricity or telephone services, or for rental, concession, lease or leasing services, the generating event is deemed to have been made at the time accepted in the contract for the payment of those goods or services.
If the parties did not expressly provide for a payment date, in this case the generating event occurs at the date of issue of the invoice, without the settlement period exceeding 1 year.
f) VAT adjustment for loss of claims arising from customer insolvency and bankruptcy - the timeframe in which the reversal invoice can be made.
From the point of view of the value added tax, VAT adjustment in favor of the taxable person for the loss of receivables due to the bankruptcy of the client or the insolvency can be done within 5 years from January 1 of the following year To the one in which the final decision of the court was pronounced;
A taxable person registered for VAT purposes who has incurred losses from receivables generated by the approval of a client's reorganization plan in insolvency proceedings or loss of receivables is the result of bankruptcy of the client, has the right to adjust VAT in favor of it by issuing an invoice Reversal for the taxable amount and for the VAT initially collected, corresponding to the loss incurred.
The period within which the reversal invoice may be issued shall be 5 years starting with the 1st of January of the year following that in which the "court decision confirming the reorganization plan, namely the court order closing the insolvency proceedings".
In essence, the term is not a new one, as it is stipulated in the norm for the application of the Fiscal Code, adopted by GD no. 284/2017 (Official Gazette No 319 of May 4, 2017). Novelty consists of introducing the term directly into the Fiscal Code. Also, as a novelty, the term "definitive and irrevocable decision" disappears from the Fiscal Code. This means that the term is counted from the year following that in which either the approval of the insolvency plan or the bankruptcy, even if they are not final.
g) The removal of the phrase "does not justify economic intent and capacity" from the Fiscal Code in order to be a VAT payer when the tax authority cancels the VAT code.
It is Improved the condition by which the tax authority cancels the taxpayer's VAT code from the point of view of "justification of economic intent and capacity". This phrase is abrogated and the VAT registration will be canceled if the company has "high tax risk".
Starting from the provisions of art. 316 par. (11) lit. H) of the Fiscal Code, which allowed the tax authority to cancel the VAT code because "it does not justify economic intent and capacity", many taxable persons had the VAT code canceled on more or less transparent criteria set by ANAF.
This phrase disappears from the Fiscal Code and is replaced in the sense that a company can have canceled its VAT code if it has "a high fiscal risk". ANAF establishes by order of the President the conditions for the identification of high fiscal risk.
h) In the field of excise duties, there are some important changes to the right to carry out certain activities with excisable products, only subject to the possession of specific authorizations
Authorizations in the field of excise duties and republishing of Annex no. 1 to the Fiscal Code with excise value for the years 2017 - 2022.