Last updated: 12 February 2015
In order to implement a decision of the Constitutional Court regarding the exemption of disabled persons from the payment of income tax for revenues obtained from independent activities, but also in order to clarify certain aspects regarding VAT, in January the Romanian Government passed Ordinance no. 4/2015, published in the Official Journal no. 74 of January 28, 2015, in force since February 1 st , 2014.
This Ordinance reinstates a provision regarding the payment of VAT for intercommunity purchases and provides exemptions from the payment of the income tax for certain categories. These changes are presented to you hereinafter.
RULES REGARDING VAT
According to the Ordinance, beneficiaries who purchase goods and/or services from Romanian taxpayers whose VAT registration was annulled are not entitled to deduct the VAT corresponding to such operations, except for the purchase of goods performed during forced execution procedures or of goods from taxpayers subject to bankruptcy procedures.
Moreover, given that Ordinance no. 92/2014 erroneously repealed article 151 of the Fiscal Code, according to which persons who performed an intercommunity purchase of taxable goods had to pay the corresponding VAT, the Ordinance reintroduced this provision, at article 150.
In accordance with this article, any person who performs an intercommunity purchase of taxable goods has to pay the corresponding VAT in Romania. If the person who has to pay the VAT is a Community taxpayer, but is not a taxpayer in Romania, it can appoint a fiscal representative, as the person liable to pay the tax.
If the taxpayer is not established in the Community, it has to appoint a fiscal representative, as the person liable for the payment of the tax.
EXEMPTION FROM THE PAYMENT OF THE INCOME TAX
Revenues obtained from independent activities, individually and/or under the form of an association by severely disabled natural persons, as well as salary and old age pension revenues obtained by such persons are exempted from the payment of the income tax.
Furthermore, revenues obtained by disabled persons from agricultural activities, forestry and fishing, individually or under the form of an unincorporated association are exempted from the payment of the income tax.
These provisions implement a ruling of the Constitutional Court, under which disabled persons who obtain revenues from independent activities have to be subject to the same legal regime as the other disabled persons who obtain salary revenues, who were exempted from the payment of the income tax