Romania: Limited deductions concerning receivables | KPMG | GLOBAL

Romania: Limited deductions concerning receivables; tax rules for representative offices

Romania: Limited deductions concerning receivables

New measures in Romania’s tax law have been enacted and generally are effective 1 January 2018.

1000

Related content

Ordinance no. 25/2017 was published in the official journal on 31 August 2017, and includes the following tax provisions:

  • Corporate income tax—deductions of expenses incurred in relation to the disposal of receivables are limited to 30% of the receivable’s value (under current law, such expenses are fully deductible)
  • Taxation of foreign representative offices—The amount of tax due will be RON18,000 (the tax currently is €4,000), and there are changes to the rules for when such taxes must be paid (no longer will they be allowed in installments, and must be paid within 30 days of the date when a new representative office is established or when a representative office is closed).
  • Income derived from “independent activities” conducted in Romania (except for income derived from intellectual property) will be considered to be Romanian source income regardless whether it is obtained from Romania or from abroad. Income from intellectual property will be considered to be Romanian sourced only if it is obtained from a Romanian income payer or from a nonresident through a permanent establishment in Romania.

There are also new measures concerning individual (personal) income taxation.

 

Read a September 2017 report [PDF 355 KB] prepared by the KPMG member firm in Romania

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us

 

Request for proposal

 

Submit