A little-known fulfillment, many times underestimated in importance in Romania, concerns the Declaration forms 205 and 207, which, however, despite their low popularity, play a role of great importance in view of the implementation of DAC6 and the tax planning of Italian entrepreneurs in Romania. In particular, the critical issues related to the Tax Declarations of resident and nonresident recipients of income obtained in Romania (205 and 207) concern two orders of problems: the choice of the formalized and conscious tax residence of the recipients of income with Romanian source (partners, directors etc) and the management of foreign service providers who carry out their activities in Romania.
Statement 205 is the Information Statement related to withholding tax and profits/losses realized by the tax resident beneficiaries in Romania of the source of income.
The return is completed and submitted by Romanian taxpayers JURIDICAL PERSONS who are obliged to calculate, withhold and pay income tax under the withholding tax regime, pursuant to Title IV of Law No. 227/2015 on the Tax Code, as amended and supplemented, for the following types of income: income from dividends; income from interest; income from the liquidation of a legal entity; income from pensions; cash prizes; income from gambling; and income from other sources.
Deadline for submission of statement 205.
The declaration must be completed is submitted annually:
(a) by the last day of February, including the current year for the past year (note, here is a change from 2020, when the deadline was the last day of January).
(b) whenever the taxpayer finds errors in the previously filed return, completes and submits an amended return.
Statement 207 represents the “Information Statement concerning withholding tax on income disbursed or exempted from tax having non-residentnatural or legal persons as beneficiaries.”
Declaration 207 is filed by Romanian taxpayers JURIDICAL PERSONS who are obliged to calculate, withhold and pay income tax under the withholding tax regime in accordance with Title VI of the Tax Code or conventions for the avoidance of double taxation concluded by Romania with other states, with respect to income from dividends, interest, royalties, commissions, income from the provision of services performed on the Romanian territory, income from independent professions, income from consulting or management services provided both on and outside the Romanian territory, remuneration received by legal/physical persons as a director or member of the board of directors, income from the liquidation of a Romanian legal person.
Deadline for submission of statement 207.
Declaration 207 like 205 has a due date of February 28 of the current year for the previous year.
Penalties.
Since they are included in the category of information returns, their non-submission is punished with a fine of 12,000 lei to 14,000 lei for medium and large taxpayers, respectively with a fine of 2,000 lei to 3,500 lei for small taxpayers.
Tax registration of non-residents.
Non-residents who obtain income from Romania as above are required to register for tax, which is done by filing returns 015 (for legal entities) or 030 (for individuals). These forms will be accompanied by supporting documents related to the income obtained from Romania, such as service contracts, administration contracts, assignment contracts, loan contracts, etc. Foreign companies/companies performing services in Romania must compulsorily submit to the Romanian principal a tax residence certificate for the year the services were performed in Romania.
We remain available for further clarification
