Referring VAT split payment the Romanian Senate has approved and further on passed on the amended law related to the VAT split payment system to the Deputy Chamber (i.e. the second institution within the Romanian Parliament that has decisional powers in fiscal matters). According to the amended provisions of the law, the system shall be mandatory as of January 1st, 2018 for taxable persons and public institutions VAT registered in Romania which fall within one of the following situations:
- The outstanding VAT liability as of December 31st, 2017 is higher than RON 1,500 (for large taxpayers), RON 1,000 (for medium taxpayers), RON 500 (for small taxpayers) or RON 100 (individuals). From such category are excluded taxpayers that obtained a payment rescheduling;
- As of January 1st, 2018 the outstanding VAT liability unpaid for more than 30 days exceeds the same thresholds mentioned under point 1 above. The exception related to the outstanding liabilities for which a payment rescheduling has been obtained is applicable also in this case.
- Are under the insolvency prevention or insolvency procedures.
For the remaining categories of taxpayers which do not fall under one of the above mentioned provisions, the system remains optional.
Those that apply the VAT split payment mechanism may withdraw from the system under the following conditions:
- Taxpayers that fall under point 1 or 2 above may withdraw from the system after minimum 6 months as of the date when no outstanding VAT liabilities are held within the limits provided by the law, through the submission of a notification;
- Taxpayers that fall under point 3 above should be withdrawn from the system after they are no longer under the insolvency prevention or insolvency procedures in 5 days as of the submission of the notification, to the extent that they do not also fall under the rules related to outstanding VAT liabilities;
- Taxpayers that voluntarily applied the VAT split payment mechanism may opt to be withdrawn from the system at the end of the fiscal year, but no sooner that one year from the date when the company was published within the Registry of taxpayers applying the VAT split payment system, to the extent that they do not also fall under the rules related to outstanding VAT liabilities.
As per the revised version, the VAT split payment mechanism will also affect the taxpayers that do not apply the system from the perspective of the goods / services acquired from suppliers that fall under the system. This is because, they will be required to pay in two separate accounts, namely in the current account the value of the taxable amount, as well as in the VAT dedicated account the VAT amounts starting with January 1st 2018.
Bildquelle: Alexandra Bucurescu / pixelio.de