VAT

Published on Oct 28, 2021 by LPG

REGISTRATION FOR VAT PURPOSES IN ROMANIA

Registration for VAT purposes in Romania is mandatory as soon as the company has a turnover of over RON 300,000 (approximately EURO 65,000) per year. Below this amount, registration is optional.

REGISTRATION FOR VAT PURPOSES AT INTRA - COMMUNITY LEVEL

Registration for VAT purposes at intra-Community level is mandatory for all companies performing an intra-Community operation:

  • either the purchase or sale of a service from another company in the European Union;
  • either intra-Community acquisition or delivery.

INDEPENDENT PROCEDURES  

Registration for VAT purposes at intra-Community level and registration for VAT purposes in Romania are procedures independent of each other.

In this manner, a Romanian company can be subject to VAT in Romania without being subject to VAT at intra-Community level (this is the case, for example, of a Romanian company achieving a turnover above RON 300,000 without performing international operations) or, on the contrary, subject to VAT at intra-Community level without being subject to VAT in Romania (this is the case, for example, of a Romanian company that performing international operations without achieving a turnover above RON 300,000).

A Romanian company subject to VAT at intra-Community level without being subject to VAT in Romania is in a situation where:

  • it sells its products and services to other European companies without taxes, i.e. without the application of VAT in Romania  
  • it purchases its products and services from other European companies without taxes, but will then have to pay VAT in Romania (at a rate of 19%) for these products and services purchased in this manner (VAT which otherwise will not be deductible, as the company is not subject to VAT in Romania).

When a Romanian company is subject to VAT at intra-Community level in the beginning (as it performs international operations without achieving a turnover above RON 300,000) and then is subject only to the national VAT regime (as it achieves a turnover above RON 300,000), the Romanian tax procedural rules compel it to resume its registration procedure for VAT purposes at intra-Community level in order to obtain a new intra-community VAT registration number.

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