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New margin for inland per diem

As of January 27th2015, modifications stipulated by the Ordinance no. 60/2015 have come into effect for an updating of the level of per diem allowances for daily postage and travel, as well as of the amount representing the compensation of accommodation expenses for travelling staff in case such staff does not benefit from accommodation in touristic lodging structures, which are stipulated in the Government Decision no. 1860/2006.

In case of staff of public institutions, the travel allowance shall increase from RON 13/day to RON 17/day.

ATTENTION! As of February 1st2013, regardless of the status of the employer (payer of corporate income tax, payer of microenterprise tax, self-employed person, sole trader, NGO), the allowance paid to employees during the postage or travel to another place, in the home land or abroad for business purposes, which exceeds 2.5 times the legal level that is established for employees of public institutions:

  • is subject to wage tax;
  • is included in the monthly calculation basis of social compulsory contributions.

CONCLUSIONS:Per diemallowances that can be granted in case of the aforementioned type of business, so that it would not be classified as wages and salaries, increases from RON 32.5 / day to RON 42.5 / day.

ACCOMMODATION EXPENSES

In case the staff of public institutions who is under postage is not accommodated under the conditions stipulated under art. 26 of the Government Decision 1860/2006 (at a three-star hotel or inn), accommodation expenses shall be compensated by the payment of an amount of RON 45, for each night, instead of RON 30, as stipulated until the date of this modification.

New regulations regarding the 9% reduced VAT rates for tourism services

The Official Gazette No. 46 of January 20, 2015 published the Government Decision no. 20/2015 for the modification of par. (6), point 23 of the Title VI “Value Added Tax” from the Methodological Regulations for the Application of the Law no. 571/2003 (Fiscal Code).

As of January 20th 2015, the 9% reduced VAT rate stipulated under Art. 190, par. (2), point “f” of the Fiscal Code is applicable for types of accommodation available in touristic facilities that are designed for such purpose, namely:

a) Accommodation without breakfast;

b) Bed and breakfast – a pre-established combination of accommodation with breakfast, which is sold for a total price;

c) Half-board – a pre-established combination of accommodation with breakfast and lunch or breakfast and dinner, which is sold or offered for sale for a total price;

d) Full-board – a pre-established combination of accommodation with breakfast, lunch and dinner, which is sold or offered for sale for a total price;

e) All-inclusive – a pre-established combination of accommodation with breakfast, lunch, dinner, snacks between meals and any other touristic entertainment services that are provided by one’s own touristic means, which are designed for guests, provided that such combination is sold or offered for sale for a total price.

The 9% rate is applicable also in case the exact cost of such operations is charged further (by applying an intermediate or placement structure), except for cases in which it is compulsory to apply the special fee status of tour operators.

At this time, the reduced rate of 9% can be applied both by hotels that sell directly the aforementioned types of accommodation, as well as by tourist agencies that purchase such packages and sell them further with the same value to final consumers.

As a result, if no other provisions appear, which allow tourist agencies to apply a reduced VAT rate of 9%, including for their fee, this provision shall be useless for them.

DeBizz Businessbörse

DeBizz, the sole business magazine from Romania that is edited in German language organizes a monthly business networking event: Businessbörse.

DeBizz Businessbörse is a short, clear and comprehensive event, solely dedicated to ensure interaction between businessmen and women, representatives of companies with romania, german, austrian and swiss capital, as well contacts with the most important foreign inverstors.

The second edition of this year takes place on February 14, 2015, at the headquarters of the DeBizz business magazine, in Bucharest, Blvd. Tudor Vladimirescu no. 22, Green Gate Offices, 5th floor.

The number of participants is limited to 30, admittance is processed on a first come, first served basis.

DeBizz is targeted at business persons, diplomats and politicians from Germany, Austria and Switzerland who are active in Romania.

Over 3000 people with decision power read our magazine monthly, so that they obtain information about the business environment, economy and finance issues, politics as well as on any other matters of interest and news from the Romanian Government, European Commission, European Council, European Parliament and other institutions.

The only German business magazine from Romania is owned by the businessman Corneliu-Teofil Teaha and it is part of the company group Teaha Holding

Register here: debizz.ro-boerse

Tax evasion in Romania has a safe future

We can rest assured, tax evasion in Romania has a safe future: according to tax authorities, our children are already great tax dodgers!

Anywhere in the world, such a blunder would have ended in several dismissals! But this is not the case in a country where the revenue office claims that, out of the RON42 that children receive monthly as state allowance, they are to pay back RON 39!???

The local Revenue Office of Arges has sent notifications, by which they announced almost 11,000 children in their county, including disabled minors, that they have to pay overdue contributions to the public health insurance system, because of the allowances they receive from the state. This news has circled around all news channels of our country in the first week of 2015 and it has also been a delight for the press abroad!

Tax authorities of Arges consider that child allowances are income, so they have to pay a health insurance!

The representative of the tax authority are looking in vain for excuses, when they say that it is the fault of the software, which identified the children as being indebted to the state and that tax assessments have been generated due to the operation of software issued by the General Service for Information Technology of the National Agency of Tax Administration (ANAF). This allegation comes after they initiallytried to explain that this is a tax on bank interest that has been generated due to the fact that child allowances have not been taken from bank accounts in 2012. Please communicate to me the name of the bank that grants such an interest, given that the 16% tax amounts to RON 39, which means that the annual interest is of RON 234.75, for monthly deposits of 42 RON! Please take your time if you want to make a list of such banks!

The local press of Alba has informed that several parents have received at home overdue notices from the Revenue Office, for the payment of arrears related to their minors, whereas notices referred to income obtained in 2012 from “investments” as well as to health insurance contributions.

While the Romanian state treats this way its citizens and their children, let us see the policiesof other states from Europe on the subject of child allowance that is granted by the state.

The simplest version in the EU is the establishment of a uniform amount for each of the first two children, with a slight increase for the next. Examples are Germany (with 184 euro for the first two children, then 190 euro, followed by 215 euro) and Ireland (140 euro and then 148 euro).

Outsidethe EU, Norway follows a unitary value of 129 euro plus an additional allowance of 42 euro for Nordic regions.

There is also a variant preserving the principle of equality, yet benefits are differentiated according to the age of the child.

For example, in Denmark there are granted 145 euro for children between 0 and 3 years old, 131 euro for those between 3 and 7 years old and 103 euro for those between 7 and 18 years old.

In return, children of Holland receive a higher allowance when they grow older, starting from 58 euro when under 6 years old, 70 euro between 6 and 11 and 82 euro between 12 and 17.

Most of the states follow an increase of benefits for children, some of them with quite sharp curves.

Belgium grants 77 euro monthly for the first child, 143 euro for the second and 212 euro for the third and the following. Finland observessocial protection principles even in greater detail, by paying100 euro for the first child, 110 euro for the second, 131 euro for the third, 151 euro for the fourth and 172 euro for each of the following (the allowance is to be granted for all children and the difference is the one booked as additional amount of money).

An exception makes Great Britain, which opted for a decrease of benefits in case a family has several children (105 euro for the first child and 70 euros for each of the next children).

Interestingly enough, France does not grant any allowance for the first child of a family, although it pays quite high amounts for the second (approximately 120 euro per month) and the third child (approximately 155 euro per month). This suggests that the state encourages birth rate only from the point when the population level is recovered and not necessarily under any conditions (statistics indicate that 2.1 children per family are necessary in order to maintain the population level).

The only country where the amounts granted by the state for children depend on family income is Italy. Support is very consistent if parents gain under 1,000 euro / month (250 euro monthly for each child), it drops under 40 euro monthly for family income of up to 2,500 euro per month and it disappears above this margin (amounts stem from the approximate conversion of annual gains).

Romanian tax climate

Romanian tax climate improves this year,  state tax collection still unsatisfactory 

Tax authorities of the European Union as well as those across the ocean have lately intensified their efforts to identify allsources of taxation of all their tax payers, irrespective of the place where such income is obtained. A further step is to tax such income at the place of the fiscal residence of each tax payer. In order to achieve this goal, tax authorities have pledgedto offer mutual support by a permanent exchange of information. Romania also entered this project, as a member of the European Union. The advantages of this approach have remained unclear for Romania for the moment, as the local tax authorities here are still facing great problems upon collecting taxes in their homeland!

As the Finance Ministry has not been able to collect enough of the taxes due, the corporate world fears that it is going to raise the taxation level in 2015, under the cumulated pressure exerted by several factors: commitment to diminish the deficit to 1.4% from GDP, decrease the health insurance by 5%, necessarily increase defense costs, as a result of political developments in the area, co-financing of projects under contract, amounting to an estimated deficit total of 15 to 20 billion RON.

A decrease of the VAT rate is necessary! But are we able to sustain this?

An increase in the tax burden would be a counterproductive measure that would be utterly unjust for those paying their taxes duly. I don’t think Romanian fiscal authorities are not aware of the fact that there is a direct relationship between the level of taxation and the degree of voluntary conformation, translated into the tax payers’ capacity of paying their taxes in the right amount and in due time. A simple demonstration is offered by the collection of output VAT, which is our weakness. In 2013, we had an efficiency degree of 56% in the application of VAT rules, whereas our Bulgarian neighbors registered a rate of 73%. As a result, with a tax rate of 24%, we collected output VAT reaching 8.74% from GDP and Bulgaria, with a rate of only 20%, reached 9.22% from their GDP! This clearlyproves that, in the long run, lower taxes bring more money to the state treasury! Unfortunately, it is easier for the Finance Ministry to increase tax rates than to make the effort of collecting duetaxes!

There are also achievements!

The report „Paying Taxes 2015” marks Romania’s ascension by 76 positions in a top monitoring the activity of tax authorities from 189 economies of the entire world. As a result, Romania enjoys the highest advancement of 2015!

The improvement of the relation between the National Revenue Office and the tax payers is due to several projects, among which the following are worth mentioning: an extension of the online registration and payment of tax liabilities, the project regarding the informatization of the Internal Revenue Office, developed in partnership with the World Bank and aiming at an increase of the efficiency in collecting taxes and social contributions, fiscal discipline and an a reduction in bureaucracy.

Compared to the data from last year, „Paying Taxes 2015” highlights the following issues:

  • The number of hours needed for paying taxes diminished from 200 to 159 hours at present;
  • The number of payments / year diminished from 39 to 14.
  • The share of taxes in the total corporate income increased slightly from 42.9% to 43.2%.

Compared to the states of the Central and Eastern Europe, Romania registered the greatest progress inincreasing the efficiency of tax collection over the past two years and it is ranked now above countries such as Hungary (88th place), Poland (87th place), Czech Republic (119th place), Slovakia (100th place) or Bulgaria (89th place).

Tax information course for expats living in Romania

Do you belong to one of the expat categories?

  • Employee
  • Entrepreneur
  • Foreign investor
  • Consultant/ freelancer
  • Interested in opening a business in Romania

Here you find the information you need:

  • How, where and why you have to register in order to pay your tax liabilities in Romania
  • What you have to do in case you receive an overdue notice
  • How you can receive specialized assistance for your relation to Romanian authorities

Investment: 100 RON + VAT / participan

YES! I want to register!

Register the participation code teaha# and you will receive 10% discount for the services of Teaha Management Consulting

BONUS for all participants:

  • Rentrop&Straton– the first 40 persons registered receive a copy of the book “The Romanian Tax Green Book” – in English!
  • 4CAREER – a career counseling and orientation session(in Romanian)for 3 participants, granted by prize draw.
  • Teaha Management Consulting – an hour of tax consulting, FREE OF CHARGE

YES! I want to register!

Register the participation code teaha# and you will receive 10% discount for the services of Teaha Management Consulting

Register directly at:

  • Cristiana Radu, Marketing Manager, Teaha Management Consulting
  • E-mail: cristiana.radu@teaha.ro
  • Phone: +40761.581.189

Book launch of „Alois Mock – a politician writes history”

On the occasion of the 25th celebration of the fall of the Iron Curtain, the Romanian-Austrian Friendship Association organized on the 15th of October 2014 an event for launching the Romanian translation of the book “Alois Mock – a politician writes history”,a biography written by Dr. Martin Eichtinger, former ambassador ofthe Republic of Austria in Bucharest, together with the historian Helmut Wohnout,

The Austrian Ambassador to Romania, His Excellency Gerhard Reiweger and Dr. Martin Eichtinger, the author of the book “Alois Mock – a politician writes history”, as well as other personalitiesof theacademic, diplomatic and cultural environment have been present at the launching event.

The guests were also invited to enjoy the exhibition “Travel in No-man’s Land”, with snapshots along the Iron Curtain, taken by the well-known Austrian photographer Kurt Kaindl.

The book launch was organized by the Romanian-Austrian Friendship Association, under the patronage of the Austrian Embassy and with the help of the Austrian Cultural Forum.

Teaha Management Consulting, in partnership with in Rolang School, organizes a tax information course designed for expats living in Romania

The course will be held by Janina Popescu, officially authorized trainer and Payroll Manager of Teaha Management Consulting.

Date: October 29, 2014
Time: 18.30
Place: Teaha Management Consulting Office 
Green Gate Offices
Tudor Vladimirescu Boulevard 22, 5th floor (view the map)

Students will learn about:

  • The rights and obligations of an expat in relation to the Immigration Office
  • How, where and why they have to register for the payment of their tax liabilities in Romania
  • What they should do in case they receive an overdue notice
  • How they can obtain professional assistance for their relation to the Romanian authorities

The course is designed for expats that are

  • Employees
  • Entrepreneurs
  • Foreign investors
  • Consultants and freelancers
  • Any person who is interested in starting a business in Romania

Investment: 70 RON / student

Registration with:

Cristiana Radu, Marketing Manager, Teaha Management Consulting

E-mail: cristiana.radu@teaha.ro

Phone number: +40761.581.189

or fill in this form:

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BONUS for all participants:

  • 15% discount on consulting services TMC
  • 10% discount on Rolang School services
  • 1 session free for the beginner level offered by Rolang School

They choose Teaha Management Consulting:

Voestalpine Group

Teaha Management Consulting becomes the affiliated partner of the international network mgi

MGI, the greatest international alliance on the market of independent financial and fiscal consulting is launched in Romania, as well. In this alliance, our country is represented by TEAHA MANAGEMENTCONSULTING, a company that has been set up in 1997 and has at present 100 employees who generate a turnover of ca. 2 M euro and operational offices in Bucharest, Cluj, Timisoara, Sibiu, Brasov and Chisinau.

The signing of the affiliation contract has come as a natural step after a previous collaboration between the two parties and shall take the form of a strategic alliance, based on which the local company shall benefit from the international expertise of the network.

The affiliation of TEAHA MANAGEMENT CONSULTING to the prestigious international network offers the local clients access to one of the greatest global networks of independent financial and accounting consultants and thus ensures them of the entire support for the development of their business to a highly competitive level. At the same time, this offers international clients more opportunities for the planning and implementation of their businesses in the Eastern and Central Europe.

“Our decision to conclude a partnership with the company Teaha Management Consulting was based on a series of reasons. First, the entrepreneurial initiative of Mr. Corneliu Teofil Teaha in 1997 was a very daring action, which became a recipe for success. Apart from that, the client portfolio, the team of experts and exceptional business achievements have been the other important reasons.” declared Mr. Clive Viegas Bennet, mgi European Executive Director.

“We intend to persuade as many as possible local and international clients who carry out complex projects to choose standardized financial and fiscal services, which offer a major advantage: a quick implementation of every project at an international level”, added Jan Nygaard, Chairman of the mgi European Area Coordinators.

The affiliation process lasted more than a year, during 2009 and 2010. In Romania, the representatives of mgi carried out a selection process at the level of the entire country, which was concluded by choosing the company that was considered to have the highest development potential.

Corneliu Teofil Teaha, Managing Partner of TEAHA MANAGEMENT CONSULTING, emphasizes the competitive advantages that are brought to the Romanian clients by this affiliation: “We are simply proud of our strategic affiliation to mgi. We cannot feel otherwise than honoured that the work standards we have imposed as a 100% Romanian company fulfil the quality requirements of this international network. In our new capacity, we can offer our clients the know-how and experience of one of the largest global networks of independent consultants from the field of financial and accounting services, which shall help them reach their business goals by a business concept that is compliant with international quality standards”. “Also, it is very gratifying that our expert team will have access to trainings and opportunities of professional development, which shall lead to a consistent improvement of our clients’ results, as they will be up to date with the newest trends on a global level”, concluded Corneliu Teofil Teaha.

TEAHA MANAGEMENT CONSULTING is the first company of the Teaha group. This company was incorporated in 1997, by Corneliu Teofil Teaha. It is the biggest financial and accounting consulting company with a fully Romanian capital and it owns a market share of about 2%, in the context in which over 80% of the market in this field if owned by the “big four”. During its over 10 years of activity, the company has undergone a remarkable development. At present, it prides itself with a turnover of ca. 2 million euro. The company is active by means of a network of associated companies from Bucharest, Cluj, Sibiu, Brasov and Timisoara and has about 100 employees. Teaha Management Consulting is auditor of the Swiss-Romanian Commerce Chamber and of the Romanian Club of German Businesspersons.

mgi is one of the greatest international alliances on the market of independent financial and fiscal consulting. It was founded in 1947 and it is present in 80 countries, by 288 local offices. The companies that are affiliated to mgi are generally medium-sized businesses with excellent knowledge of their local markets.