The VAT status has changed as of January 1st 2015 for electronic services of taxable persons who are registered for VAT according to art. 153 of the Fiscal Code, delivered to natural persons or tax-free persons from the European Union.
If invoices have been issued with Romanian VAT of 24% so far, they nevertheless have to be issued with the VAT rate that pertains to the beneficiary i.e. that of the member state of consumption.
In order to declare such operations, there are two options:
- Registration for VAT in each separate country and filing tax returns in such country.
- Registration with the National Revenue Office in M1SS (Mini One Stop Shop) and filing VAT returns quarterly on this website. VAT shall be paid to a special account from which it is going to be transferred to such countries.
Considering that the first option is difficult to achieve, there remains the second, that of the registration in the Mini One Stop Shop (M1SS) system.
The system represents a simplification measure taken as a result of the fact that VAT regulations have been modified regarding the place of service delivery, this meaning that the delivery takes place in the member state of the customer and not in that of the supplier, which allows one to avoid registration in each member state of consumption.
In order to be registered in the M1SS system it is necessary to receive a certificate for digital signature, which is the same as the one used for the electronic filing of the other tax returns. The registration takes place on the web site of the Internal Revenue Office at the address www.anaf.ro.
Invoices shall be issued with the VAT rate from the country of the beneficiary, who is a natural / tax-free person and the accounting registration shall be as follows:
4111 Customers = 707 Sale of goods purchased for resale
4427 Output VAT
Output VAT shall be offset by the account 447, as tax is due in the member states of consumption and not in Romania:
4427 Output VAT = 447 Special funds – taxes and similar liabilities
By payment, the account 447 shall be balanced as follows:
447 Special funds – taxes and similar liabilities = 5124 Cash at bank in foreign currencies
The VAT return 399 form has to be filled in until the 20th of the month following the relevant reporting quarter. The return form is entitled “Special return form according to the Fiscal Code, Art. 152.4, par. (7) and 152.5, par. (6)” and it can be downloaded from the address https://static.anaf.ro/static/10/Anaf/Declaratii_R/399.html. The tax return 399 is to be filed even if no operations have been made and no amounts are to be declared for the quarter in question.
The VAT return 399 shall be filled in in euro, cumulated for each separate state of consumption and the member state of consumption shall be mentioned, as well as the VAT rate, the tax basis and the amount of VAT. After the form is validated and it is proven to be error-free, it is filed in an electronic form on the website of the National Revenue Office. The note received as a result of filing the document shall include a unique reference number (of the type RO/RO Fiscal Code Qn. 2015), which has to be mentioned in the payment order.
The payment shall be made in euro until the 20th of the month following the relevant quarter, to the bank account mentioned as well in the aforementioned note.
As regards the registration of such operations, the taxable person who is not established in the member state of consumption has to prepare a sufficiently detailed report regarding services for which such special status is applied, in order to allow the competent tax authorities of the member states of consumption to determine whether the VAT return mentioned above is correct. Such registrations are transmitted electronically, at the request of the competent tax authority, as well as of the member states of consumption. The non-resident taxable person shall keep such registrations for a term of 10 years from the end of the year in which services have been delivered.