Situation: An ABC SRL company that was established in May 2022. In September 2022, it becomes a VAT payer by option (fiscal period: quarterly). How is the 100,000 euro turnover limit calculated at the end of the year in order to see if VAT remains payable per quarter or month?
Solution: According to article 322 paragraph (2) and paragraph 103 paragraph (2) of the NM, the equivalent in lei of the 100,000 euro limit provided for in article 322 paragraph (2) of the Tax Code, in any case, is determined on the basis of the exchange rate communicated by the National Bank of Romania valid for 31 December of the previous year, including for taxable persons applying for VAT registration, according to article 316 of the Tax Code, during the year.
Please note that for the year 2022, the calculation of the equivalent in lei of the limit of 100,000 euro is made on the basis of the exchange rate B.N.R. of 4.9474 lei/euro, in force on 31.12.2022.
Thus, for the entire year 2022, the limit for establishing the fiscal reporting period in 2023 is 494,740 lei (100,000 euro x 4.9474 lei 494,740 lei), as the equivalent in lei of the amount of 100,000 euro.
Taking into account that the company has been registered for VAT purposes since September 2022, the 100,000 euro limit is directly proportional to the number of months in which the company has been a VAT payer, according to the provisions of Article 322 paragraph (5) of the Tax Code:
If the turnover actually obtained in the year of registration, recalculated on the basis of the activity corresponding to a full calendar year, exceeds the limit provided for in paragraph (2), in the following year the tax period will be the calendar month, according to paragraph (1). If this actual turnover does not exceed the limit provided for in paragraph 2, the taxable person shall use the calendar quarter as the tax period, except where the taxable person has made one or more intra-Community acquisitions of goods during the previous calendar year.
Recalculation of the €100,000 limit :
100.000 euro : 12 months = 8.333,33 euro/month
8.333,33 euro/month x 4 months (September – December 2022) = 33.333,33 euro
33.333,33 euro x 4,9474 lei/euro = 164.913,32 lei
Therefore, the recalculation of the limit of 100,000 euros is made only for the period in 2022 in which the company is a VAT payer, under the normal regime, i.e. for the period September-December 2022, taking into account the provisions of paragraph 103 paragraph 3) of the NM, which stipulate that in the case of taxable persons who have applied the exemption regime provided for in Article 310 of the Tax Code and who are registered for VAT purposes under Article 316 of the Tax Code, . ………., the supplies of goods/services referred to in paragraph (2) made during the period in which the taxable person did not have a VAT registration code, according to Article 316 of the Tax Code, shall not be taken into account in the calculation of turnover.
In conclusion, if the income realized in the period September 2022-December 2022 exceeds the recalculated limit (164.913,32 lei), then starting from 2023, the tax period will be the calendar month.
Thus, the tax period for VAT is changed annually if the 100,000 euro threshold is exceeded and not during the year.
Therefore the changeover to the tax period calendar month is made with the year 01.01.2023, as the VAT is analysed during the previous calendar year (2022).
To change the tax period for the year 2023 from calendar quarter to month, form code 700 “Declaration for the electronic registration/modification of the categories of declaratory tax obligations entered in the tax vector” must be submitted by 16 January 2023 inclusive (15 January falls on a Sunday), according to the provisions of Article 88 paragraph (1) of the Tax Procedure Code, which stipulates that subsequent changes to the data in the tax registration declaration must be notified to the central tax authority within 15 days from the date of their occurrence, by completing and submitting the statement of information.
Legal basis:
- Fiscal Code (approved by Law no. 227/2015, published in MO no. 688 of 10.09.2015), with subsequent amendments and additions;
- Methodological norms for the application of the Fiscal Code (approved by HG no. 1/2016);
- anaf.ro