The Official Gazette No. 806 of August 29, 2025 published Government Ordinance No. 22/2025, introducing significant changes regarding the place of supply of services and the exemption scheme for small enterprises. These rules apply as of September 2025 and impact both the determination of the person liable to pay VAT and the turnover thresholds for VAT registration.
Key VAT amendments
- RO e-VAT System
The obligation of taxable persons to respond to compliance notifications issued by the tax authorities, as well as related sanctions, is suspended until December 31, 2025. This applies also to entities using the cash accounting VAT system. - Place of supply of services
- For services to non-taxable persons:
- the place where the activities are physically carried out (for cultural, artistic, sporting, scientific, educational, entertainment events etc.);
- the place where the customer is established or resides, for online or virtually supplied services.
- For services to taxable persons:
- the place where the events actually take place, for admission to events (excluding virtual attendance).
- For services to non-taxable persons:
- Exemption threshold for small enterprises
As of September 1, 2025, the threshold increases from RON 300,000 to RON 395,000. Businesses below this limit may continue applying the special exemption scheme. - Rules for exceeding the threshold
VAT registration must be requested no later than the date the threshold is exceeded, and normal VAT taxation applies starting from that transaction. Specific procedures apply in cases of late registration. - Transitional provisions
Companies exceeding the RON 300,000 threshold in August 2025, but not the RON 395,000 threshold, are not required to register until the new limit is exceeded. If the RON 395,000 threshold was also exceeded in August, registration must be requested by September 10, 2025. - EU-wide rules
- Taxable persons established in Romania may apply the small business exemption scheme in other EU Member States if their annual EU-wide turnover does not exceed EUR 100,000 and local thresholds are respected.
- Businesses established in other Member States may apply the scheme in Romania under the same conditions (EUR 100,000 EU-wide turnover and compliance with the Romanian VAT exemption threshold).