In the Official Gazette (Part 1) no.1190 of 12 December 2022, ANAF Order no.2420 was published for the approval of the Procedure for the ex officio determination of the tax obligations owed by individuals for some allowances representing social protection measures and for some income obtained abroad, as well as for the approval of the model and content of some forms.
We mention that the normative act is in force from the date of publication, i.e. from 12 December 2022.
The recently published document is addressed to individuals who have not fulfilled their obligations to declare and pay compulsory social insurance.
The new ex officio tax assessment procedure for foreign income applies from 2021.
We recall that during the state of emergency and subsequently during the state of alert various socio-professional categories, such as self-employed persons, persons who earned income from royalties received from the budget various forms of support in the form of either technical unemployment or allowances for reduced working hours, etc.
Specifically, according to Articles 139^1 and 157^2 of the Tax Code, this refers to remuneration, allowances, other similar income, as well as any other benefits, in cash and/or in kind, obtained from abroad as members of the board of directors, members of the management board, members of the supervisory board, administrators, directors, auditors, founding members, representatives in the general meeting of shareholders or any other activities performed in similar positions for work performed abroad for foreign employers. Employers who have neither permanent headquarters nor tax residence in Romania are concerned.
Secondly, those who obtain pensions from abroad in excess of 4,000 lei must submit a single declaration and pay CASS for the part exceeding that amount. In this case, however, the declaration and payment obligations start with the income from 2022, so they must be fulfilled first by 25 May 2023.
Thus, if the above-mentioned persons do not submit the single declaration and do not pay their social contributions by the annual deadline of 25 May, ANAF may issue tax decisions ex officio based on the information it holds and oblige them to pay CAS and/or CASS. ANAF basically exchanges information with other tax authorities abroad in order to identify people who are ignoring their obligations, but also uses information from previously submitted single tax returns or information from other sources.
Therefore, ANAF Order 2420/2022 is addressed to persons who have not fulfilled these obligations to declare and pay social security and modifies the procedure for ex officio determination by the tax authority and, subsequently, if necessary, for enforcement.
The main steps of the procedure are:
- calculating income tax and compulsory social security contributions separately from the obligations related to the income earned by the individual from carrying out the activity;
- identification of taxpayers on the basis of the information provided by the National Agency for Payments and Social Inspection and drawing up the list of taxpayers who have earned income from benefits for which tax obligations are due; from the list are removed taxpayers who have filed a single return, individuals who do not owe social insurance contributions in Romania in the tax year and persons insured in their own social insurance systems not integrated into the public pension system;
- subsequently, the specialized department notifies each taxpayer included in the list and ensures the exercise of the right to be heard according to the provisions of Article 9 of the Tax Procedure Code, specifying the deadline by which the natural person must appear for the hearing;
- within 15 days from the date of the notification, the competent central tax authority shall remove from the list the taxpayers who, following the notification, have fulfilled their obligations to declare their social security contributions by submitting a single declaration on income tax and social contributions owed by individuals to the competent central tax authority ;
- in the case of individuals who obtain income assimilated to salaries for the activity carried out abroad, their identification for which the social security contribution is established ex officio is made on the basis of the exchange of information between ANAF and the tax authorities abroad, through the national computer application “Automatic Exchange of Information” (AEOI) and a list is drawn up; from the list are removed the taxpayers who have submitted the single declaration on and have declared the social security contribution due for income assimilated to salaries for the activity carried out abroad in the corresponding section of Chapter I, individuals who do not owe social security contributions in Romania in the tax year; and in the case of these persons, the steps described above regarding the notification and hearing of taxpayers are followed;
- in the case of the ex officio determination of the tax obligations owed by individuals who obtain income assimilated to salaries for the activity carried out abroad and pension income from abroad, a list is drawn up based on the information submitted, the taxpayers who have submitted the single declaration, the individuals who do not owe social insurance contributions in Romania, the individuals who do not have the status of taxpayer to the social health insurance system in the tax year are removed from the list and the same procedure for notifying and hearing the taxpayers is followed.
The decision on the ex officio determination of the tax obligations owed by individuals for certain allowances representing measures in the field of social protection and for certain income obtained abroad is issued in two copies, one of which is communicated to the individual.
If, within 60 days from the date of the communication of the decision on the ex officio determination of the tax obligations owed by individuals for certain allowances representing measures in the field of social protection and for certain income obtained from abroad, the taxpayer fulfils the declaratory obligations, the decision shall be cancelled.
In this case, the competent central tax authority issues Form 662 “Decision on the cancellation of the Decision on the ex officio determination of the tax obligations owed by natural persons for certain allowances representing measures in the field of social protection and for certain income obtained abroad”.
This form is also issued in case the taxpayer proves, after the communication of the ex officio tax assessment decision, by submitting documents, that he was not obliged to pay the tax obligations in the tax year.
Legal basis:
ANAF Order no.2420/2022 for the approval of the Procedure for the ex officio determination of the tax obligations owed by individuals for some allowances representing social protection measures and for some income obtained abroad, as well as for the approval of the model and content of some forms.