Law 322/2021 for completing Law no. 227/2015 on the Fiscal Code was published in the Official Gazette (Part I) no. 1245 of December 30, 2021, with applicability of January 1, 2022.
The normative act punctually modifies the Fiscal Code, regarding the procedure for reducing the payment of the profit tax, respectively with the reduction for the payment of the income tax of the micro-enterprise, when the taxpayers carry out sponsorships or grant amounts through patronage contracts.
We specify that the Law brings measures applicable on January 1, 2022, but it also has transitional measures applicable to those sponsorships in progress on December 31, 2021 or to those sponsorships postponed 7 years for corporate tax payers or 28 quarters for tax payers on the income of the micro-enterprise.
Tax treatment of sponsorships applicable before January 1, 2022:
- In the case of corporate tax payers, the sponsorship expense is completely non-deductible when calculating the corporate tax, but reduces the corporate tax due to the payment with the lowest value of 7.5 per thousand of the annual turnover, without exceeding 20 % of profit tax due. If the sponsorship exceeds the aforementioned value, the amount in excess is carried forward for 7 years, decreasing the profit tax due to each profit tax calculation, respecting the same rules for reducing the profit tax.
- For micro-enterprise income taxpayers, sponsorships reduce the micro-enterprise income tax by up to 20% of the income tax due in the quarter in which the sponsorship expenses were recorded. If the value of the sponsorships exceeds the aforementioned value, the excess amount is carried forward to the next maximum 28 consecutive quarters and decreases the income tax of the micro-enterprise at each tax payment period, respecting the same condition not to exceed 20% of the tax due .
Tax treatment of sponsorships applicable after January 1, 2022:
- Tax treatment – profit tax payers:
If the amount established in accordance with Article 25 (4) letter (i), less the amounts carried forward, as the case may be, has not been used in full, taxpayers may order the redirection of income tax, up to the amount so calculated, for sponsorships and / or acts of patronage or granting private scholarships, within a maximum of 6 months from the date of submission of the annual income tax return, by submitting a form (s) of redirection.
In the case of taxpayers members of a tax group, the redirection can be ordered only by the responsible legal person.
We mention that the obligation to pay the amount redirected from the profit tax belongs to the competent fiscal authority
The redirection of the profit tax for the sponsorship of non-profit legal entities, including cult units, can be performed only if the beneficiary of the sponsorship is registered, at the date of payment of the respective amount by the fiscal authority, in the Register of cult entities / units for which it is granted, acc. tax deductions in accordance with Article 25 (41).
- Tax treatment – payers of income tax on micro-enterprises:
If the amount established in accordance with Article 56 (11), less the amounts carried forward, as the case may be, has not been used in full, taxpayers may order the redirection of the income tax of micro-enterprises, within the limit thus calculated for the entire fiscal year for the granting of scholarships, respectively for the granting of scholarships, within 6 months from the date of submission of the tax declaration related to the fourth quarter, by submitting a / some redirection form / forms.
The obligation to pay the redirected amount from the income tax of the micro-enterprises belongs to the competent fiscal authority
The redirection of the income tax of micro-enterprises for the sponsorship of non-profit legal entities, including cult units, can be performed only if the beneficiary of the sponsorship is registered, at the date of payment of the respective amount by the fiscal authority, in the Register of cult entities / units. grant tax deductions in accordance with Article 25 (41).
For both categories of taxpayers, the procedure, model and content of the redirection form are established by order of the President of the A.N.A.F.
- Special provisions:
According to Law no. 322/2021, starting with January 1, 2022, respectively with the start date of the fiscal year 2022-2023 in the case of legal entities that have opted for a financial year other than the calendar year, according to the provisions of article 16 paragraph (5) of Law no. 227/2015 on the Fiscal Code, with subsequent amendments and completions, the taxpayers may dispose of the value established according to the provisions of article 25 paragraph (4) letter i) or article 56 paragraph (11) of Law no. 227/2015, with the subsequent amendments and completions, as the case may be, only if this, following the decrease with the amounts carried forward, is positive.
The amounts that are not deducted from the profit tax, respectively from the income tax of micro-enterprises are carried forward only for sponsorships / patronage acts / granting of private scholarships made / registered before the terms provided in the previous paragraph, according to the regulations in force at the time of sponsorship. without exceeding 2028.
Legal basis:
– Fiscal Code (approved by Law no. 227/2015, published in the Official Gazette no. 688 of 10.09.2015), with subsequent amendments and completions;
– Law 322/2021 for the completion of Law no. 227/2015 on the Fiscal Code.