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- Setting up a company in Romania
- Create a Romanian Joint-Stock company
- Types of Romanian Companies
- Establishing a Romanian representative office or company branch
- Registering a Romanian Micro-Company
- Buying a Romanian Company
- Permits & licenses for Romanian companies
- Incorporating a European Company
- The Trade Register
- Contract Law in Romania
- Romanian Administrators
- Liquidating a Company
- Law of International Contracts
- Property Tax in Romania
- The Romanian Land Registry
- Purchasing real estate
- Conditions for foreigners to buy Romanian properties
- New conveyancing VAT
- The Recuperation of Properties
- New Minimum Corporate Tax
- Deductibility Regulations
- Avoid double taxation (e.g. Romania - UK)
- Paying taxes for a Romanian Company
- Repatriate profits
- Anti-Crisis Measures
Double Taxation Avoidance Conventions signed with Romania
Romania has signed a large number of Treaties for the
avoidance of double taxation even before 1989. Partner-countries range from the
United Kingdom and Germany to Thailand, Ecuador, Kuweit etc.
The structure and some of the stipulations of these treaties are similar. To be
able to exemplify, we have analyzed Romania’s treaty signed with the United
Kingdom of Great Britain and Northern Ireland. This Treaty refers to the
following taxes: a) in Romania – income tax obtained from natural persons and
legal entities, profit tax for mixed companies (Romanian and foreign), income
tax obtained from agricultural activities and b) in the UK and Northern Ireland:
income tax, corporate tax, tax on capital gain. This list is not limitative.
Dividends obtained from a Romanian company by a person residing in the
United Kingdom can be taxed in the United Kingdom. Dividends can also be taxed
in Romania, but when they belong to a UK resident these shall not exceed:
a) 10% of the gross amount if the beneficiary is a company owning at least 25%
of the Romanian company’s shares;
b) 15% in all other cases.
• Certain exceptions do apply according to the Treaty of February 12th 1976
between Romania and the United Kingdom.
Interest gained in one of the countries can be taxed in the
other country, however if taxed in the country of origin per the legislation of
the respective State, it cannot exceed 10% of the gross amount.
• Certain exceptions do apply according to the Treaty of February 12th 1976
between Romania and the United Kingdom.
Dues gained in one of the countries can be taxed in the other country,
however if taxed in the country of origin per the legislation of the respective
State, it cannot exceed 15% of the gross amount. It is to be noted that dues
related to copyrights of literary, drama, artistic work and scientific work, the
tax established by the State where these dues originate from, shall not exceed
10% of the gross amount.
Commission-fees can also be taxed in the country of origin however in
this case 12,5% of the gross amount has to be taxed.
It is to be noted that gains obtained from the sale of real estate property
(this also includes the sale of related rights as per the stipulation of Art. 6
of the Convention) shall be taxed in the State where these properties are
located.
Conventions for the Avoidance of Double-Taxation usually also contains
stipulations on the taxation of capital gain, independent professions, pensions
etc. It is important to be noted for those investors originating from
member-states that the stipulations of these Conventions must also be
corroborated with EU regulations (applicable in Romania through the Fiscal
Code).
We have exceeded 100 incorporations of Romanian companies having foreign shareholder structures. We offer complete legal assistance for any type of Romanian company formation including Romanian SRL (LLC) or Joint-Stock (SA) registration, office address and general advice for matters related to taxation, Labor regulations as well as on-going assistance after the formation of the company.
