Finance News by Mazars Romania January 2024

Wed | 31.01.2024

Accounting/audit/tax

Mazars in Romania strengthens its leadership team

Mazars, the international tax, audit, and advisory firm, announces the appointment of three new leaders to its Romanian executive management team.

As of 1 January 2024, Mazars has appointed Cristina Constantin and Mariana Dragomir as Outsourcing – Accounting Partners, and Adrian Mihalcea as Deal Advisory Director, to further strengthen the firm’s capabilities and expertise in key areas of our business.

Cristina joined Mazars in 2013 and boasts an experience of more than 16 years of offering consultancy on financial accounting to clients from various industries, building continuously her expertise while working with large corporate clients from multinational groups with complex ERPs and reporting requirements. Cristina is an expert accountant, registered both as a member of the Romanian Chartered and Certified Accountants Body (CECCAR) and of the Romanian Chamber of Tax Consultants (CCF). In her new role, Cristina will continue to increase our visibility in all areas of accounting and reporting, while at the same time contributing to the growth of her client’s businesses.

Mariana has developed her competencies and expertise in professional advisory services related particularly to financial accounting, management accounting, and financial reporting. Having more than 17 years of experience in professional advisory services, she has delivered tailored accounting services to international clients and has specialised particularly in the implementation projects of various ERP systems. Mariana is a member of the Romanian Chartered and Certified Accountants Body (CECCAR) and of the Romanian Chamber of Tax Consultants (CCF). As she takes on this responsibility, Mariana will continue to lead our team toward continued success, ensuring a steadfast commitment to delivering high-quality services to our clients.

Adrian joined Mazars in 2016 and boasts an experience of more than 11 years in financial advisory services. His expertise is particularly focused on conducting M&A-related due diligence projects, encompassing both buy-side and sell-side engagements across a diverse range of industries. He is a Chartered Financial Analyst (CFA) charterholder and a member of The Association of Chartered Certified Accountants (ACCA). Leading a team of professionals, he instills a culture of innovation, adaptability, and client-centricity. In the future, he will continue to stay ahead of the curve and leverage his experience and insights to guide clients through the dynamic world of financial advisory services.

Read more info HERE.

The application of transfer pricing legislation in the Republic of Moldova enters final stages

The implementation of the transfer pricing concept in the Republic of Moldova represents a complex process of aligning local legislation to OECD and EU recommendations, but also a significant step towards the creation of a tax system in line with international values and standards.

For the time being, general provisions were introduced in the Tax Code regarding the arm's length principle, the definition of related parties, and minimum thresholds for transactions with related parties to be analysed.

Following the adoption of the Order currently under discussion, which will regulate the obligations of companies concerning the analysis and content of the transfer pricing file, taxpayers will be obliged to comply with the arm's length principle in transactions with related parties when determining taxable income.

Mazars’ tax experts wrote an article that will provide you with important information on the legislation that will implement the transfer pricing concept.

Read more info HERE.

The impact of the new minimum turnover tax from a transfer pricing perspective

Law 296/2023 mandates that taxpayers, who have reported an adjusted turnover exceeding €50 million in the previous year, are obligated to pay corporate income tax above a minimum threshold called the minimum turnover tax (MTR).

The tax rate applied on the adjusted turnover stands at 1% for commercial companies, and 2% for credit institutions from 2024 to 2025, and reverts to 1% starting in 2026. Additionally, companies involved in oil and gas activities are subject to a rate of 0.5%.

If the corporate income tax, calculated before deducting certain categories of tax credits, is less than the MTR, or if the taxpayer registers tax losses, it will pay tax at the level of MTR.

Impact on the Romanian companies

In Romania, there are approximately 1,000 active companies with a turnover of more than €50 million, which must analyse the effects of new legislation. Most of them are part of multinational and national groups.

The calculation of the profit and MTR for companies that are part of groups is influenced by transfer pricing rules, which require that transactions between affiliated companies be performed by observing the arm’s length principle.

Mazars’ tax experts have prepared an article with more information on the subject.

Read more info HERE.

OECD Pillar 2 GloBE: Preparing for a different tax future

The Pillar 2 Global Anti-Base Erosion (GloBE) rules have been developed by the Organisation for Economic Co-operation and Development (OECD) to provide a common system of taxation that ensures multinational enterprises (MNEs) pay a global minimum tax (GMT) of 15% in each jurisdiction where they operate and generate income.

The Pillar 2 GloBE initiative seeks to ensure that MNEs and large groups with consolidated accounting revenue globally of €750m in two of the four previous tax years pay a minimum tax of 15% in each jurisdiction they operate. More broadly, Pillar 2 GloBE will apply to those groups which already have to report under the country-by-country reporting (CbCR) rules and any entities in that group, with some exceptions.

Mazars’ tax experts are ready to support you on your Pillar 2 GloBE journey.

Read more info HERE.

Mazars CEE deal advisory highlights 2023

In 2023, Mazars has been ranked the 3rd leading deal advisor in Central & Eastern Europe, based on the Mergermarket CEE Accountant League Table by the number of successful deals, and among the top 5 players by disclosed M&A deal value in CEE.

Reflecting on the year, there are a few key themes that have directed and influenced Mazars’ transactional activity in CEE:

Strong cross-border dealmaking, with inbound investments coming mostly from Western Europe and the USA, but also from other parts of Europe (Middle-East for example);
Private equity buyouts are still very active;
Robust M&A activity in the following sectors: Energy & Renewables, Technology, Industrials, Healthcare & Pharmaceuticals, and Telecommunications;
Some M&A transactions involving CEE buyers develop outside our region, particularly in Western Europe.

Read more info HERE.

Latest tax alerts, by Mazars

Amendments and supplements to the Methodological Norms for the application of the Fiscal Code

Government Decision no. 1336/2023 amending and supplementing the Methodological Norms for the application of Law No. 227/2015 regarding the Fiscal Code has been published in the Official Gazette No.1196 on 29 December 2023.

Amendments brought to the register of purchases of housing subject to reduced VAT rate

Order No 2.080 of the NAFA President approving the Procedure regarding the organisation of the Register of purchases of housing subject to reduced VAT rate was published in the Official Gazette No 1190, on 29 December 2023.

EU Directive 2523/2022 on ensuring a global minimum level of taxation for multinational enterprises in the EU

Law no. 431/2023 on ensuring a global minimum level of taxation of multinational enterprise groups and large national groups was published in the Official Gazette no. 8 from 5 January 2024.

Read more info HERE.

This article is provided by our Finance Partner, MAZARS in Romania.

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