Microenterprises were an important alternative for small business owners, with their fiscal regime providing a key benefit to the positive evolution of any small investment.
Representing a separate type of limited liability company, the microenterprise had a particular tax status, offering the option of paying a 3% income tax instead of a 16% profit. This system especially benefited firms with high incomes but with low costs.
Along with the option to choose between the two types of taxes, the micro-enterprise status also involves a number of univocal conditions.
One of the key provisions defining the microenterprise creation process was linked to the revenue ceiling. It did not have to exceed in Romanian the equivalent of 1,000,000 euros. Also, these revenues were to come from sources other than banking, capital, insurance, gambling, consulting or management.
The number of employees was limited between one and nine; it was not allowed for the state or other local authorities to hold share capital and no legal entity with more than 250 employees.
The beginning of 2017 brings about a series of changes in the procedures for setting up micro-enterprises, introducing new provisions on the way of taxation and the level of the income ceiling. The Draft Ordinance for amending and completing the Law on the Fiscal Code stipulates that the new income ceiling should not exceed the equivalent in ROL of EUR 1,000,000. This provision also introduces the obligation to pay the income tax on the condition that, on 31 December of the previous fiscal year, the entities in question have cumulatively fulfilled the conditions mentioned in the statutes of the micro-enterprises.
Also, there is no requirement to have a number of employees between one and nine.
All companies that have earned tax on profits in 2017 and who have earned less than EUR 1,000,000 in the financial year 2017 will become taxpayers on microfinance income as of 1 January 2018.
The shift from corporate tax to micro-business involves the submission of the statement of claims (statement 010 or statement 700). Statement 010 (or 700) for the transition to a microenterprise shall be submitted by 31 March 2018.
Changes in this order may sometimes be disturbing when it comes to choosing a profitable alternative in the current business environment. Thorough knowledge of the latest provisions and the approximate anticipation of possible legislative difficulties is one of the essential conditions that determine the choice of an optimal investment channel.
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