LEASE CONTRACTS: NEW REGISTRATION PROCEDURE A new registration procedure of private lease contracts with the tax authorities entered into force a few days ago, after the Order no. 114/2019 of the National Agency for Fiscal Administration concerning the lease contracts registration procedure was published in the Official Journal no. 109/2019 together with the template and the content of “The lease contract registration application”.

The NAFA’s order establishes that lease contracts registration via electronic means is possible as well. Another change brought about by the Order is the unique registration procedure applicable for both natural persons and legal entities.

ACCOUNT FOR THE SETTLEMENT

The lawmaker introduced the new registration procedure of lease contracts with tax authorities in order to recognize the enforceability of lease contracts, as under the Romanian Civil Code, the payment of the lease due under private lease contracts registered with tax authorities has an enforceable character.

Before the Tax Code was amended in 2018 by the Emergency Ordinance no. 18/2018, when the “Unique Declaration was introduced, the taxpayers obtaining rental income would have to submit a statement about the estimated income, within 30 days from the conclusion of the lease contract. Furthermore, the lease contract was to be registered with the tax authorities within the same period. The Emergency Ordinance no. 18/2018 precluded the obligation of registration of the lease contract with tax authorities, as well as the Unique Declaration.

According to the new NAFA order no. 114/2019, taxpayers can register their lease contracts with tax authorities in order to make the payment of the lease enforceable. In case the lessee does not pay the lease as established under the contract, the lessor who registered the lease contract can obtain the direct compulsory execution of the lessee’s obligations.

THE NEW REGISTRATION PROCEDURE

The new lease contracts registration procedure is a unique procedure and the distinction between the status of the lessor – natural person or legal entity – is no longer made.

In fact, if the former regulation supposed a different procedure for the registration of lease contracts according to whether the lessor was a natural person or a legal entity, the new regulation requires a single procedure, irrespective of the status of the lessor.

The NAFA’s order also allows stipulates the possibility to register lease contracts by electronic means.

Furthermore, the new procedure also simplifies the registration formalities for changes or termination of the lease contract: there is only one form to be filled and submitted. The taxpayer needs to check the applicable option on the form, either “Change” or “Termination, as it may be the case, and submit the form together with supporting documents.
The submission date of the file with the competent tax authority or the registration date on the portal is considered to be registration date of the lease agreement, of any change or termination of the lease contract.

It is to be noted that the competent tax body for the registration of lease contracts is the tax office to which the address/ registered office of the resident lessor is assigned, in the case of non-resident lessors, the one to which the asset is assigned to.