Last updated: 31 January 2017
The changes in tax legislation, in force in 2017, include new provisions regarding the exemption from the payment of the income tax for certain professional categories. We present to you below the new provisions regarding this exemption for software developers and for persons hired under a fixed-term employment contract.
EXEMPTION FROM THE INCOME TAX FOR SOFTWARE DEVELOPERS
The incentive provided by the Tax Code for software developers, namely the exemption from the income tax (16%), introduced in recent years, is maintained in 2017. However, the conditions to be complied with in order to benefit from such exemption have been slightly modified.
These changes are provided by Order no. 872/ 5932/2284/2903/2016, published in the Official Journal on the 9th of January 2017, which will enter in force on the 1st of February 2017. The said Order provides that employers must have obtained, in the previous financial year, income from software development activities and that such income has to be registered separately in the employers’ analytical balance sheets.
However, this condition is not applicable to companies created during the year in question or to companies that, during the previous year, underwent a reorganization procedure in accordance with the law.
Moreover, the minimum income of 10,000 Euros per employee, previously required by the law, was eliminated.
The Order also refers to the documents to be included in the file that the employee is required keep and present to the tax authority, if needed. From now on, the copies of the individual employment contract, diplomas and academic transcript/diploma supplement need not be notarized. A certified copy thereof will suffice.
We remind you that the university graduates who occupy positions such as database administrator, analyst, computer systems engineer, software systems engineer, IT project manager, software developer, computer systems designer and computer systems developer can be exempt from the income tax in certain conditions.
NEW EXEMPTION FROM THE INCOME TAX
Government Emergency Ordinance no. 3/2017, amending the Tax Code, provides a new exemption from the income tax. Starting from the 1st of February, this exemption will be granted to natural persons hired under a fixed term employment contract of 12 months by Romanian legal persons doing business in the following sectors:
- Hotels and other similar accommodation facilities ;
- Holiday and short period accommodation;
- Caravan, camper parks;
- Other accommodation services;
- Restaurants;
- Event catering;
- Other food services;
- Bars and other public houses.