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Romania

10 February 2016

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Romania Publishes Order on Transfer Pricing Documentation Preparation and Submission Requirements

On 2 February 2016, Romania published Order No. 442/2016 in the Official Gazette concerning transfer pricing documentation preparation and submission requirements.

Transaction Thresholds

Under the order, large taxpayers should prepare transfer pricing documentation annually if annual aggregate transactions with related parties meet the following thresholds, excluding VAT:

  • EUR 200,000 for interest received or paid for financial services;
  • EUR 250,000 for services received or provided; and
  • EUR 350,000 for acquisition or sale of tangible or intangible assets.

For large taxpayers not meeting the above thresholds and SMEs, transfer pricing documentation should be prepared upon request by the tax authorities if annual aggregate transactions with related parties meet the following thresholds, excluding VAT:

  • EUR 50,000 for interest received or paid for financial services;
  • EUR 50,000 for services received or provided; and
  • EUR 100,000 for acquisition or sale of tangible or intangible assets.

To determine if the thresholds are met for non-EUR transactions, the exchange rate is the exchange rate of the National Bank of Romania on the last day of the fiscal year concerned.

Documentation Preparation and Submission Requirements

The order includes amendments and additions to the documentation requirements based on the new OECD Transfer Pricing Guidelines developed under Action 13 of the OECD BEPS project, as well as the EU Code of Conduct for transfer pricing documentation. This includes the Master/Local file concept for group-level documentation and taxpayer-specific documentation.

For large taxpayers with transactions meeting the higher thresholds, the transfer pricing documentation should be prepared by the annual tax return deadline. If requested by the tax authorities, the documentation should be should be submitted within 10 days of request, but no sooner than 10 days after the deadline for preparation.

For large taxpayers and SMEs with transactions meeting the lower thresholds, transfer pricing documentation is to be prepared upon request by the tax authorities. The documentation submission deadline is set by the tax authorities, and may be within 30 to 60 days of the request, with the possibility for a 30-day extension.

If a taxpayer fails to submit documentation by the applicable deadline or the documentation is incomplete, the tax authorities will proceed to make an estimation of the appropriate transfer price and make any necessary adjustments.

Note - Documentation is not required for transactions covered by an advanced pricing agreement.

Effective Date

Order No. 442/2016 applies for related party transactions carried out from 1 January 2016.

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