Tax return verification services – determination of reductions in tax calculation and avoidance of assimilated risks

Considering the reductions in determining the tax on income/profit depending on the maintenance or the increase of the equity, regulated by GEO 153/2020, Especial Audit SRL proposes revision services of the tax Declaration 101 on tax on profit, for income tax payers or of the Declaration 100 on the obligation of payment to the state budget for the micro-enterprises and for the specific tax payers that have the submission deadline on June 25, 2022 inclusive.

We consider such a verification useful both for a correct determination of the applicable reductions and for avoiding the risks of further adjustments that would affect the fulfillment of the conditions for the application of the various discount percentages.

Briefly, the reductions applicable to the determination of the tax are the following:

a) 2%, if the accounting equity in the year for which it is owed tax is positive and at least equal to half of the subscribed share capital;

b) if it is registered an annual increase of the adjusted equity of the year for which it is owed the tax towards the adjusted equity registered in the previous year and at the same time fulfills the condition provided in let. a), the discounts have the following values:

Tax reduction percentage     Adjusted annual equity growth intervals
5%                               up to 5% inclusive
6%                               over 5% and up to 10% inclusive
7%                               over 10% and up to 15% inclusive
8%                               over 15% and up to 20% inclusive
9%                               over 20% and up to 25% inclusive
10%                              over 25%

c) 3%, if it is registered an increase over the next level:

The year for which it owes the tax   Minimum adjusted equity increase percentage
2022                                          5%
2023                                          10%
2024                                          15%
2025                                          20%

of the adjusted equity of the year for which it is owed the tax on the adjusted equity registered in 2020 and if it simultaneously meets the condition from letter a; the provisions of this letter apply starting with the year 2022, respectively starting with the modified fiscal year starting in the year 2022.

If two or three of the above reductions are applicable, in order to determine the amount of the reduction, the corresponding percentages shall be added together and the resulting value shall be applied to the tax.