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Cases in Which Taxpayers May Be Declared Inactive by Tax Authorities

Following the amendment of Law No. 207/2015, regarding the Code of Civil Procedure, with effect from 1 January 2016, any taxpayer, either a natural or a legal entity, or an entity without legal personality, shall be declared inactive, being subject to the provisions of the Tax Code relating to the effects of inactivity, if such taxpayer faces any of the situations specified below:
a) fails to declare his/her/its payment obligations, as provided by law, throughout half a calendar year;
b)  evades   tax   inspections   by   declaring   tax domicile   data   making   the   tax   authority unable to identify it;
c) is identified by the tax authority to perform no activity at the declared tax domicile;
d) his/her/its temporary inactivity is registered in the Trade Register;
e) company’s duration has expired;
f) the company no longer has statutory bodies;
g) the duration provided for the use of a space as registered place of business has expired.

Practically speaking, the most frequent cases that may lead to declaring a company inactive are (i) the expiry of corporate  administrators’ mandate and (ii) the expiration of the duration set for the use of the space as company’s registered office.

Regarding the cases mentioned at (d)-to-(g) above, the National Trade Register Office shall provide the National Tax Administration Agency (“ANAF”) with information, on the basis of a special procedure, about the taxpayer that faces any of such situations with a view to enabling ANAF to initiate the procedure for declaring said taxpayer inactive.

In order to avoid the initiation of this procedure by the tax authority, we hereby recommend that you should verify whether you find yourself in any of the situations specified hereinabove (e.g. even if you concluded an additional act on the extension of the duration of the use of the space as registered office, you should be sure that it is registered with the Trade Register Office) or whether such situation is impending.

LEGAL ALERT by Duncea, Stefanescu & Associates

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Member of MARCALLIANCE: www.marcalliance.com

Legal Alert contains a selection of the latest major issues occurred in the Romanian legislative framework, is intended only to provide information and, hence, shall not be deemed to provide professional advice or consultancy. Therefore, Duncea, Stefanescu & Associates assumes no responsibility in this respect. Should you require any information to the foregoing, please do not hesitate to contact us.

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