New Double Tax Treaty between Romania and Bulgaria

  • Some terms used in the previous agreement have been clarified (e.g. enterprise, company).
  • Two new criteria have been introduced in regards to the definition of residents – i.e. the place of registration / place of incorporation is considered a country of residency.
  • New anti-abuse clauses have been introduced.
  • Article 5 – a building site, a construction, assembly or installation project constitutes a permanent establishment only if it lasts more than 12 months (compared to 9 months under the previous agreement).
  • Article 10 – introduces the term beneficial owner and the tax rate has been reduced to 5% (in the previous agreement the tax rate was 10% or 15% depending on certain conditions).
  • Article 11 – tax rate has been reduced to 5% (compared to 15% under the previous agreement).
  • Article 12 – tax rate has been reduced to 5% (compared to 15% under the previous agreement) and the term know-how has been introduced under the definition of royalties.
  • The article regarding Capital has been eliminated (i.e. Article .23).
  • Clarifications have been introduced regarding the elimination of double taxation and tax credits (Article 22).
  • A new article has been introduced, i.e. Article 26 – assistance for the collection of taxes, where Contracting States shall assist each other in collecting revenue claims.

Dan Bădin

Camelia Malahov

Adrian Stoian

Related posts