Bucharest Tower Center, etaj 22 B-dul Ion Mihalache
nr. 15-17 011171 Bucuresti, sector 1, Romania
+40 21 402 4000

Law no. 155/2020 amending and completing the Electricity and Natural Gas Law no. 123/2012

In this issue:

Law no. 155/2020 amending and completing the Electricity and Natural Gas Law no. 123/2012 and other normative acts, including the Fiscal Code

 

The tax regime of the individual prosumers’ activity*

The Law no. 155/2020 amends and completes, among others, the Fiscal Code, by introducing specific provisions from the perspective of income tax, social security charges and value added tax regarding the prosumers, natural persons* who do not operate under any form of organization*.

According to the Law no. 155/2020, for the revenues obtained by the prosumers, natural persons, from the sale of electricity to the electricity suppliers with which they have concluded supply contracts, these:

  • are exempt from paying income tax;
  • are not required to file the Single Declaration on income tax and social securities charges due by individuals;
  • do not owe the social security contribution (the exemption is applicable for the pension contribution and not to the social health contribution);
  • are exempt from the obligation to issue an invoice for these supplies of electricity;
  • are not required to keep records for these supplies of electricity.
 

The Law 155/2020 seeks to correlate the Fiscal Code with the provisions of the specific regulatory framework, which provides a general exemption for prosumers natural persons from the payment of all tax obligations related to the amount of electricity produced for self-consumption, as well as the surplus sold to suppliers.

The specific legislation also provides a financial regularization mechanism which, for all prosumers natural persons, involves a quantitative compensation in the invoices issued by electricity suppliers (between the quantity delivered by the supplier to the prosumer natural person and the quantity delivered by the prosumer to the supplier) and invoicing of the net amounts by the suppliers.

Correlating the tax provisions with those of the specific regulatory framework on energy creates the context to update the analysis of the tax implications arising from the regulatory framework applicable to these specific schemes, such as:

  • recognition and presentation of income and expenses elements;
  • invoicing method, the financial regularization mechanism and the tax implications (VAT, profit tax) applicable to the compensation of the energy delivered by the supplier to the prosumer natural person with the energy delivered by the prosumer to the supplier;
  • the tax regime of the sale of the surplus electricity performed by prosumers natural persons operating under a form of organization (as per Government Emergency Ordinance no. 44/2008 on conducting economic activities by authorized individuals, individual enterprises and family enterprises).
 

We invite you to contact with confidence our consultants in order to obtain more information on the provisions of this draft normative act, as well as its impact for you.

 

* These provisions are applicable to prosumers natural persons, other than those organized according to Government Emergency Ordinance no. 44/2008 on conducting economic activities by authorized individuals, individual enterprises and family enterprises that have concluded contracts for the supply of electricity, if the power plants producing electricity from renewable sources that they own have the installed power of at most 27 kW per place of consumption.

 
Prepared by:
Georgiana Iancu, Partner – Indirect Tax
Florin Parîng – Senior Manager, Indirect Tax
 
For additional information, please contact:
Alex Milcev – Partner, Tax & Law Leader Romania
Georgiana Iancu, Partner – Indirect Tax
 
Ernst & Young SRL
Bucharest Tower Center Building,
22nd Floor, 15-17 Ion Mihalache Blvd.,
Sector 1, 011171, Bucharest, Romania
Tel: (40-21) 402 4000, Fax: (40-21) 310 7124
Email: office@ro.ey.com
Abonează-te la noutățile EY România și fii la curent cu ultimele studii și articole, evenimente și comunicate de presă lansate de experții noștri.
Abonează-te