Last reviewed 21 Aug 2023
For accounting and tax purposes: buildings are subject to straight-line depreciation over expected useful life of the asset within the below-mentioned spread of years.
N/A
No depreciation
Established according to the Government Decision no. 2139/2004, different depreciation categories depending on the destination of the building; industrial buildings, office buildings, hotels - 40 - 60 years; warehouses - 32 - 48 years; lightweight constructions - 16 - 24 years;
Generally the acquisition costs of the building. In case of subsequent investment for improving the initial technical parameters, the investment is recovered through depreciation over the remaining useful life. If the investments are performed on fully depreciated buildings, the fiscal depreciation is determined based on a new useful life computed by a technical expert.
In case of mixed business and private use, depreciation is calculated on the proportionate share of acquisition or construction costs.
For mines, quarries and oil fields, depreciation is based on the amount recoverable which is revaluated every 5 years.
For salt mines: depreciation is based on the amount recoverable, which is revaluated every 10 years. Land improvements are depreciated over a period of 10 years.
Not permitted
Immovable property transfers performed by legal entities are subject to income or corporate income tax.
Revenues obtained by individuals from the sale of real estate properties are subject to income tax on the value of the real estate.
For companies: 16% corporate income tax applicable on the taxable gains realized from the transaction (difference between the selling price and the fiscal value - e.g. the acquisition price) or 1% microenterprise tax applicable on the income.
For individuals: 3% income tax on the sale value if the real estate was owned for a period under 3 years and 1% income tax on the sale value otherwise.
For companies: self-assessment.
For individuals: by the notary public, upon authenticating the sale-purchase agreement.
The following immovable property transfers are exempted from income taxation:(i) donations between close relatives and between husband and wife; (ii) restitution of property rights according to special laws; (iii) inheritances, if the testamentary provisions are executed or the legal succession is debated within 2 years. Otherwise, a 1% income tax is due on the value of the inheritance.
Sale or other type of transfers of real estate is subject to notary fees and Real Estate book fees.
The notary fees are generally based on the sale price of the real estate. In cases where the sale price is lower than the value of the public notary expertise, the expertise price would be used for determining the property taxes.
Fees for registration in the real estate book are determined on the value of the transfer.
Generally 0.5% (but may vary depending on certain circumstances).
Fees for registration in the real estate book are generally computed considering the following rates:
■ in case of transfers to companies: 0.5% of the value of the property
■ in case of transfers to individuals: 0.15% of the value of the property.
The land tax is computed on the basis of area (square metres), location and category of use (local authority classification).
The building tax is differentiated depending on the buildings destination, as follows:
■ residential buildings – the tax rate is between 0.08% – 0.2% of the taxable value of the building. The taxable value is determined for individuals based on the built area multiplied with the taxable value per sqm provided by law
■ non-residential buildings – the tax rate is between 0.2% – 1.3% applicable to the taxable base.
For individuals, the taxable base for non-residential buildings may be:
a) the amount resulting from an evaluation report prepared by an authorized valuator in the past 5 years;
b) the value of the construction works for buildings constructed in the past 5 years;
c) the purchase value for buildings acquired in the past 5 years.
In case the taxable value of the building cannot be determined according to the above rules, the tax is calculated by applying the rate of 2% on the taxable value determined as for residential buildings.
For legal entities, the taxable base is the value as at 31 December of the year preceding the year for which the tax is due and can be:
a) the last taxable value recorded with the local tax authorities;
b) the amount resulting from an evaluation report prepared by an authorized valuator;
c) the final value of the construction works – for new buildings (constructed during the previous fiscal year);
d) the purchase value for buildings purchased during the previous fiscal year;
e) in case of buildings that are funded under a finance lease, the amount resulting from an evaluation report drawn up by an authorized valuator;
f) in the case of buildings publicly or privately owned by the state / the administrative-territorial units that are leased to a legal entity, the value registered by the owner in its accounting records.
Legal entities should update the taxable value of the buildings every 5 years based on an evaluation report, otherwise an increased tax rate of 5% is applicable.
For non-residential buildings used for agricultural purposes the tax rate is of 0.4%.
In certain circumstances, the local public authorities may establish land and building taxes increased with up to 50% considering criteria such as e.g. economical, social and geographical factors, local budget necessities etc.
Starting 1 January 2024, a special tax will be applied to immovable / movable assets of high value, as follows:
■3% – for individuals who on 31 December of the previous year owned residential buildings located in Romania whose taxable value exceeded RON 2.5 million. The tax will be levied on the difference between the taxable value of the building, communicated by the local fiscal body, and the above-mentioned threshold, and is to be paid by 30 September of the current fiscal year. The local tax authority will notify on an annual basis individual taxpayers who own residential buildings with a taxable value in excess of RON 2.5 million.
■ 3% – for individuals and legal persons who own cars registered in Romania whose individual purchase price exceeds RON 375 thousand. The tax is levied on the difference between the purchase value and the corresponding threshold and is to be paid by 31 December of the current fiscal year. This tax is due for 5 years, starting with the fiscal year in which the car was received (or for the remaining number of years until expiry of the 5-year period, if the car was purchased before 2024).
Real estate funds may be set-up as entities with or without legal personality. Similar to commercial companies, real estate funds set up as legal entities may be owned by both individuals or other legal entities (Romanian or non-resident). The investment funds are regulated and monitored by the National Securities Committee and the Financial Supervisory Authority.
In certain cases, the Financial Supervisory Authority can request that the assets evaluation and the financial statements’ audit of the companies in which the real estate funds invest be carried out more frequently than on an annual basis.
No specific requirements regarding borrowing, however the real estate funds may provide loans only up to certain limits.
Limitations (as % of the assets value, varying depending on the real estate fund type) apply for assets allocated to one single real estate investment. Investments, other than real estate, can be made up to a percentage of the fund's assets.
No specific rules apply. Real estate funds' administrators need to compute, withhold, declare and pay the tax due by individual investors with respect to their investments, as well as to provide the information related to the taxable gain/loss incurred by each investor and the tax withheld (if any).
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Opening Hours:
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