Romanian Tenants To Withhold And Pay Taxes Owed By Landowners

Taxes owed by Romanian landowners will be withheld and transferred to the budget by the tenants, and the owners will not have to file a statement on their income from rents if they choose for their net income to be determined by applying a flat tax rate.

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According to a draft ordinance amending the Tax Code, the tax on income from land lease is computed by the taxpayer withholding 16% of the net income.

The act allows the taxpayer to determine the net taxable income by subtracting a flat rate of 25% of the gross income. The taxpayer is required to state in writing, in the lease contract, that he/she chooses not to determine the net income through an actual income method. The chosen method applies to all income from the respective contract.

If the lease is paid in kind, its value in lei will be determined according to the average prices of the agricultural products, as set through decisions of the county councils or General Council of Bucharest.

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