Revenues obtained from the sale by individuals of real estate properties are taxed as a percentage of the sale price. For properties sold less than three years from their acquisition, the tax is 3% if the purchase price is less or equal to RON 200,000 or RON 6,000 plus 2% of what exceeds RON 200,000. For properties sold after three years from their acquisition, the tax is 2% if the purchase price is less or equal to RON 200,000 or RON 4,000 plus 1% of what exceeds RON 200,000.
Some exemptions to the tax apply, for example in the case of property donated by close relatives, as defined in the Fiscal Code.
A company’s income from direct and indirect sales of properties (the sale of shares in a property holding company) will be taken into consideration in the calculation of a general profit tax of 16%.
The ownership transfer publicity fee (replacing the formerly so-called “stamp duty”) is payable at the rate of 0.15% of the value of the transaction for individuals and 0.5% of the value for legal entities.
The publicity fee is collected by the notary and paid to the cadastral authority on the date of the authentication of the sale and purchase agreement.
Notary fees are due on the authentication of the deed of transfer of the ownership over real estate by a public notary.
The following taxes are additionally due:
- Tax for issuing planning certificates: RON 14 + RON 0.01 for each sqm exceeding 1,000 sqm (for urban areas). This is reduced to half for rural areas
- Tax for issuing the construction authorization: 1% of the authorised value of the works (without VAT). For buildings intended to be used for living, the tax is 0.5% of the authorized value of the works. The authorized value of works does not include VAT
- Public utility permissions: these permissions should generally be listed in the planning certificate. Also generally the taxes for such permissions are low (fixed nominal values), but public utility providers might request feasibility studies and the issue of the permission is in practice conditional upon paying the fees for such studies. Costs associated with the preparation of a PUZ/PUD (urbanisation plans) may also need to be considered
- Tax to be paid to the state construction inspection (ISC) by investors or owners: 0.7% of the authorised value of the works
- Tax for state control over the construction works (also to be paid to the ISC on communication by the investor of the commencement of the authorized works): 0.1% of the authorised value of the works
- Order of Architects tax of 0.05% of the authorised value of the works
The sale of shares owned by a natural person in a property holding company is subject to an income tax of 16%. Value added tax may also be payable, except (broadly) where the property is sold by an individual or a non VAT-paying company.
The VAT quota for the transfer of ownership over certain so-called “social policy dwellings”, including the ownership over the appurtenant land, has been reduced to 5%. This category includes residential properties having a maximum 120sqm usable area excluding any annexes, which are built on a plot of land (in case of houses) or where the corresponding co-ownership quota over the land (in case of a apartments located into a condominium) does not exceed 250sqm and their value, including the value of the land on which they are built, does not exceed RON 380,000.00 (approx. EUR 90,000). The purchasers of such dwellings can benefit from the reduced VAT quota, if individually or as a family, they have not previously acquired another dwelling subject to the reduced VAT quota.
During the due diligence for the acquisition, the buyer will also pay the costs of conducting searches, including in particular at the local authority (which includes zoning matters, building regulations and general municipal consents, notices etc) and, if relevant, companies providing utilities etc. The buyer will also pay for any valuations and surveys of the physical state of the property and any environmental audits or desktop studies.
The seller will generally pay the commission of any land agent or broker employed to find a purchaser, but in many cases commissions are charged to both seller and purchaser.
Occasionally, the negotiated heads of terms for a transaction will provide for one or other party to pay the other’s costs. Generally each party pays its own expenses.
The purchaser will be responsible for the payment of the Land Book fees associated with registration of the transfer to the purchaser.
For property transactions concluded in a notarised form, a notary fee is payable. These fees may vary between 0.5% and 2% of the transaction value, depending on several mandatory thresholds applied by the notary to ownership transfers. Such criteria are provided by an official notary fees grid which is approved by the Ministry of Justice, which is subject to periodic reviews. The percentage decreases as the value of the transaction increases.
Depending on the size of the transaction, other fees may be triggered, such as fees of valuers, legal counsel and other professionals. There are no rules regarding who pays what, but generally notary fees are paid by the buyer and each party pays its own incurred fees.
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