Romania: Latest changes to Romanian R&D over-deduction rules – follow up

As per our newsletter published in early October 2022, the norms on deductions for research and development expenses when calculating taxable income for profit tax purposes were amended by Order no. 3265/21453/2022.

According to Order no. 3265/21453/2022, a National Register of Experts must be established to certify research and development activities. Now, the Ministers of Finance and of Research, Innovation and Digitization have issued and published in Official Gazette no. 1051/31.10.2022, Order no. 21578/2022 to approve the founding of the National Register of Experts for certification of research and development activity (REXCD), the selection methodology for the Body of Experts and the Methodological Norms regarding expertise for the certification of research and development activities (the “Order”).

Thus, the fiscal incentive has become fully applicable for companies.

We would like to remind you that companies have the option of requesting certification of their activities by an expert registered in the National Register of Experts. Large taxpayers are obliged to request certification of their research and development activity.

The main stages of certification of research and development activities are:

1. Stage I – The company requests an expertise to certify its research and development activities by submitting a written request to the competent authority;

2. Stage II – An expert from REXCD is appointed to carry out the expertise – the expert is appointed by the competent body by 15 days after submission of the request under stage I;

3. Stage III – The expert and the company sign the expertise contract for certification – models of relevant documentation are provided in the Order. The Order provides for indicative fees and working hours to set the price of the expertise;

4. Stage IV – The expertise for certification is conducted and the expertise report and certification are drafted.

When the review process has been completed, the competent authority for research and development can initiate verification of it, with prior notification of the company and the expert, exclusively to detect possible procedural defects.