KPMG has a good understanding of the current practice of the Romanian tax authorities, gained from assisting a large number of clients is obtaining NIFs for non-resident partners.
According to the Fiscal Procedure Code, non-residents, even those obtaining passive income from Romania, must register with the Romanian tax authorities and receive a tax identification number („NIF”).
Although the registration requirement rests with the non-resident which earns the income, the tax authorities can issue the NIF at the request of the incomer payer as well. The reason why the Romanian taxpayer would want to apply for the registration of non-residents is mainly related to the submission of Form 207Informative tax return relating to withholding tax/exempt income, classified by the non-resident beneficiaries of the income.
Moreover, failure to obtain an NIF can prevent non-residents from requesting a withholding tax refund or obtaining a certificate attesting to the payment of withholding tax (needed by a non-resident for tax credit purposes in its country of residence).