Romania: Reduced VAT rate of 5% for certain residential properties in 2021
Romania: Reduced VAT rate of 5%
Legislation (no. 248/2020) published in the official journal in November 2020 amends the threshold under which the “reduced” rate of value added tax (VAT) is applicable for supplies of residential properties to individuals.
Under the legislation, beginning 1 January 2021, supplies of residential properties will be subject to a reduced VAT rate of 5% when supplied to individuals, if the following conditions are met:
- The maximum useful surface area is 120 m2.
- The transaction price does not exceed the equivalent in RON of €140,000—approximately RON 682,300
- The reduced VAT rate will be applicable only for properties that can be occupied as residences at the moment of the supply.
Read a November 2020 report prepared by the KPMG member firm in Romania
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