Standard Audit File for Tax (referred to as “SAF-T”) is an international standard launched by OECD since early 2010 for digital exchange of reliable accounting data from organizations to their national tax authority on a basis on either on mandatory deadlines or their request. Since then, it has been implemented in multiple countries and, in 2022 it was Romania’s turn to begin the implementation of SAF-T by the Law 207/2015

SAF-T reporting in Romania is based on mandatory submission deadlines and e-format  and is being implemented in stages: large taxpayers in 2022; medium size taxpayers, banks, IFNs, insurance companies and other financial institutions in 2023; for the small taxpayers from 2025.

In the case of Romania, the entities must prepare three sets of SAF-T declarations, with different submission deadlines and intervals:

• monthly or quarterly SAF-T 406 (depending on the size of the company) e-return, which includes “all accounting and fiscal operations”, except for information on Fixed assets and Inventories;
• annual SAF-T of Fixed Assets with a submission deadline similar with the statutory financial statements’ submission;
• SAF-T of Inventories, which will be submitted at the request of the tax authorities within 30 days from the authorities’ request.

Also, the non-resident taxpayers in Romania, but registered for VAT in Romania, will submit a simplified SAF-T declaration, containing only the purchases and sales carried out through the Romanian VAT code.

SAF-T declarations encompasses all the “economic and financial operations” of the entities, i.e., the trial balance, the chronological record of supporting accounting evidence, payments, information regarding the suppliers, customers, purchase / sale invoices, fixed assets, stocks, per VAT rates based on required taxonomy and format. As a result, the SAF-T implementation process is cumbersome and time-consuming, requiring good knowledge of IT, accounting, and taxation, with an emphasis on mapping accounts and transactions to the taxonomy required by the Romanian tax authorities as well as, significant parameterization of your existing accounting applications in order for the corresponding modules that are provided by your accounting application providers or specialized third party vendors, to work effectively.

Non-compliance with SAF-T requirements, such as late or non-submission or incorrect of the e-returns, will trigger from the fiscal authorities not only the quantitative risk factors translated into fines and penalties, but more importantly qualitative risk factors, such as classifying the non-compliant entities as medium or even high-level risk from the tax perspective, with unfavorable consequences such as regular tax audits, difficulties in obtaining tax and VAT refunds, etc.

TGS Romania team can offer you assistance in the implementation stage, with the support in designing and reviewing the data flows required for SAF-T reporting and the mapping of transactions from the VAT perspective and all the codifications requested by ANAF.

We advise entities, especially those who are required by 31/07/2023 to submit their SAF-T 406 e-return to plan their implementation in due time and diligently to avoid unnecessary bottlenecks and delays in meeting the deadline.

For the entities, which are already in the process of implementation or in the final stage we can offer the support of the testing of the SAF-T reporting functionality.

For more details and advise on this important topic, please contact us:

Mihaela Rosu, Partner BPO & Tax TGS Romania m.rosu@tgs-romania.com

Cristian Faica, Senior Manager Tax TGS Romania c.faica@tgs-romania.com