The main novelty of the single declaration, in addition to simplifying the method of declaration and payment as a result of the merging of seven forms, is the transition to the self-taxation system. What are the implications of this change for individual taxpayers who earn income from self-employment?
The Right Introduction
The introduction of the self-taxation system means that the declaration and establishment of tax obligations will be made directly by taxpayers. Thus, the self-employed individuals will communicate in the single declaration regarding the income tax and social contributions the income realized in the previous year and will estimate the income to be realized for the current year. You can visit www.taxfyle.com/blog/independent-contractor-taxes for the best deals.
- Therefore, the tax authorities will no longer have, as before, responsibilities in processing returns and issuing tax decisions, the single return being a tax claim on the date on which the payment deadline provided by law, respectively March 15 of the year following.
- After this period, in case of non-payment of the tax obligations declared and due according to the single declaration, the tax authorities will be able to initiate enforcement actions by issuing summonses and enforceable titles according to the Fiscal Procedure Code.
The Additional Options
Additionally, the tax administration may initiate the tax inspection at the level of individuals to verify the income declared according to the supporting documents, the correctness of the tax base and the accuracy of the tax obligations due, on principles similar to tax inspections carried out at the level of legal entities.
New Systems for You
The new system clearly represents a simplification of bureaucratic procedures for taxpayers and a significant relief for tax authorities. Taxpayers will submit a single declaration and will have a single payment term, eliminating the seven forms they have submitted so far (D200, D 201, D 220, D221, D600, D604, D605), as well as the four advance payments. In turn, the authorities will no longer be loaded with hundreds of thousands of forms with different information on the tax situation.
Also for the sake of simplification, 5% bonuses are provided if the single declaration is submitted electronically until July 15, 2018 and if the tax obligations are paid in full by December 15, 2018. If both conditions are met, the 10% bonus is granted.
The Other Options
Another novelty was introduced in the case of income from intellectual property rights, which were excluded from the category of income from independent activities, being regulated differently as income withholding tax. For this reason, people who earn such income will not be included in the self-taxation system. Both the income tax and the social insurance contributions will be calculated, withheld and transferred to the state budget by the income payer, the taxation being final. In other words, no tax returns for regularization will be submitted later.
What You Need
If a person receives intellectual property income from several payers, he will designate by contract the income payer who will withhold and pay the income tax and social contributions due. Also, it returns to the situation in which the persons with incomes from intellectual property rights do not owe social insurance contributions for these incomes, if they are employees at the same time.