Tips & tricks

Taxes and feed for the SMEs registered in apartments

Owners of new small and medium enterprises have become major players in the Romanian real estate market, having relatively high purchasing power and courage when it comes to risk taking and investments. But a business is not easy to develop, and legal aspects are the basis for successful entrepreneurship.

If you count yourself among them and think about renting an apartment for the headquarters of your new company, don’t forget that you first have to analyse the costs arising from the move. With regard to the situation of "apartment firms", authorised PFAs and liberal professions, space must allow you and your employees to work, from all points of view.

For example, renting an apartment as a registered office may be a good option for you - in the long run and this "expense" can be seen as an investment in the future. For the choice of space, you have to consider the number of people who are going to work, the utilities (if the building is new, the situation may not be completed), the location and the area, the parking spaces in the vicinity, the need for renovation / reconditioning and summer / wintertime spending.

Taxes and fees

You can register the headquarters of several companies in a single apartment, but pay attention - the number of companies that can be registered depends on the number of rooms. This is only possible if:
- at least one of the associates of the respective companies is jointly associated;
- at least one of the associates of the respective commercial companies is the owner of the building in which the office is to be registred.

Do not count the hallways, the kitchen, the bathroom, the closet, etc. And in the case of rented or purchased apartments for the purpose of transforming the real estate into a commercial establishment, the neighbors must agree to establish the head office of the company together with the executive committee of the owners' association.

If a homeowner owns a shop or a cabinet (carries out an economic activity), the tax paid remains only for the house, provided the utilities are not deducted from the expenses. If the said activity is carried out only in a part of the house, two separate taxes can be paid: a large one for the area / room dedicated to the firm and a small one for the living area. Non-deductible owners are, however, required to file a tax return.

Attention, however, - the decision to opt for the non-execution / non-delivery of utilities in order not to pay increased tax may induce certain risks to the activity. The activity could be, therefore, tax restored and re-enacted to income from dependent / wage activity. In the case of companies, the lack of activity at the registered office or at the work points has a high risk of invalidation or refusal to grant the VAT code.

If an apartment is used for the first time as a registered office, you need to change your destination from a living space into a commercial space - you need the agreement of your direct neighbours and the housing association, even if you do not plan to do business in the headquarters. Details can be found in law 114/1996 (article 64).

In the case of a refusal that you think is unjustifiable, you can go to court for a favorable decision. The good part is that once you become a registered office (commercial space), you can then do actual business there if you change your strategy for the company.


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