Tax Types

An NGO or a public entity can and should provide also for the registration of other tax liabilities, according to the legislation in force, in line with the its activity.

In case of performing a lucrative activity, the tax liabilities for which a Non-Profit Organization is charged are:

• Social security contributions are an obligation for each employee of the employer. They are paid partly by the employers and partly by the employee, according to the law.
• Health care insurance contributions are an obligation for each employee of the employer. Also, this type of tax is paid partly by the employers and partly by the employee according to the law.
• The tax on employment income (part of the personal income tax), held for the benefit of income from salaries and bonuses arising from the employment relationship.

Clarification!
Despite the nature of the activity, profit or non-profit, the social security contributions and health care insurance, and the tax on employment incomes (personal income), are mandatory tax liabilities.
Each NGO is part of the category "employers".

Value Added Tax: A NGO is obliged to register for VAT if it carries out economic activities, taxable supplies of goods or provides services against payment based on the provisions of the Law no.92/2014 "On Value Added Tax".

Income tax: A NGO is required to register for the tax liability for income tax, if it carries out economic activity and generates taxable income according to the provisions of the Law no.8438, dated 28.12.1998 "On Income Tax."

Tax at Source: In fact, withholding tax at source is directly connected with the personal income taxation of individuals. Mainly this technique of the tax payment applies to withholding the tax at source for payments related to different types of services carried out by third parties, not registered with the tax authorities, as the trader.

Such payments can be the payments for rented facilities, benefits of membership in a supervisory council, etc.

The NGOs are excluded from the following taxes:

• From VAT, for supplies of goods and providing of services according to the provisions of the Law no. 92/2014 "On Value Added Tax"
• Income Tax, for the cases specified in the provisions of the Law no. 8438, dated 28.12.1998 "On Income Tax".