Home » Legal regulations » Taxation Taxation FATCA/CRS/QI Investimental complies with the FATCA (Foreign Account Tax Compliance Act) requirements, the compliance act regarding the taxation of foreign-source income earned by persons under the jurisdiction of the United States of America, issued by the Government of the United States of America. To this end, Investimental has registered on the IRS (Internal Revenue Service) portal, the tax authority of the United States of America, in its own name, as a financial institution, with GIIN (Global Intermediary Identification Number) 8B9NEW.99999.SL.642. The Common Reporting Standard (CRS) represents the initiative of the Organisation for Economic Co-operation and Development (OECD) for the implementation of the automatic exchange of information in the tax field. A total of 74 countries have so far signed agreements for the exchange of tax information: https://www.oecd.org/tax/automatic-exchange/international-framework-for-the-crs/crs-mcaa-signatories.pdf CRS was implemented within the European Union through Directive 2014/107/EU on the mandatory automatic exchange of information in the field of taxation. These legal provisions aim at ensuring transparency in tax collection procedures and reducing cross-border tax fraud and evasion by eliminating situations where income is not properly reported, which would otherwise objectively prevent the state from applying tax withholdings. Investimental is required to apply reporting and tax due diligence rules, an integral part of the Fiscal Procedure Code, which transpose at national level Directive 2014/107/EU regarding the mandatory automatic exchange of information in the field of taxation. The data subject to the exchange of information in relation to reportable accounts opened by Investimental clients include: the name, address, TIN (tax identification number), date of birth (for individuals) of each reportable person who is the account holder and, in the case of an entity that is an account holder and which, after applying the compliance rules with the common reporting standards, is identified as having one or more controlling persons who become reportable persons, the name, address and TIN of the entity and the name, address, TIN, date and place of birth of each reportable person; the account number; the balance or value of the account at the end of the relevant calendar year or other appropriate reporting period, or, if the account was closed during that year or period, the account closure; the total gross amount of interest, the total gross amount of dividends, and the total gross amount of other income generated in connection with the assets held in the account, in any case paid or credited to the account during the calendar year or other appropriate reporting periods; the total gross proceeds from the sale of financial assets paid or credited to the account during the calendar year or other appropriate reporting periods. Investimental is registered as a Qualified Intermediary (QI) in relation to the IRS (Internal Revenue Service), the tax authority of the United States of America. As a Qualified Intermediary and in compliance with legal regulations regarding customer due diligence, both national and any additional requirements provided by specific US legislation, Investimental may facilitate for its clients the taxation of gains on US markets in accordance with the applicable Treaties concluded by the United States of America with the countries in which Investimental’s clients are tax residents. Clients’ tax obligations According to the provisions of the Fiscal Code, starting from 1 January 2023, income in the form of gains from the transfer of securities and from operations with derivative financial instruments, obtained from Romania as well as from abroad (other than from the transfer of investment gold), through intermediaries that are Romanian tax residents or non-residents having a permanent establishment in Romania and acting as intermediaries, shall be taxed as follows: in the case of securities: 1% on each gain from the transfer of securities that were acquired and disposed of over a period longer than 365 days, inclusive, from the acquisition date; 3% on each gain from the transfer of securities that were acquired and disposed of over a period shorter than 365 days from the acquisition date. in the case of operations with derivative financial instruments: 1% on each gain from transactions with derivative financial instruments held for a period longer than 365 days, inclusive, from the acquisition date; 3% on each gain from transactions with derivative financial instruments held for a period shorter than 365 days from the acquisition date. The determination of the tax value for the calculation of gains from the transfer of securities and from operations with derivative financial instruments is carried out by applying the weighted average price method, including costs related to the transfer/transaction, for each symbol, regardless of the holding period. For the determination of the holding period, securities and financial instruments are deemed to be disposed of/redeemed in the same order in which they were acquired, namely first in – first out, for each symbol. The income tax calculated and withheld at source is declared and paid to the state budget by the intermediary by the 25th day inclusive of the month following that in which it was withheld and represents a final tax. Losses incurred from the transfer of securities and from operations with derivative financial instruments, carried out through intermediaries that are Romanian tax residents or non-residents having a permanent establishment in Romania and acting as intermediaries, are not carried forward and are not offset, representing final losses of the taxpayer. Investimental, in its capacity as intermediary, is required to provide, in written form or by electronic means, to each client, information regarding the total gains/losses and the tax calculated and withheld at source for the transactions carried out during the fiscal year, by the last day of February inclusive of the current year for the previous year. Investimental, in its capacity as representative of clients – non-resident individuals – in relation to ANAF and as intermediary for the income obtained by them from the transfer of securities, is required to obtain the tax identification code (TIN) for the non-resident individual who does not hold such a number, as well as to calculate, withhold at source, declare, and pay the income tax for the non-resident individual who does not prove residence in a state with which Romania has concluded a double taxation avoidance treaty. Tax legislation requires Investimental to request and retain, as supporting documentation, the tax residence certificate in the case of individuals who are tax residents in another state with which Romania has concluded a double taxation avoidance treaty. If you fall into this category, you must submit to Investimental the tax residence certificate issued by the tax authority of your state of residence by the date of execution of the first securities transaction, in order to avoid income tax withholding in Romania. As the validity of the tax residence certificate is the calendar year, the obligation to submit the tax residence certificate is annual, within a maximum of 60 days from the end of the previous year.
