HOW CAN I GET MY MONEY OUT OF MY ROMANIAN COMPANY?

One of the most pressing questions of entrepreneurs concerns the legal way in which money from an LLC goes back or ends up in the pockets of the entrepreneur. Below we list 10 perfectly legal methods to get money out of the company and some information about the related taxes.

1. Settlement of expenses incurred for the company (0 taxes)

Organize personal and professional expenses and make a very clear separation between them. Deductible expenses refer to those expenses that can be settled on the company, practically you can withdraw from the company the value of the expenses incurred by you for this. To know which expenses you can deduct from the company, you can use the “deductible expenses” category from the tax code https://static.anaf.ro/static/10/Anaf/legislatie/Cod_fiscal_norme_11022020.htm#A25 Another method is to evaluate yourself the categories of expenses you want to deduct. If they are logical and if you can always explain to a verifier why you need to hire expense x to carry out the activity, all that remains is to consult with your accountant on the details and you can settle.

2. Withdrawal of an advance of expenses (0 taxes)

If you need to withdraw an advance, for these future expenses to be settled, you can withdraw up to 5000 euros. Do not forget that these amounts must be justified with documents and that you cannot exceed this cumulative amount. For example, if you raised an advance of 5,000 euros, you can justify 1,000 euros and the following month you can withdraw a maximum of 1,000 euros again, so as not to exceed this threshold. Practically, depending on how many withdrawals you have, you will take care that permanently you do not exceed this threshold.

3. Payment of dividends (taxes 5% and 8%)

Once every 3 months, you have the opportunity to withdraw dividends together with your associates. If you have associates, you will not only be able to collect dividends, i.e. parts of the company’s profit, but all associates will collect proportionally from the profit. When paying dividends, your accountant will calculate a tax of 5% (2022) 8% (after 2023) which you will have to pay in the month following the withdrawal of the tax. There are some other obligations that you must check with the accountant: the threshold for paying contributions (additional costs), the single income statement and the preparation of an interim balance sheet, if applicable.

4. Payment of royalties (10% tax)

If you have a registered trademark in your name or if you produce content for which you want to keep the copyright, you can draw up a copyright contract with your company and you can be paid based on it. The copyright contract has lower taxes than a salary (10%) and it is also reported in the single declaration.

5. Payment of salaries (taxes 45%)

The associate and/or administrator has the right to work in the company and collect salaries and other salary rights (meal vouchers, mobility allowance, etc.) just like any other person. Of course, this is the most “expensive” form of remuneration for an associate/administrator.

6. Payment of a per diem/travel allowance (0 taxes)

The administrator can receive a per diem/travel allowance for the trips he makes in the interest of the company. There is a legal basis that establishes the maximum level of the per diem when it is granted for trips in Romania and abroad, you can consult it here: https://lege5.ro/Gratuit/geydsnrsgi/diurna-hotarare-518-1995?dp=gizdmmbqgazde

7. Purchases of personal goods from the associate/administrator (taxes 0)

The associate and/or the administrator can sell to the company goods necessary for the company’s activity: a computer, a tablet, a telephone or a car, all of which can become the elements of a sale-purchase contract. Of course, as for all other categories, a fair price will be used and the purchased goods will actually be used in the activity.

IMPORT/EXPORT ROMANIA-FRANCE-TURKEY

Just as each geographical area is famous for its menu and culinary flavors, so is the way the business environment develops and is influenced by local culture and traditions. Each nation has acquired over time, influenced by socio-economic factors, wars, ethnic diversity and religion, an identity.

When a business in Romania reaches the point where it considers it time to go out into the world, ie to export, it is important to understand these elements. That is why any move of this kind is a strategic, complex one that involves a lot of study and a team to design a business plan suitable for this maneuver.

In some regions, a lack of knowledge of local customs can stop any future collaboration, because you will be seen as disrespectful. External economic relations are based on diplomacy, above all. Understanding and accepting different mentalities, respecting the way a partner views a business relationship and especially openness to diversity, are the foundations of a long-term collaboration.

We learned by doing, and collaborating for a long time with foreign partners. We speak their language, an extremely important element, as I mentioned earlier. And since no one can do them all and cannot speak all the languages ​​of the world, we specialize in trade relations with France and Turkey.

The trade history between Wallachia and Turkey begins with 1878 when they first exchanged diplomatic representatives. From here, choosing to look ahead, economic relations flourished. Immediately after the Revolution, the Romanians were charmed by the Turkish bazaars, their wealth and especially the special way they traded.

They brought to the country everything that fell into their hands and developed a new trade route, set during the communist regime. The Turks, in turn, found in Romania a market eager for colorful clothes, for trucks that could take them out. goods in Western Europe and the preference of Romanians for Turkish cuisine. But everyone who traded in Turkey, came with the same impression, the solidarity of the Turks and the way they promote each other, more like members of a well-known networking group. , are fast and business partners are 99% men.

As for the trade relationship with France, here the partnership is old and well rooted in our culture. We are a French-speaking people and in interwar Iasi French was the language of the salon.

France is strongly represented in Romania, through companies such as Renault, Renault France, Airbus Group, Orange, Valeo, Carrefour, Engie, BRD – Société Générale and many others. In 2018, the volume of Romanian-French trade was 9.03 billion Euros, increasing by 9.54% compared to the same period in 2017.

How does it help us to know all this? First of all, let us understand that both markets are bidding both for foreign investors eager to enter the Romanian market and for Romanian entrepreneurs who want to export.

Because we want to be closer to investors, to be present with them from the very beginning, we opened two partner offices in Istanbul and Paris. Both are taking the first steps with the entrepreneurs there who want to invest in Romania. Also, with their help we can complete the services for the groups of companies we accompany between Romania and Turkey. In this way we ensure control and reporting for groups of companies and ensure the correct reporting of the group.

DIGITIZATION IDEAS FOR SMEs

Digitalisation in businesses is often perceived only in large companies. We often meet the discouraged attitude of fellow entrepreneurs who are at the start of their journey, which links digitalisation to a very high level of Turnover.

This is why we are briefly presenting 6 ideas for digitization for a SME that is still at the start of the journey.

From the start we make it clear that we do not receive sponsorship from anyone and promote anyone’s products, but only share with you, from our experience and our customers the areas where we managed to digitize with a small budget.

  1. Invoicing – Budget 75 Euro / year

E-invoicing largely requires a database allowing for the traceability of documents issued, as well as a log of changes to documents and their archiving. Find more details about this of Article 319 of The Tax Code.

The first step toward digitization could be the use of billing software that allows you to: manage invoice series and numbers, separate billing responsibilities, set up automatic/recurring invoices, send invoices to email, send out non-payment notifications, track receipts and integrate invoicing with the accounting.

The integration of invoicing with accounting involves the automatic take-over of invoices in the accounting, without the need to reintroduce the data but to verify/validate them by the accounting department.

The applications we have tested are FGO, Smartbill, Facturone. As the main accounting software we work with is SAGA, we recommend integration with the FGO, which has the most options for integration with SAGA at the moment. The annual budget is 75 euros for an FGO subscription and 75 euros for a SAGA subscription. If the accountant already has a SAGA subscription, the SME should only invest in an FGO subscription.

  1. MANAGEMENT – SALES MODULE – Budget 200 Euro / year

Retail businesses, online or offline shops, bakeries/restaurants, as well as plumbing/mounting companies need to operate with stock. In these areas, there is a serious risk of mismanagement that comes from the fact that many businesses do not manage their stocks in real time.

There are several low cost solutions for efficient stock management:

  • SAGA Emulator – Cash Register: These are applications distributed by companies selling cash registers and allowing communication between SAGA and the cash registers. In practice, at the time the sale is made, the application adjusts the stock accordingly and submits in the accounts the accounting notes related to sales and management downloads, as well as the receipts via POS or cash.
  • Management programs for OFFLINE shops: Microshop would be a good example of a program that has retail management at store/workstation and is integrated with a cash register. The processed data does not arrive directly in SAGA but can be imported into the program using the import menus.
  • Working Remotely on SAGA – If the volume is large enough, the databases remain in the store space and it is the accountant who connects to a server to access them.
  • Specialized programs for foreign exchange / management orders for installation, construction-assembly, service companies.
  • For online stores, there is enough tracking from WordPress that helps manage inventory and provides sales statistics.
  • Restaurants/bakeries need an application to manage recipes in advance to stocks. A low cost example would be Micro ERP, which manages both recipes and local stocks and also the link to the cash registers.

The budget for each of these options does not exceed 200 euros / year and represents, in our vision, a must-have for these types of business.

  1. HUMAN RESOURCE MANAGEMENT – Budget 0 – 100 Euros / Month

Companies with at least 1 employee must organize a series of HR-specific documents.

Daily attendance and vacation requests can be managed electronically via FGO. Individual timings in the FGO can be completed by an app on the phone by each employee. They are centralized in the company or at the worksite. The app can manage holiday requests and integrate them into individual and centralized timings.

Management of OSH can be done online through easyssm.ro or a similar system that allows training, testing and archiving of OSH documentation in electronic mode.

ore advanced softwares also shows regular health checks, assessment deadlines and training obligations, although we cannot achieve this in the budget targeted in our exercise, however relatively simple solutions can be developed through a well-developed xls.

  1. TRAVEL SPECIFIC DOCUMENTS

We have not yet found an integrated software to cover the need for the forms of travel specific documents. We are not hiding the fact that we have talked to a few I.T. partners and we hope to lay the foundations for a new project to create a simple and easy software for SMEs.

Until then, we have some recommendations on the management of these documents. If you own 5 or more cars in your fleet, then a contract with a petrol station chain would already be recommended to improve fuel cost. By using GPS software such as alarma.ro or softparcauto.ro, you can manage both roadmaps and alerts for insurance expiry times, accident history, etc.

FGO can be used individually, to upload user expense documents by taking photos of documents. This type of loading can successfully replace the document retrieval for the expense statement. It can be uploaded to the same menu and can ensure the partial retrieval of the data in the accounting.

There are a few websites that help simplify data retrieval and document creation. For example foideparcurs.ro helps to easily complete the roadmaps.

  1. TASK MANAGER – Buget 0

A SME has a very dynamic TO-DO system. Tasks are often performed and transmitted 1-1, without a documented follow up.

However, there are some very handy software that we can use, the goals being to manage folder/theme lists in a multi-user system. Trello is an app that allows this kind of interaction, with 0 budget.

Another form of organization can be through Microsoft Teams and even Facebook Workplace. If you have Microsoft licenses, then Teams is also free, and so is Facebook Workplace.

In the same idea, you can use Google Drive as the last solution to manage a TO-DO list in xls.

  1. APPLICATION OF THE FISCAL FILE ACCESS – 0 Budget

For SMEs that have an in-house accounting department or want to be visible on the tax files, there is the possibility to use a robot to access the ANAF platform for filing declarations and checking the tax file.

We use the 4 Secunde application, but we also heard things about THE SAGA online declaration platform and about Tigris, which we have not yet tested.

All 3 applications allow: Checking messages from ANAF, requesting the sheets and various documents issued by ANAF through the SPV, and the automatic filing and archiving of declarations.

These applications are free of charge for users who use only 1 tax code, so we consider them all with 0 budget.

 

This list can continue with the integration of bank statements, entries and so on.

What is really important in our article is that digitization is also possible on small budgets, and that the most effective way to implement solutions is achieved with your reliable economists.