Law no. 309/ 2022 amending and supplementing certain provisions of the Fiscal Code regarding income from pensions

Recently, the Official Gazette published Law no. 309 for the amendment of Law no. 227/ 2015 regarding the Fiscal Code.

Law no. 309/ 2022 amends the definition of pension income to include income from occupational pensions regulated by Law no. 1/ 2020 on occupational pensions.

Also, the net contributions of participants to private, facultative or occupational pension funds are no longer included in the taxable income.

The provisions of Law no. 309/ 2022 are to enter into force on 1 January 2024.

Determination of taxable income

• For the amounts received as a single payment by participants to privately administered pension funds and their legal heirs, in accordance with the provisions of Law no. 411/2004, the taxable income is represented by the amounts that exceed the net contributions of the participants, to which each pension fund grants a single tax-free income cap of RON 2,000.
• For the amounts received as payments in installments by participants to  privately administered pension funds and their legal heirs, in accordance with the provisions of Law no. 411/2004, the taxable income is represented by the amounts that exceed the net contributions of the participants, to which the tax-free income cap of RON 2,000 applies for each monthly installment, from each pension fund.
• For the amounts received as a single payment by participants to facultative pension funds and/or to occupational pension funds and their legal heirs, in accordance with Law no. 204/2006 and Law no. 1/2020, the taxable income is represented by the amounts that exceed the net contributions of the participants, to which each pension fund grants a single tax-free income cap of RON 2,000.
• For the amounts received as payments in installments by participants to facultative and/or occupational pension funds and their legal heirs, in accordance with the provisions of Law no. 204/2006 and Law no. 1/2020, the taxable income is represented by the amounts that exceed the net contributions of the participants, to which the tax-free income cap of RON 2,000 applies for each monthly installment, from each pension fund.

For more details, please consult the Official Gazette no. 1109 published on 17 November 2022.

The EY team is available for further details on the above.