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Obligatory SAF-T reporting for iScala and Kinetic users in Romania from the 1st of January 2022

Where and when will it be needed?

Some countries have already introduced this new SAF-T reporting standard for tax, VAT, and accounting, like Luxembourg, France, Portugal, Austria, Poland, Germany, Lithuania, and Norway. The list of countries is continuously growing throughout Europe. Romania has decided to start the digital tax reporting roll-out in their region.

From the 1st of January 2022, SAF-T reporting will also be obligatory in Romania, starting with large taxpayers as phase one in this roll-out. Companies and organisations that continue to ignore this change in tax reporting might face penalties or fines from the local authorities. 

It is vital to understand the requirement and act accordingly. The following paragraphs will guide and show you how to risk-avoiding penalties and stay up-to-date with your tax reporting compliance.

 

 

What is SAF-T?

SAF-T stands for "Standard Audit File for Tax" and is an electronic XML based reporting standard for tax, VAT, and accounting. The SAF-T will also be known as D406 Informative Declaration. The OECD (Organisation for Economic Co-operation and Development) prescribed the original format of this SAF-T report, and Romania decided to follow this proposed format.

This SAF-T report should be handed over to the tax authorities in a PDF document with the XML file attached. The creation of this digital VAT return report XML file should be performed by an ERP (Enterprise Resource Planning) system, like iScala or Kinetic. Further, the final D406 return needs to be digitally signed using a qualified digital certificate.

Taxpayers must file their SAF-T reports according to their VAT reporting obligations, which could be monthly or quarterly. SAF-T files will need to be sent to the tax authorities by the end of the month following the reporting period.

 

Are Epicor iScala and Kinetic (ERP) users in Romania affected by this?

All active Epicor iScala and Kinetic (formerly known as ERP 10) users are affected by this regulatory change from the Romanian Tax Authorities called ANAF (Agenția Națională de Administrare Fiscală). This regulatory change will affect iScalas and Kinetic users business communication with the tax authorities.

It's highly recommended to get prepared for this change ahead of the deadline. Customers who wait until the last minute risk a shortage of consulting capacity for the implementation process. This is unnecessary, and it's recommended to plan this regulatory change as early as possible.

Epicor and its channel partners in region, are prepared to support and consult iScala and Kinetic customers in Romania. Changes and updates that need to be applied will vary from customer to customer, so that individual structured consulting sessions will be required. Our goal is to ensure that active Epicor customers comply with the new regulations and benefit from an up-to-date automated reporting process.

 

What needs to be done?

What needs to be done depends on each individual customer's situation. Some iScala on-premises user might not run their systems on the latest release, 3.5; others might miss the required "Electronic Reporting Tool" license that is needed to support this SAF-T tax reporting process. Epicor or the local channel partner will be able to analyse each customer situation and recommend the required activity. This would also include preparing the required SAF-T reporting structure from the active ERP system.

We expect a two-to-four-day consultant service in most cases plus the "Electronic Reporting Tool" license fee. This is just our average estimation, and it might vary by customer and their current iScala / Kinetic solution status.

Epicor together with their local channel partners highly recommend that iScala and Kinetic users respond to the communication request we send out separately to our registered customers. This allows to plan compliant consultancy sessions with each customer and recommend the required activity for organisations to stay compliant with this updated tax regulation. 

 

Next steps?

If you have not yet received this SAF-T compliant message and running an Epicor iScala or Kinetic ERP solution, please register your interest in learning more about this implementation change by filling in the contact form here

Nina Domingo (Director Product Management, iScala)

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