The Ordinance on Trains (OG 115/2023), recently adopted by the Çolak government, directly affects NGOs and, accordingly, their funding. We are talking about changes both for micro-enterprises that pay income tax and for companies that have income tax. PFAs will no longer be able to divert 3.5%.

Micro-enterprises are no longer able to deduct income tax

“From 2024, I can no longer sponsor in such a way that I have the fiscal opportunity to deduct 20% interest from the tax due. I can still do it, but without any tax benefits,” says tax consultant Cornel Grama, who analyzed the said ruling.

According to GEO, the last fiscal year in which sponsorship/scholarship amounts remaining to be carried forward are deducted from microenterprise income tax is fiscal year 2023.

PFA, self-employment in general, can no longer redirect 3.5%

Taxpayers with self-employment or other types of income can no longer remit the 3.5% annual tax, says Cornel Grama.

According to him, the opportunity remains only with income from wages and salaries.

Income tax: what changes sponsorship

Spending on private scholarships no longer reduces income tax, says fiscal consultant Adrian Benza in an analysis.

According to him, the cost of goods and services provided by UNICEF is added to the cost of sponsorship and reduces the income tax of 0.75% of the turnover, but does not exceed the 20% income tax. Both expenses are initially not deductible when calculating income tax.

It remains possible to redirect the amount of sponsorship or patronage expenses up to the maximum amount provided by law, if the income tax payer submits a redirection form.