Tax Audits Add €131M in Transfer Pricing Claims

The Romanian National Agency for Fiscal Administration (ANAF) announced that it audited 152 taxpayers between June 2025 and April 2026, establishing additional tax obligations totaling 655 million lei following transfer pricing inspections. Between June 2025 and May 2026, ANAF reviewed intra-group transactions worth more than 199.1 billion lei as part of tax audits focused on transfer pricing. The inspections targeted transfer pricing practices used in intra-group transactions, generally involving companies with significant volumes of related-party transactions, recurring losses, or profitability levels below comparable firms operating in the same industry.   Following the inspections, tax authorities established additional tax liabilities of approximately 655 million lei.   Of this amount, more than 386 million lei represents additional corporate income tax. Transfer pricing adjustments alone generated around 179 million lei in extra profit tax, accounting for nearly 46% of the total additional corporate income tax assessed during the audits.   The inspections focused on taxpayers with high volumes of transactions involving affiliated entities, as well as companies reporting recurring tax losses or significantly lower profitability compared to similar businesses in the same sector.   The audits examined the structure, value, and nature of transactions conducted with both affiliated and independent parties, in order to assess the impact that intra-group transactions may have on the fiscal results of the audited companies.   Among the aspects reviewed were: the economic justification of transactions; documentation for intra-group services purchased; the functional profile of the companies involved; the allocation of functions, assets, and risks; the structure of cost bases and revenues related to intra-group transactions; and the profitability margins applied to the cost base of each analyzed transaction.   Authorities also examined cost allocation and recharge policies, the existence of supporting documentation, and the consistency between transfer pricing documentation and the actual conduct of the parties involved.   In several cases, inspectors identified significant costs generated by intra-group transactions lacking sufficient economic justification or clear supporting documents regarding purchased services, the economic benefit obtained by the taxpayer, or the necessity of those services for operations carried out in Romania.   ANAF also noted a recurring trend showing that the higher the share of related-party transactions within a company’s overall activity, the greater the risk of influencing taxable results through transfer pricing policies. In many of the reviewed cases, this led to a reduction of the taxable base in Romania or unjustified tax losses.   As a result of the audits, the taxable base of the inspected taxpayers was increased by more than 3.38 billion lei. Around 2.21 billion lei of this amount came directly from transfer pricing adjustments. The total value of all adjustments made during the inspections reached approximately 2.27 billion lei.   The inspections also affected reported tax losses. Fiscal losses declared by the audited companies were reduced by around 1.79 billion lei, including nearly 886 million lei resulting from transfer pricing adjustments.   Transfer pricing refers to the prices used in transactions between affiliated entities. Such transactions must comply with the arm’s length principle, meaning that the terms agreed between related parties should not differ from those that would apply between independent parties.   Fiscal risks arise when these prices are used to artificially reduce taxable profits in Romania through unjustified intra-group costs or profitability margins below industry standards, effectively shifting profits to other tax jurisdictions.   The audit results were largely upheld during administrative appeal procedures. Taxpayers contested approximately 324 million lei in additional corporate income tax, of which more than 141 million lei related to transfer pricing adjustments.   Of the contested amounts, around 193 million lei — nearly 60% — were rejected during the appeals process. Only about 260,000 lei worth of claims were accepted. According to ANAF, these results demonstrate that taxpayer selection was based on risk analysis and that inspectors’ conclusions were supported by solid documentation and data.   The largest adjustments were concentrated among a relatively small number of companies. ANAF’s analysis shows that the top 15 companies accounted for approximately 64% of the total transfer pricing adjustments, while the top 10 represented around 60%.   The most significant adjustments were identified in sectors with high volumes of intra-group transactions and complex operational structures, including: automotive component manufacturing and distribution; petroleum product manufacturing and distribution; industrial equipment and mechanical component production; textile industry; real estate; and transport services.   ANAF recommends that taxpayers maintain complete and up-to-date documentation for intra-group transactions and ensure that transfer pricing policies reflect the economic and operational reality of their activities in order to reduce fiscal risks and strengthen voluntary compliance.   The agency emphasized that the purpose of the audits is not to penalize companies conducting intra-group transactions, but to identify situations where such transactions are used to reduce Romania’s taxable base or generate unjustified fiscal losses.   ANAF added that inspections specifically target taxpayers failing to comply with fiscal legislation, while maintaining a predictable framework for companies that voluntarily comply with tax rules.