Since January 1, 2016, capital gains taxation—specifically the difference between the agreed sale price of financial assets being alienated and their acquisition value—has been integrated into the income tax system. Capital gains are taxed at a rate of 12%.
Financial assets include shares in companies, and their alienation must be reported to the Tax Administration within 8 days. The income tax on capital gains from the alienation of shares is paid based on the Tax Administration’s decision within 15 days of the decision’s delivery.
Shares Acquired Before January 1, 2016
The capital gains taxation provisions do not apply to the alienation of financial assets acquired before January 1, 2016. Therefore, capital gains from the sale of shares acquired before this date are not subject to income tax. In this case, there is no obligation to report the contract to the Tax Administration or to file a JOPPD Form report.
Tax Exemptions
Income from capital gains is also not taxed in cases of alienation::
- Between spouses, direct relatives, and close family members;
- Between divorced spouses related directly to the divorce;
- Pertaining to the inheritance of financial assets;
- After two years from the acquisition date.
For these exemptions, as they involve non-taxable share transactions, there’s no need to submit contracts to the Tax Administration within 8 days. However, capital gains must be reported on the JOPPD Form. The JOPPD is submitted by the end of February of the current year, with the report date and code as of December 31 of the previous year, for capital gains realized in the preceding year.
