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NNDKP Successful For Enel in Fiscal Dispute

NNDKP Successful For Enel in Fiscal Dispute

Romania
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Nestor Nestor Diculescu Kingston Petersen has successfully represented Romanian electricity distributor ENEL E-Distributie Banat in a tax dispute regarding tax depreciation for transferred fixed assets. 

According to NNDKP, the dispute concerned “the possibility of the taxpayer deducting the value of tax depreciation for tangible assets (electricity grid connectors) acquired from the company’s clients through transfer, for the calculation of corporate income tax. Initially, tax authorities rejected this possibility based on the way in which the company acquired the connectors (free of charge) and considering the existence of accounting depreciation rules different from the tax depreciation rules that were used.” 

According to the firm, “this dispute shed light on significant tax law matters, including on the taxpayer’s right to opt for an accounting depreciation period different from the periods provided by the law for tax depreciation. Furthermore, the court also considered the effect that the different accounting and fiscal depreciation rules would have over time on the tax base for corporate tax from a fiscal perspective. The rationale for this, also confirmed by the court, relies on the different purposes of the two types of depreciation. The accounting depreciation aims to accurately reflect a company’s financial value and allow the exercise of professional judgment in determining the period over which the asset will bring economic benefits to the taxpayer. The purpose of tax depreciation is to ensure the recovery/fiscal admission of the acquisition cost based on the criteria provided by the fiscal law and, implicitly, the accurate determination of the tax base for corporate income tax, including when the fixed asset is donated to the company.”

NNDKP’s team included Partners Daniela Gramaticescu and Silviu Badescu and Senior Associate Alexandru Lacureanu.

NNDKP at a Glance

Nestor Nestor Diculescu Kingston Petersen (NNDKP) is a promoter of business law in Romania with more than 30 years of experience, independently acknowledged as a pioneer of the Romanian legal market.

NNDKP offers full-service and integrated legal and tax advice to companies from diverse industry sectors. For the past three decades, NNDKP lawyers have assisted corporations, financial institutions, private equity funds and local entrepreneurs in landmark deals and projects in Romania, contributing to the evolution of the Romanian business environment, including in innovative and niche economic sectors.

NNDKP’s team brings together knowledgeable, talented and dedicated lawyers and tax advisors active in Romania, with an impressive track record that reflects a mix of industry insights, courtroom experience and practical business sense. Over 120 lawyers & tax & IP counsellors and 50+ business support professionals form one of the largest and most respected teams of independent professional services providers in Romania. We are on the ground where needed, working either from our headquarters in Bucharest or from our regional offices in Timisoara and Cluj-Napoca – major cities and important economic, academic and social hubs in Romania.

NNDKP provides assistance in virtually all areas of practice including Advertising, Banking & Finance, Capital Markets, Competition and State Aid, Consumer Protection, Corporate / M&A and Commercial, Data Protection, Dispute Resolution, Employment, Energy and Natural Resources, Environment, EU Law, Gaming, Immigration, Insurance and Private Pensions, Intellectual Property, Pharmaceuticals and Healthcare, Infrastructure, Public Procurement and PPP, Real Estate and Construction, Tax and Telecommunications and Media.

Along the years NNDKP has established strong connections with leading international law firms and high-profile professional networks. NNDKP represents Romania in the prestigious international professional alliances Lex Mundi, World Services Group, International Attorneys Club and is a founding member of SEE Legal.

The firm is constantly top ranked in all practice areas by the renowned international guides Chambers & Partners, Legal500 and IFLR 1000. NNDKP is a 6-time winner of the much-coveted “Romania Law Firm of the Year” award at the Chambers Europe Awards gala, in 2022, 2021, 2017, 2013, 2012 and 2009.

Firm’s website: www.nndkp.ro