HMRC internal manual

Double Taxation Relief Manual

DT16054 - Romania: Commission

Commission, defined as payments made for services as an agent, derived by a resident of the United Kingdom from Romania, may be taxed in both countries. The tax chargeable in Romania is limited to 12½per cent of the gross payments, but if the recipient has in Romania a permanent establishment with which the commission is effectively connected (see INTM153110 fifth sub-paragraph), or if he elects under Article 13(7) to be treated as though he had such an establishment, the Romanian tax chargeable on the payments will be calculated as if they were industrial or commercial profits attributable to that permanent establishment and taxable under Article 7.

Whether or not the United Kingdom resident recipient elects to have Romanian tax calculated in accordance with Article 13(7), the United Kingdom measure of the doubly taxed income will be the net commission after deduction of expenses attributable to the commission (INTM168062).