Tax Guide for Expats in Romania
Understanding Romanian taxes – whether employed, freelancing, or running a business.
Tax Residency
When Are You Tax Resident?
You become a Romanian tax resident if:
- You spend 183+ days in Romania in any 12-month period, OR
- Your center of vital interests is in Romania (home, family, business)
What Does It Mean?
- Tax residents: Taxed on worldwide income
- Non-residents: Taxed only on Romanian-source income
Employment Taxes (CIM Contract)
Employee Contributions
| Contribution | Rate | What It Covers |
|---|---|---|
| Income Tax (Impozit) | 10% | Goes to state |
| Social Security (CAS) | 25% | Pension |
| Health Insurance (CASS) | 10% | Public healthcare |
| Total Employee | 45% |
Employer Contributions
| Contribution | Rate |
|---|---|
| Work Insurance (CAM) | 2.25% |
Example Calculation
Gross salary: 10,000 RON
- CAS (25%): -2,500 RON
- CASS (10%): -1,000 RON
- Taxable base: 6,500 RON
- Income tax (10%): -650 RON
- Net salary: ~5,850 RON
Self-Employment Options
PFA (Persoană Fizică Autorizată)
| Aspect | Details |
|---|---|
| Best for | Freelancers, consultants |
| Income tax | 10% on profit OR 1-3% on revenue (norma de venit) |
| Social contributions | 25% CAS + 10% CASS (on minimum wage if income > 12 min wages) |
| VAT | Required if turnover > 300,000 RON/year |
| Accounting | Simple (can do yourself) |
Micro-SRL (Micro Company)
| Aspect | Details |
|---|---|
| Best for | Small businesses, contractors |
| Revenue tax | 1% (with employee) or 3% (no employee) |
| Limit | Up to 500,000 EUR/year revenue |
| Dividends | 8% tax when extracting profits |
| Accounting | Need accountant (~200-500 RON/month) |
Standard SRL
| Aspect | Details |
|---|---|
| Best for | Larger businesses, multiple shareholders |
| Profit tax | 16% |
| Dividends | 8% |
| VAT | 19% (required above threshold) |
Comparison: Employee vs PFA vs SRL
On equivalent 10,000 EUR/month gross income:
| Structure | Net Monthly (approx) | Admin Burden |
|---|---|---|
| Employee (CIM) | ~5,500 EUR | None |
| PFA (real system) | ~7,500 EUR | Low |
| Micro-SRL (1%) | ~8,500 EUR | Medium |
Note: Simplified, actual amounts vary based on deductions and structure.
Important Deadlines
| What | When |
|---|---|
| Annual tax return (individuals) | May 25 |
| Quarterly declarations (PFA/SRL) | 25th of month after quarter |
| Monthly declarations (employers) | 25th of following month |
| Annual financial statements (SRL) | May 30 |
Finding an Accountant
English-Speaking Accountants
- Accace Romania – International firm | accace.ro
- Mazars Romania – Big 4 adjacent | mazars.ro
- TaxHouse – Expat-friendly | taxhouse.ro
- Contexpert – Good for startups | contexpert.ro
Costs
- PFA accounting: 100-300 RON/month
- Micro-SRL: 200-500 RON/month
- Standard SRL: 500-1500 RON/month
- Tax consultation: 100-300 EUR/hour
Common Tax Benefits
- IT exemption: Income tax exemption for IT employees (conditions apply)
- Construction exemption: Reduced taxes for construction workers
- Personal deductions: For dependents
- Private pension: Up to 400 EUR/year deductible
Useful Resources
- ANAF (Tax Authority): anaf.ro
- SPV (Virtual Private Space): Online tax portal
- Tax calendar: anaf.ro/calendar
Last updated: December 2024
