Romania – Taxation

How does the tax system in Romania work?

Romania’s tax system is administered at the national level — there are no separate regional or state income taxes of the kind found in federal systems such as those of Germany or the United States. Tax policy, legislation, and enforcement are all handled centrally. The body responsible for collecting taxes and upholding fiscal law is the National Agency for Fiscal Administration (ANAF), accessible through its official website at www.anaf.ro.

How Romania taxes an individual depends fundamentally on that person’s residency status. Romanian tax residents are generally liable for Romanian tax on their income from all sources worldwide, while non-residents face Romanian tax only on income arising within Romania. This structure broadly resembles that of countries like France or Spain, though it differs considerably from the UK’s PAYE withholding model — in Romania, many categories of self-employed income require individuals to calculate and discharge their own tax liabilities independently.

The following categories of individuals are subject to income tax: Romanian tax residents — meaning any person whose domicile is in Romania, whose centre of vital interests is located in Romania, or who is present in Romania for more than 183 days within any 12-month period — as well as non-residents who carry out independent or dependent activities in Romania, or who receive income from Romanian sources.

Non-residents who can demonstrate that their centre of vital interests lies in Romania are treated as Romanian residents from the date on which they formally declare this to the authorities. Non-residents who are physically present in Romania for more than 183 days within any period of 12 consecutive months ending in the relevant calendar year become Romanian tax residents with effect from the date of their first arrival in Romania.

Any individual who has spent more than 183 days in Romania within a 12-month period ending in the relevant fiscal year must submit a dedicated Questionnaire, along with supporting documents, within 30 days of the end of that 183-day period. ANAF will then notify the individual within 30 days as to whether they have full tax liability in Romania or are taxable only on Romanian-source income. The Questionnaire is available on the ANAF website under the “Assistance of taxpayers” section.

Romanian is the official language of fiscal administration. Where supporting documents, certificates, or other materials in a foreign language are submitted to the tax authority, ANAF will require that they be accompanied by certified Romanian translations prepared by translators authorised by the Ministry of Justice. Allow sufficient time in your planning for this, particularly when gathering documentation from overseas.

Does Romania have double taxation agreements, and how do they affect expats?

Romania maintains a broad network of double taxation treaties, which play an important role in determining whether non-Romanian individuals are treated as Romanian tax residents and how their income is taxed. Romania has signed double taxation conventions with more than 80 countries and jurisdictions with the aim of preventing double taxation and facilitating cooperation between Romanian and foreign tax authorities. These partners include the great majority of EU member states, as well as the United States, Canada, Australia, Japan, and many more.

Double taxation agreements prevent the same income from being taxed in two countries simultaneously. Romania has treaties with numerous EU member states and other nations designed to remove this burden. Such agreements typically set out rules for determining which country holds the primary right to tax particular types of income, directly shaping the tax obligations of expats and other individuals resident in Romania.

Where an individual can establish that, during their time in Romania, they continue to be a tax resident of another state with which Romania has a double taxation treaty, the terms of that treaty will take precedence. In practical terms, if you are working temporarily in Romania while remaining tax resident elsewhere — and you can produce a certificate of fiscal residence issued by your home country’s tax authority — you may be able to avoid being treated as a full Romanian tax resident even if you exceed the 183-day threshold.

Under the provisions of Romania’s double taxation treaties, where a Romanian tax resident is also subject to income tax in a treaty partner country, Romania will grant either a tax credit or a tax exemption. The credit is limited to the amount of foreign tax paid, and may not exceed the Romanian tax otherwise due on the same income.

ANAF’s official website provides a comprehensive list of all double taxation conventions that Romania has signed. You can access this list at www.anaf.ro to confirm whether your home country has concluded a treaty with Romania and to review the treaty text. Always check the official ANAF portal, as new treaties may be ratified or existing ones updated from time to time.

Exemption from Romanian social security contributions may be available where a totalization agreement exists between Romania and an individual’s home country, or where EC Regulation 883/04 applies. EU nationals working in Romania may, for example, be permitted to remain in their home country’s social security system for a defined period, thereby avoiding the payment of contributions in two jurisdictions simultaneously.

What taxes do expats need to pay in Romania?

Once you acquire Romanian tax residency, you will be subject to a range of taxes. The following sets out the main categories relevant to expats, with rates as researched for 2025–2026. Always confirm current rates with ANAF or a qualified tax adviser, as Romania has seen significant legislative changes during this period.

Income Tax

Romania applies a flat personal income tax rate of 10%. Wages and salaries paid under an employment contract or other employment relationship are taxed at this uniform rate. At 10%, this is among the lowest personal income tax rates in the European Union, making Romania a competitive destination for those evaluating tax environments across European countries. In contrast to progressive systems prevalent across much of Western Europe — where higher earners pay proportionally more — Romania’s flat rate applies identically at every income level.

Dividend Tax

From 2026 onwards, the tax rate on gross dividends rose from 10% to 16%, affecting both individuals and corporate entities, with transitional arrangements in place for dividends declared on the basis of interim financial statements prepared during 2025. This is a significant development for expats who hold equity in companies or structure their affairs through corporate vehicles, and it warrants careful consideration in any investment planning.

Capital Gains Tax

With effect from 1 January 2026, capital gains on securities traded through authorised intermediaries are taxed at 3% where the securities were held for more than 365 days, and at 6% where held for 365 days or fewer. In all other circumstances, a flat rate of 16% applies from 1 January 2026. Proceeds from the transfer of immovable property are taxed by reference to the transaction value: 3% for buildings and their associated land held for up to three years, and 1% for such properties held for longer than three years.

Social Security Contributions

Romanian tax residents are generally required to pay social security contributions on employment income, comprising a 25% pension contribution and a 10% health insurance contribution. A labour insurance contribution of 2.25% is also applicable. For employees, these amounts are withheld directly from gross salary by the employer. The self-employed and freelancers must calculate and remit their own contributions — consult the ANAF website for the current minimum contribution base, which is set on an annual basis.

Property Tax

Local taxes on buildings and land are determined by location, property type, and assessed value. Residential buildings attract a minimum tax rate of 0.1% of property value, while non-residential buildings are subject to a minimum of 0.5%. Rates are set annually by local councils. Payments are ordinarily divided into two instalments, due on 31 March and 30 September respectively.

Wealth and Inheritance Tax

Romania levies no general net wealth tax or annual net worth charge, distinguishing it from certain other European countries that impose such levies. Similarly, Romania lacks a standalone inheritance or gift tax regime comparable to those in France or Belgium, though asset transfers may still carry income tax or notarial fee consequences. It is advisable to seek guidance from a local professional based on your individual circumstances.

VAT

On 25 July 2025, Romania enacted Law No. 141, raising the standard VAT rate from 19% to 21% with effect from 1 August 2025, and introducing a single reduced VAT rate of 11% applicable to certain goods and services. For those running a business in Romania, VAT registration becomes mandatory once annual turnover exceeds RON 300,000 (approximately EUR 60,000).

Are there any tax breaks or special regimes for expats in Romania?

Romania does not currently offer a non-domicile or remittance-based regime of the kind previously available under Portugal’s NHR programme or Italy’s inpatriate flat-tax scheme. Nevertheless, there are several meaningful incentives and reliefs that expats should be aware of.

IT Sector Income Tax Exemption

Certain categories of employees are exempt from income tax under Romanian law, with IT specialists among those who can qualify. Accessing this exemption requires following a carefully documented process governed by detailed regulations set out in the Romanian Fiscal Code. The exemption makes Romania particularly appealing to technology professionals who satisfy the eligibility criteria. Requirements and the supporting documentation needed should be confirmed with ANAF or a specialist adviser, given the precision with which the rules are drawn.

Personal Deductions

Where your gross monthly salary does not exceed approximately RON 6,050 (RON 2,000 above the national minimum wage), you may be entitled to personal deductions of between 0% and 45% of your income, the precise amount depending on your earnings level and the number of dependants you support. These deductions reduce the taxable base before the 10% rate is applied, and can meaningfully lower the effective tax burden for lower-to-middle income earners.

Voluntary Pension and Health Deductions

Contributions to voluntary pension funds are deductible up to the RON equivalent of EUR 400 per year. Premiums paid for private health insurance subscriptions are similarly deductible up to EUR 400 annually. Though relatively modest individually, these two deductions can be combined to reduce the taxable income of salaried employees.

Micro-Enterprise and Freelance Tax Regimes

Business owners may benefit from Romania’s micro-enterprise regime, which applies a turnover-based tax rather than a profits tax for companies falling below a specified revenue threshold. The turnover ceiling for capital companies qualifying for the 1–3% rate was raised from €100,000 to €250,000 in 2025, before reverting to €100,000 in 2026. Self-employed individuals operating as a sole proprietorship (PFA) may also elect to use a fixed income quota method in lieu of real-system taxation, potentially simplifying compliance. Current thresholds should be verified with ANAF or a local accountant before deciding on a business structure.

EU Social Security Coordination

As an EU member state, Romania is bound by EU social security coordination rules. Exemption from Romanian contributions may be available under a totalization agreement between Romania and the individual’s home country, or by virtue of EC Regulation 883/04. EU and EEA citizens temporarily posted or assigned to Romania may be able to continue contributing to their home country’s social security system for a set period rather than switching to the Romanian system.

How and when do expats file a tax return in Romania?

Romania’s tax year runs from 1 January to 31 December, in line with the calendar year. It is important to understand the filing requirements from the moment you arrive, as certain obligations arise as soon as you establish tax residency.

1. Establish your tax residency status. Any individual who has spent more than 183 days in Romania within a 12-month period must submit a dedicated Questionnaire along with supporting documentation within 30 days of the end of that period. This form is available on the ANAF website at www.anaf.ro.
2. Register with ANAF. ANAF is the principal tax authority in Romania, responsible for collecting taxes and enforcing fiscal legislation nationwide. You will need to register with your local ANAF office and obtain a tax identification number (CIF or CNP).
3. Activate your Virtual Private Space (SPV) account. The Questionnaire and other tax forms can be completed and submitted through ANAF’s Spațiul Privat Virtual (Virtual Private Space) online portal, which also supports free completion assistance provided by ANAF. This platform serves as the main digital channel for filing returns and corresponding with the tax authority.
4. Compile your annual tax return. As a tax resident, you are required to declare your worldwide income by completing and submitting the relevant return forms to ANAF. These forms call for a comprehensive breakdown of all income streams — including salary, investment income, and other earnings from both Romanian and foreign sources.
5. Submit by the annual deadline. Tax obligations are calculated through self-assessment, based on the information provided in the annual income tax and social contributions return, which must be filed by 25 May of the year following the one in which the income was received.
6. Settle any outstanding tax. For employment income, tax is withheld at source on a monthly basis, with the withheld amounts remitted to ANAF by the 25th of the following month. Self-employed individuals are responsible for managing and paying their own tax instalments throughout the year.
7. Maintain thorough records. Retain documentation relating to all income, foreign taxes paid, and any materials supporting treaty claims or exemption eligibility. Foreign-language documents submitted to ANAF must be accompanied by certified Romanian translations.

The majority of expats file their returns through the ANAF online portal, though paper submissions at a local tax office remain an option for those who require assistance. No extension to the annual filing deadline is available, so advance planning is essential. Late submission can result in penalties and interest charges — refer to ANAF’s official website for the current penalty schedule, as figures may change over time. Engaging a Romanian tax adviser experienced in cross-border cases is strongly recommended, especially during your first year of residency.

What are the tax implications of leaving Romania?

If you have become a Romanian tax resident and subsequently decide to relocate, you must follow specific procedures to formally exit the Romanian tax system. Neglecting these steps can leave you with ongoing obligations or unforeseen liabilities.

Upon departing Romania, any individual who has spent at least 183 days outside Romania within a period of 12 consecutive months is required to file a departure questionnaire with ANAF — the equivalent form to the one completed on arrival. This document, the “Set of Questions for Determining the Fiscal Residence of the Individual on Leaving Romania,” is available on the ANAF website and formally signals to the tax authorities your intention to relinquish Romanian tax residency.

A Romanian resident who retains a registered home address in Romania continues to be regarded as resident in Romania, with full fiscal liability, until the date on which their residency changes in accordance with the relevant double taxation convention concluded by Romania. Simply departing the country is therefore insufficient — you must formally notify ANAF and, where applicable, furnish evidence confirming tax residency in your new country of residence.

If you cease to be a Romanian tax resident part-way through the year, you will generally be liable to Romanian tax on your worldwide income only for the portion of the year during which you held resident status. You will be required to file a final tax return for that period and may be entitled to a refund of any taxes overpaid.

Romania does not currently operate a formal exit tax on unrealised capital gains in the manner of certain other EU member states such as Germany or the Netherlands, but professional advice should be sought if you hold substantial assets in Romania at the time of departure — including property, business interests, or investment portfolios. Any income or gains generated by Romanian-source assets after you have left the country will generally remain subject to Romanian withholding tax at the non-resident rate. Retain records of your departure date and any documentation confirming tax residency in your new country, as these may be called upon by ANAF during the de-registration process.

Practical tips for managing taxes as an expat in Romania

• Keep a precise record of your days. The 183-day rule is the principal trigger for tax residency. Maintain a travel diary logging your arrivals in and departures from Romania, supported by passport stamps, boarding passes, or other verifiable evidence. This is especially important if you divide your time between Romania and one or more other countries.
• Register with ANAF without delay. Understanding and fulfilling your tax obligations in Romania begins with registration. Registering with ANAF early — rather than waiting until you approach the residency threshold — gives you the opportunity to familiarise yourself with the system and establish online access well ahead of any filing deadlines.
• Make proactive use of your double taxation treaty. Individuals who are tax residents of countries that have entered into a treaty with Romania may be able to secure treaty protection to reduce or eliminate certain Romanian taxes. Obtain a certificate of fiscal residence from your home country’s tax authority before relocating, as this document may be needed to assert treaty relief.
• Take advice before disposing of assets. The rules governing capital gains in Romania changed substantially from January 2026, with higher rates introduced on securities transactions. If you are considering selling shares, property, or other investments around the time of a move, obtain tax advice beforehand — the timing of a disposal can have a material impact on the resulting tax liability.
• Prepare certified translations in advance. Romanian is the official language of fiscal administration, and any foreign-language documents submitted to ANAF must be accompanied by Romanian translations certified by translators authorised by the Ministry of Justice. Factor in both the time and cost involved if you will be submitting documents originating abroad.
• Stay abreast of legislative developments. Romanian tax law underwent significant reform in August 2025 and January 2026, encompassing increases to VAT, dividend taxes, and capital gains taxes. The regulatory environment has been changing rapidly, and keeping up to date is essential. Consider subscribing to updates from ANAF or a reputable Romanian tax publication.
• Engage a specialist tax adviser. The interplay between Romanian domestic tax law, EU rules, and bilateral double taxation treaties can be intricate — particularly in the year of arrival or departure. A qualified Romanian tax professional with experience in international cases, or an international firm with a dedicated Romanian practice, can assist you in structuring your affairs efficiently and help you steer clear of costly errors.

Frequently asked questions about taxation in Romania for expats

At what point do I become a tax resident in Romania?

Romanian tax residency is triggered as soon as you meet any one of the following conditions: your domicile is in Romania, your centre of vital interests is in Romania, or you have been physically present in Romania for more than 183 days within any 12-month period. The 183-day count starts from the first day you are present in Romania. Once the threshold is crossed, you must inform ANAF through the official residency questionnaire within 30 days.

Will I be taxed on my worldwide income if I live in Romania?

Romanian tax residents are required to declare income from all sources globally. Non-residents, by contrast, are only taxable on income that originates in Romania — such as employment income, self-employment earnings, rental receipts, and investment returns from Romanian sources. Where you are a Romanian tax resident and your home country also taxes worldwide income, the applicable double taxation treaty will govern how relief is given to prevent double taxation.

How is pension income from abroad taxed in Romania?

Foreign pension income received by a Romanian tax resident is in principle subject to Romanian income tax at the 10% flat rate, as it forms part of worldwide income. However, the double taxation treaty between Romania and the country from which the pension is paid may grant that paying country exclusive or primary taxing rights over the income. The precise treatment will depend on the wording of the specific treaty — consult the relevant agreement and seek professional advice before drawing any conclusions.

Does Romania tax capital gains on property sales?

Proceeds from the transfer of immovable property are taxed at 3% for buildings and their associated land held for up to three years, and at 1% for such properties held for more than three years. These rates apply to both residents and non-residents disposing of Romanian property. Capital gains on the sale of securities are subject to different rates — check current rates at www.anaf.ro.

What is the deadline for filing my annual tax return in Romania?

The annual tax return must be submitted by 25 May of the year following the one in which the income was earned. No extension to this deadline is permitted. Where employment income is taxed at source, your employer manages monthly withholding, but you may nonetheless need to file an annual return to consolidate all income sources and claim any applicable deductions or treaty credits.

Are there any taxes I need to pay on inheritance or gifts in Romania?

Romania does not impose a dedicated inheritance or gift tax in the manner of countries such as France, Spain, or Belgium. That said, notarial fees are levied on inheritance proceedings, and any income subsequently generated by inherited assets will be taxed in the ordinary way. If you are set to receive an inheritance from abroad while resident in Romania, consult a tax adviser to understand what reporting obligations, if any, may arise.

Do I need to pay social security contributions in Romania if I already contribute in another country?

Exemption from Romanian social security contributions may be available where a totalization agreement has been concluded between Romania and the individual’s home country, or where EC Regulation 883/04 applies. EU and EEA citizens who are temporarily posted to Romania may be entitled to remain in their home country’s social security scheme by obtaining the appropriate certificate — such as an A1 certificate within the EU. Check with your home country’s social security authority and secure the relevant certificate before commencing work in Romania.

Can I file my Romanian tax return online?

Most expats submit their returns electronically through the ANAF portal. ANAF’s digital platform — the Spațiul Privat Virtual (Virtual Private Space, or SPV) — enables registered users to file returns, exchange correspondence with ANAF, and access their tax records online. Physical submission at a local tax office is also possible for those who prefer or require in-person assistance. Initial registration for the SPV may necessitate a visit to an ANAF office in person to verify your identity. Full registration guidance is available at www.anaf.ro.