Complete guide to Romanian taxes for expats. Learn about income tax, Declarația Unică, PFA vs SRL, social contributions, and tax optimization strategies for 2025.
Romania has a relatively straightforward tax system compared to other EU countries. As an expat, you'll mainly deal with income tax, social contributions, and possibly VAT if you're self-employed.
Income Tax: 10% flat rate
Social Contributions: 25% (employee) + 2.25% (health)
VAT: 19% standard rate
Dividend Tax: 8% (if distributed)
You're considered a Romanian tax resident if you:
Romania has double taxation treaties with 90+ countries. This means you won't pay tax twice on the same income. Always check if your home country has a treaty with Romania.
Romania has a flat 10% income tax rate - one of the lowest in the EU. However, social contributions significantly increase your total tax burden.
| Component | Rate | Who Pays | Notes |
|---|---|---|---|
| Income Tax | 10% | Employee | On gross salary |
| Social Security | 25% | Employee | Capped at 5x average salary |
| Health Insurance | 10% | Employee | Mandatory for all |
| Work Insurance | 2.25% | Employee | Unemployment insurance |
Enter your gross monthly salary to see net income:
• Meal vouchers (up to 30 RON/day) are tax-free
• Gift vouchers (up to 300 RON/year) are tax-free
• Transportation allowances are often tax-free
• Private health insurance paid by employer is tax-free
The Declarația Unică is Romania's annual tax return. You must file it by May 25th each year if you have income beyond your main employment.
May 25, 2025: Submit Declarația Unică
July 25, 2025: Pay any additional tax owed
Late penalty: 0.02% per day + 25% penalty
• Personal deduction: 3,000 RON/year
• Dependent deduction: 2,700 RON/year per child
• Health insurance premiums
• Pension contributions
• Professional training expenses
If you're freelancing or starting a business in Romania, you'll choose between PFA (sole proprietorship) and SRL (limited liability company).
| Aspect | PFA | SRL |
|---|---|---|
| Setup Cost | ~100 RON | ~500-1,000 RON |
| Minimum Capital | None | 200 RON |
| Liability | Unlimited personal | Limited to capital |
| Tax Rate | 10% income + 25% social | 16% profit + 8% dividends |
| Accounting | Simple records | Full accounting required |
| VAT Threshold | 300,000 RON/year | 300,000 RON/year |
Choose PFA if: Simple freelancing, low income, minimal liability risk
Choose SRL if: Higher income, need liability protection, plan to grow, multiple partners
PFA owners can choose between different tax regimes:
Romanian banks offer competitive services, but choosing the right one depends on your needs and English language support.
| Bank | English Support | Monthly Fee | Best For |
|---|---|---|---|
| ING Bank | Excellent | 0-15 RON | Digital banking, expats |
| Banca Transilvania | Good | 0-10 RON | Largest network, locals |
| Raiffeisen Bank | Excellent | 5-20 RON | Premium services |
| BCR | Limited | 0-15 RON | Traditional banking |
• Most ATMs are free for same-bank cards
• Contactless payments are widely accepted
• Bank transfers are instant and usually free
• Keep some cash - small vendors may not accept cards
• Avoid airport exchange - rates are terrible
• Use exchange houses in city center for best rates
• Revolut/Wise offer excellent exchange rates
• Never exchange money on the street
| Date | Deadline | Who |
|---|---|---|
| January 31 | Annual salary certificates from employers | All employees |
| February 25 | VAT return (if applicable) | VAT registered |
| March 25 | Quarterly PFA/SRL returns | Self-employed |
| May 25 | Declarația Unică submission | Required filers |
| July 25 | Pay additional tax owed | Required filers |
Late filing penalties are severe: 25% of tax owed plus 0.02% daily interest. Set calendar reminders and file early to avoid stress.
Next Steps:
• Romanian Visas & Residency Permits
• Your First Month in Romania Checklist
• Best Banks for Expats in Romania