Taxation

08.02.2013 ZF English

Summary of main taxes

  • Standard Corporate Tax: fixed rate of 16%
  • Tax for nightclubs and gambling operations: 5% of total revenue, or 16% of profit, whichever is higher
  • Tax on micro-enterprises (turnover < EUR 100,000): 3% of the turnover
  • Tax for representative offices: annual flat tax of EUR 4,000
  • Standard Individual Tax: flat rate of 16%

 

Social Security Contributions:
 

Contribution Type

Employee

Employer

Social security (CAS)

10.5%

20.8%

Social health insurance (CASS)

5.5%

5.2%

Unemployment fund

0.5%

0.5%

Holiday and social health insurance indemnity

-

0.85% (applied to the salary fund) – capped at 12 times the minimum wage (currently RON 800)

Accidents insurance fund contribution

-

0.15% - 0.85%

depending on Romanian CAEN of the company

Salary guarantee fund

-

0.25%

 

  • Standard Withholding Tax: 16%; 
  • Withholding tax on payments to Romanian residents:
  • Dividends to Romanian resident companies[1]      16%
  • Dividends to Romanian resident individuals        16%
  • Interest to Romanian resident companies               0%
  • Royalties to Romanian resident companies            0%
  • Withholding tax on payments to non-residents:
  • Dividends to non-resident companies[2]                16%
  • Dividends to non-resident individuals                  16%
  • Interest to non-resident companies[3]                    16%
  • Royalties to non-resident companies[3]                                   16%
  • The WHT rates may be reduced by double taxation treaties or EU Directives.
  • Tax on capital gains from transfers of securities: 16%.
  • Standard VAT rate: 24%;
  • Reduced VAT rates: 9% and 5%;
  • Operations exempt with credit;
  • Operations exempt without credit.

 

Additional information:

Fiscal procedures/administration

Direct taxes

Personal income taxation

Local taxes

Indirect taxes


[1] Dividend payments are exempt from tax if the recipient company has owned at least 10% of the distributing company’s share capital continuously for 2 years.

[2] By virtue of the EU Parent/Subsidiary Directive, as from 1 January 2009, profit distributions made by a subsidiary in Romania to its parent company (i.e. which has a holding of at least 10%  for an uninterrupted period of at least 2 years) located in an EU/EFTA Member State, have been exempt from withholding tax.

[3] As from 1 January 2011, interest and royalty payments made to an associated company (one of the companies has a direct minimum holding of 25% in the other, or both are held under more than 25% common ownership for a non-interrupted period of at least 2 years) from an EU/EFTA Member State have been exempt from withholding tax.

For the latest information on taxes and deadlines, see KPMG in Romania’s TaxExpress app, available in Romanian, English, and Chinese in the Appstore: http://bit.ly/14T5RJF, and in Google Play: http://bit.ly/Ua1stw

 

Source: KPMG - Investment in Romania report (May 2013)

Keywords:
Romania
, taxation