Romania

Click on each topic for more information
:

TAXES - ACCOUNTING

 

 

Corporate tax

Tax rate for resident companies

16%

   
Tax rate on long-term capital gains No separate capital gains tax is payable by resident entities. Capital gains from sale of immovable property located in Romania or from sale/transfer of shares held in a Romanian legal entity are taxed at the standard corporate tax rate of 16%.
   
System governing groups of companies and dividends paid by subsidiaries to their parent companies Dividends paid out by a Romanian legal entity to another domestic entity are subject to a 10% withholding tax, while dividends paid out by a Romanian company to a non-resident are subject to a 15% withholding tax, or, if a double tax treaty is applicable, to 10% or to a more favourable rate available under the respective treaty.
   
Tax rate on branches Non-resident companies are taxed in Romania at the standard rate of 16% on earnings derived exclusively from their Romanian operations (through branches, other permanent establishment or consortia). A foreign company is considered to have a permanent establishment in Romania, without a legal presence here, if it has any of the following types of presence in Romania: an office; a branch; an agency; a factory; a mine; a place of extraction for gas or oil; a building site that exists for a period exceeding six months.

Representative offices are taxed on a yearly basis, at a lump sum of ROL equivalent of EUR 4,000, payable in two equal instalments.




Income tax

Fiscal year The fiscal year begins on January 1st and ends on December 31st of the same year.
   
Income tax rate A flat tax rate of 16% has replaced the progressive tax rates.
   
Tax deductions or other allowances A monthly general deduction is granted for each Romanian citizen living in Romania. Also, additional supplementary deductions are granted for the family members, dependants of the taxpayer.



VAT rates

Standard rates 19%
   
Reduced rates 9%
Some activities (exports, health, sciences, education, charitable works, finance, insurances) are exempted from VAT.



Other important taxes


Name of tax
Rate
Succession and donation  
No tax but you must declare them to benefit from a stamp duty.  
Tax on natural resources  
3%  
Tax on road infrastructures  
5%  
Land taxes  
1%  


 

Accounting

Introduction
Romanian accounting rules are determined by the Ministry of Finance.


General accounting principles
The balance sheet is presented into accounts with liabilities composed of constant capital and debts, because there is a distinction between long and short-term debts.
The profit and loss account gives priority to the repository of the global production and lets the choice of the cost - classification by nature.

Obligations and publications
Companies have to publish a balance sheet, a profit and loss account and annexes.

Certification and auditing
The external control of accounts must be given to a body of auditors chosen by the company.

Professionals and representative organizations
Accountants associations have some difficulties to get organized, because of the importance of the State in the accounting system.



Useful links
For further information :
KPMG in Romania

Last modified in 2006 - ongoing update
Export Entreprises©, All rights reserved