Romania Company Formation: Costs and Taxation 2026

Company formation in Romania attracts entrepreneurs seeking a corporate presence in the European Union, relatively low taxation, and access to a market of over 19 million inhabitants. The primary legal form is the SRL, the Romanian limited liability company. However, in 2026, the figures circulating in older guides are no longer reliable: the micro-enterprise regime threshold has been reduced, dividend tax has increased, and VAT rates have changed.

In this guide, you will find what is required for company formation in Romania, the actual costs, when a 1% tax on turnover applies, when a 16% corporate tax is in effect, what you pay on dividends, and what obligations continue after registration. The information reflects the framework valid in September 2026 and requires individualized confirmation before any investment.

Company Formation in Romania: The Basics in 60 Seconds

Topic	What Applies in 2026
Common Legal Form	SRL, Limited Liability Company
Shareholders	From one, natural or legal person
Administrator	At least one, can be a foreign national
Share Capital	500 RON for new SRLs, with a special increased threshold when turnover exceeds 400,000 RON
Micro-enterprise Tax	1% on taxable turnover, only if all conditions are met
Micro-enterprise Threshold	100,000 euros annual turnover
Standard Corporate Tax	16% on taxable profits
Dividend Tax	16% from January 1, 2026
Standard VAT	21%
VAT Exemption Threshold for Small Businesses	395,000 RON annually

The 1% is not an automatic tax that every new Romanian company pays. It is a special regime with specific criteria. If one of these is not met or if the threshold is exceeded, the company is taxed at 16% on profits.

What is an SRL and What Protection Does it Offer?

The Societate cu Răspundere Limitată, known as SRL, functionally corresponds to a limited liability company. It constitutes a separate legal entity, has its own tax identification number, signs contracts, issues invoices, and maintains a corporate bank account.

As a rule, the liability of shareholders is limited to their contribution. This protection does not cover fraud, personal guarantees, illegal distributions, or serious breaches of the administrator's duties. Proper corporate operation requires the separation of personal and company funds, valid documentation, and recorded decisions.

Can a Greek National Open an SRL?

Yes. A citizen of Greece or another country can be the sole shareholder and administrator. A Romanian partner is not required solely due to nationality. However, a real corporate headquarters in Romania, appropriate corporate documents, and collaboration with a local accountant are necessary.

Mandatory Elements for Formation

1. Company Name and CAEN Activities

Initially, the company name is checked and reserved. Then, the main and secondary CAEN codes, which are the official activity codes, are selected. Their selection affects licenses, declarations, and, in some cases, tax treatment.

2. Registered Office

Every SRL requires a declared registered office in Romania. The use of a residence, leased office, or registered agent service must be proven with a legal title. A postal address without the right of use is not sufficient.

3. Shareholder and Administrator

The company can have one shareholder and one administrator, even the same person. The articles of association define the term of office, signing powers, and whether administrators act individually or jointly. The administrator is responsible for compliance with the law, timely submission of declarations, and protection of company assets.

4. Share Capital

For new SRLs, the minimum capital is 500 RON. Following the changes in Law 239/2025, a capital of 5,000 RON is stipulated for companies exceeding an annual net turnover of 400,000 RON. Capital is not a consultant's fee or a tax: it belongs to the company and is used according to corporate rules.

5. Ultimate Beneficial Owner

The natural person who ultimately owns or controls the company must be identified. The ultimate beneficial owner declaration is updated when ownership or control details change.

Steps for Company Formation in Romania

1. Business model and tax residency review.
2. Company name reservation and CAEN code selection.
3. Securing a legal registered office.
4. Drafting articles of association and appointing shareholders, administrator, and capital.
5. Gathering IDs, declarations, and translations where required.
6. Submitting the file to the National Trade Register Office, ONRC.
7. Tax activation, bank account, and initiation of accounting monitoring.
8. Checking for VAT, intra-community transactions, employees, and e-invoicing.

A complete file can be processed in approximately 5 to 10 business days, though this is not a guaranteed deadline. Incomplete proof of registered office, incorrect CAEN, or foreign documents without proper authentication cause delays.

Cost of Company Formation in Romania

There is no single official package for foreign nationals. The total cost depends on translations, the registered office, the complexity of the articles of association, the number of shareholders, and whether physical presence is required.

Category	Realistic Range	Note
Company Capital	From 500 RON	Company asset, not provider expense
Legal Preparation and Registration	Approx. 400 to 1,200 euros	Varies significantly per case
Translations and Certifications	Approx. 100 to 400 euros	Depends on documents and shareholders
Registered Office	Approx. 250 to 800 euros per year	Higher for a physical office
Banking Support	From zero to several hundred euros	Depends on bank and provider

Thus, a simple case often starts around 800 to 1,500 euros, including professional support, without physical office rent and without operating costs. Prices are indicative, not a government tariff.

Annual Maintenance Cost

The low registration cost should not be confused with the annual cost. An active SRL has double-entry accounting, declarations, banking fees, a registered office, and potentially payroll.

• Accountant: typically 100 to 300 euros per month for a small company, more with VAT, staff, or many transactions.
• Registered Office: approximately 250 to 800 euros annually for basic service, depending on the city and amenities.
• Payroll: salary, withholdings, and employer contributions when an employee is required.
• Bank and Software: account fees, payment fees, and e-invoicing.
• Annual Statements: usually included or billed separately by the accountant.

For a small SRL without complex transactions, fixed costs before taxes can range from approximately 2,000 to 5,000 euros per year. With a mandatory employee, a physical office, or an increased volume of documents, the amount rises significantly.

1% Turnover Tax for Micro-enterprises

As of 2026, the Romanian micro-enterprise regime tax rate is 1% on the taxable revenue base. The annual limit is 100,000 euros. The Romanian tax administration ANAF has published the application conditions for 2026.

Key conditions include:

• Revenue up to 100,000 euros, including associated businesses where applicable.
• At least one employee or equivalent eligible relationship that meets the legal requirement.
• Timely submission of annual financial statements.
• Restriction on shareholder participation of over 25% in multiple micro-enterprises.
• The activity must not belong to the excluded categories.

The changes in OUG 8/2026 removed some previous restrictions but did not abolish the basic eligibility check. If the 100,000 euro limit is exceeded within the year, the company switches to a 16% profit tax from the relevant quarter. The 1% is not applied to the first portion and 16% only to the excess amount.

Turnover Tax Example

An SRL with a taxable turnover of 80,000 euros and expenses of 45,000 euros, provided it meets all criteria, pays a micro tax of 800 euros. The tax is calculated on revenue, not on the profit of 35,000 euros. If it has a loss, turnover tax may still be due.

Standard Corporate Tax 16%

A company that does not qualify for the micro-enterprise regime is taxed at 16% on its taxable profit. The rate is confirmed in PwC Romania's 2026 update.

The calculation starts with accounting revenue minus recognized expenses and is adjusted for non-deductible expenses, depreciation, and tax differences. For a business with a low-profit margin, the 16% tax on profits may be more reasonable than 1% on turnover, but the choice is not always freely made.

Corporate Tax Example

With revenue of 150,000 euros and taxable expenses of 100,000 euros, the taxable profit is 50,000 euros. The 16% corporate tax is 8,000 euros. The remaining amount after corporate tax does not automatically pass to the shareholder: a second tax review follows for dividend distribution.

Dividend Tax 16% from 2026

As of January 1, 2026, the Romanian dividend tax increased to 16%. This change affects distributions falling under the new rules and has been confirmed by international tax updates and custodians such as Clearstream.

In the previous example, after corporate tax, 42,000 euros remain. If the entire amount is distributed and a 16% withholding is applied, the dividend tax is 6,720 euros. The total burden of corporate tax and Romanian dividend tax reaches 14,720 euros, before any obligations of the beneficiary in Greece.

The Greece-Romania Double Taxation Avoidance Agreement, parent-subsidiary rules, and the shareholder's tax residency can change the final outcome. It should not be assumed that withholding in Romania automatically exhausts all Greek obligations.

VAT in Romania in 2026

The standard VAT rate is 21%, and the basic reduced rate is 11% for categories defined by law. The national threshold for the small business exemption scheme is RON 395,000 annually, according to the European Commission.

The threshold does not mean that every company below it ignores VAT. Intra-community acquisitions, services to or from other countries, B2C electronic services, and distance sales have separate rules. An SRL may need a special VAT number or OSS registration before reaching the national threshold.

Employee, Salary, and Social Security Contributions

The employee is often critical for the 1% regime. From the gross salary, 25% is usually withheld for pension and 10% for health, while a 10% income tax is also calculated on the relevant base. The usual employer's labor contribution is 2.25% of the gross salary.

The perception that the employer only pays 2.25% is incomplete: the company must fund the entire gross salary and correctly remit the withholdings. The legal minimum wage and special exemptions change, so the annual budget must be calculated with a local payroll provider.

Accounting, Electronic Invoices, and Annual Obligations

Every active SRL requires double-entry bookkeeping. The accountant records invoices, banks, fixed assets, payroll, and tax returns. The company submits annual financial statements even when activity is limited.

• Maintenance of accounting records and supporting documents.
• Electronic invoicing RO e-Factura where applicable.
• Periodic tax, VAT, and payroll declarations.
• Annual financial statements and corporate resolutions.
• Updating beneficial owner information when details change.
• Review of related party transactions and transfer pricing documentation.

Is a mandatory audit required?

A small, unlisted SRL typically does not require a full mandatory audit. The audit is linked to criteria such as size, assets, turnover, employees, and the specific status of the business. Since the thresholds and categorization have been updated, the accountant must review each fiscal year separately.

Tax Residency and Place of Effective Management from Greece

Registration in Bucharest is not enough to eliminate Greek obligations. If all decisions are made in Greece, the manager permanently works from here, contracts are signed here, and there is no substantial presence in Romania, the place of effective management or permanent establishment may be questioned.

The entrepreneur must consider where they are tax resident, where the work is performed, where the management is located, and what substance the company has in Romania. The same issue generally exists in company formation abroad: the incorporation document is only the beginning, not the entire tax planning.

Advantages and Disadvantages

Advantages

• Company within the European Union with the ability to conduct intra-community transactions.
• Limited liability when operating correctly.
• 1% regime for eligible small businesses.
• Large local market and access to skilled personnel.
• Relatively competitive operating costs compared to several Western European countries.

Disadvantages

• Mandatory local accounting and frequent declarations.
• The 1% tax requires conditions and an employee; it is not guaranteed.
• 16% dividend tax, significantly increased in 2026.
• Frequent changes in tax legislation.
• Risk of double obligations when the place of effective management is in Greece.

Romania, Bulgaria, or a US Company?

Romania is suitable when there is a real business reason: local clients, staff, warehouse, establishment, or a need for an EU presence. For a neighboring European option, our guide on company formation in Bulgaria analyzes a different tax and operational model.

For online services to international clients without the need for a European establishment, a US LLC is also worth comparing. It's not a solution for every case, but it can have simpler annual operations when the activity and tax residency allow. The critical thing is to compare total costs, dividend taxes, mandatory personnel, and real substance, not just a nominal rate.

Who is a company in Romania suitable for?

• Businesses seeking sales or establishment in the Romanian market.
• E-commerce with a warehouse, logistics, or local team in Romania.
• Technology companies hiring staff in the country.
• Manufacturing or commercial activities with real local expenses.
• Investors needing a European subsidiary with substantial presence.

It's not ideal just because someone saw the phrase "1% tax." If you don't need employees, if you manage exclusively from Greece, or if you plan to distribute all profits immediately, the actual benefit might be much smaller.

Common mistakes before formation

1. Calculating only the 1%: payroll, accountant, dividends, and VAT are ignored.
2. Fictitious registered office without substance: creates banking and tax problems.
3. Wrong CAEN code: may require changes or permits before invoicing.
4. Personal payments from a company account: destroy financial separation.
5. Ignoring Greece: personal tax residency remains crucial.
6. Outdated information: the micro-enterprise threshold, VAT, and dividends have changed.

Conclusion: Is forming a company in Romania worthwhile?

Romania remains an interesting jurisdiction for businesses with a real presence in the EU. An SRL offers limited liability, and the 1% turnover tax can be competitive for companies up to 100,000 euros that meet all criteria. On the other hand, the 16% dividend tax, employee costs, accounting, and the risk of actual management from Greece significantly alter the final bill.

Before choosing a country, compare your own model with real numbers. For a personalized assessment, you can book a Google Meet with our team. We will examine your activity, clients, place of work, and expected turnover before recommending a structure.

Frequently Asked Questions

How much does it cost to form a company in Romania?

A simple foreign file often costs approximately 800 to 1,500 euros with professional support, translations, and basic preparation. The registered office, capital, bank, and special permits can increase the amount.

Is the corporate tax in Romania 1%?

Only for eligible micro-enterprises with a turnover up to 100,000 euros that meet all conditions, such as the employee requirement. Otherwise, a 16% corporate tax on taxable profits applies.

Is a Romanian director required?

Not as a general rule. A Greek national can be a shareholder and administrator. However, a declared registered office, local accounting, and proper tax organization are needed.

How much is the dividend tax in 2026?

The internal Romanian rate is 16% from January 1, 2026. The final treatment for a Greek resident also depends on the double taxation avoidance treaty and Greek legislation.

Does an SRL need an employee?

The existence of at least one employee or eligible equivalent relationship is a basic prerequisite for the 1% micro-enterprise regime. An SRL can exist without an employee, but then it usually does not qualify for the 1% turnover tax.

When is VAT required?

The national exemption threshold for small businesses is 395,000 RON. Intra-community transactions, imports, and digital services may create an obligation earlier or require special registration and OSS.

Can I manage the Romanian company from Greece?

You can practically participate in management, but exclusive actual management from Greece can create Greek tax residency or a permanent establishment for the company. This needs to be checked before formation.

If you are considering other options outside Greece, see our guide for company formation abroad and our page for company formation in Dubai.