Would you like to register as a sole trader (PFA) in Romania? It is recommended to explore the imposed tax system. Read this article for information about the key taxes to be paid by sole proprietorships in Romania, and also contact our local accountants for in-depth advice and services.
Table of Contents
What is a sole trader in Romania, and how is it known?
A sole trader in Romania is known as a PFA (Persoana Fizica Autorizata) and does business under their own name.
What are the key taxes paid by a PFA in Romania?
- Income tax,
- CAS,
- CASS,
- VAT in certain cases.
NOTE! Taxation is imposed annually when the threshold is reached.
What is the income tax rate for sole traders in Romania?
10% imposed on taxable income after business deductions.
What is CASS for sole traders in Romania?
CASS is the health contribution paid by a sole trader in Romania. This is how it is calculated:
- 10% x 6 minimum salaries if the net income ranges between 6 and 12 minimum gross wages,
- 10% x 12 minimum wages if the net income ranges between 12 and 24 minimum gross salaries,
- for minimum gross salaries of up to 90, the CASS is calculated on the upper limit.
What is the pension contribution (CAS) for a sole trader in Romania?
25% flat rate for net income exceeding 12 minimum gross salaries/year.
Are sole traders in Romania required to register for VAT?
Yes, if reaching a specific turnover. Otherwise, the registration is optional.
What is the fixed income norm for sole traders in Romania?
PFAs in Romania can be taxed under a fixed-income norm if certain activities are developed. As such, the tax is calculated based on the official income norm for the sole trader in question.
What are the accounting requirements for sole traders in Romania?
- record all income,
- keep invoices and other documentation,
- track all expenses, etc.
NOTE: Our accountants in Romania use specific digital platforms to register all information for sole traders (among our clients). This is important for proper tracking of all financial transactions and reporting to the relevant authorities.
What is the tax declaration form for sole traders in Romania?
Form D 212.
When is the tax filing deadline for sole traders in Romania?
25 May for the previous business year.
Are there any precautions sole traders in Romania should take?
- starting in 2026, sole traders in Romania must eliminate cashless payments and operate exclusively with local banks for all financial transactions,
- there is also the e-invoicing compliance to consider as a sole proprietorship in Romania by using the available and official digital system,
- EUR 60,000 is the VAT registration threshold in Romania, also imposed for sole traders who reach this ceiling,
- if you hire employees, make sure you understand payroll and employer tax obligations.
Would you like to know more about the taxation of sole proprietorships in Romania? Start a collaboration with our Romanian accountants by contacting us today.