How to register a company in Romania? Is it worth doing?

Since joining the European Union in 2007, Romania has become an attractive destination for business, thanks to its dynamic economic growth and favorable tax environment. The country’s Gross Domestic Product (GDP) has undergone significant changes over the years, presenting both opportunities and challenges for entrepreneurs looking to establish a business in Romania.

Development of the Romanian economy

Romania’s economy has experienced strong growth in recent years, although some recent slowdowns have been noted. In 2003, the GDP stood at approximately USD 76 billion. By 2010, it had surged to USD 213 billion, and as of recent estimates, it has reached around USD 239 billion. In 2024, Romania’s Gross Domestic Product (GDP) was approximately $830.5 billion in nominal terms, with a GDP per capita of $44,484. However, in 2024, the economy saw a modest GDP growth of only 1.2%, impacted by external economic conditions and internal fiscal challenges.

Why Open a Business in Romania?

Entrepreneurs may find several compelling reasons to establish a business in Romania:

• Population: As of 2024, Romania’s population is approximately 19,064,409 people.
• Developing B2B market: Including all forms of legal organizations, such as authorized natural persons (PFA), individual enterprises (II), and family enterprises (IF), Romania has over 1.67 million active business entities.
• Strategic Location: Romania’s geographical position offers access to both EU and non-EU markets, making it an ideal hub for trade and distribution.
• Competitive Tax Rates: Romania has a standard corporate income tax rate of 16%, which is relatively low compared to other EU countries. Additionally, small businesses (micro-companies) benefit from a 1% tax on revenue for annual incomes up to EUR 30,000, provided they employ at least one person.
• Skilled Workforce: Romania has a quite well-educated labor force, particularly in sectors such as information technology, engineering, and manufacturing.
• Infrastructure Development: The country continues to invest in infrastructure, including transport and digital networks, improving the ease of doing business.

Challenges of opening a business in Romania

While Romania offers many advantages, there are also challenges to consider:

• Bureaucracy: Administrative procedures can still be complex and time-consuming despite improvements in recent years.
• Fiscal Deficit: Romania’s budget deficit reached approximately 8% of GDP in 2024, which may lead to potential tax adjustments or stricter financial policies.
• Infrastructure limitations: While progress has been made, some regions still face infrastructural gaps that can affect logistics and operations.
• Business Mentality and Culture: The business culture in Romania can be different from Western European standards. Some challenges include:
  • A preference for traditional business relationships and personal trust over formal contracts.
  • Homo-sovieticus mentality of Romanian people in general.
  • Resistance to change, making it harder to introduce innovative business models.
  • Bureaucratic inertia that can delay processes even with proper documentation.
• Low-quality services delivered by many local companies.

Updated taxation overview

As of 2025, Romania maintains a standard corporate income tax (CIT) rate of 16%. For micro-companies with annual revenues up to EUR 30,000, a 1% revenue tax applies if they employ at least one person. For annual revenues up to EUR 250,000 the tax rate is 3%. If this employment condition is not met, the standard 16% CIT applies. Dividends are taxed at 10%.

Additionally, recent fiscal policies have eliminated certain tax incentives, particularly in sectors like IT and construction, effective from January 2025. Read more about tax rates in Romania.

VAT in Romania

Romania’s VAT system is relatively simple compared to other European countries. The standard VAT rate is currently 19%, with reduced rates of 9% and 5% applicable to specific goods and services. An entrepreneur is only required to register for VAT once their annual turnover exceeds EUR 88,500. There is no mandatory split payment mechanism unless a business has unpaid tax liabilities.

How to register a company in Romania

Starting a company in Romania involves several steps. The most common business structure is a limited liability company (SRL), which can be established by at least one person or legal entity. Romanian law restricts an SRL to a maximum of 50 shareholders. The minimum share capital required is RON 1, and at least one director must be appointed, though they do not need to be a Romanian resident.

Steps to Register a Company in Romania

1. Name Reservation: Check with the Commercial Registry (onrc.ro) to ensure the company name is available and reserve it for up to three months.
2. Choose a Business Structure: Most businesses register as an SRL, but other options include joint-stock companies (SA), limited partnerships (SCS), and general partnerships (SNC).
3. Prepare Documentation: This includes a deed of incorporation, notarized declarations from partners, identity documents, and relevant legal forms.
4. Open a Bank Account: Deposit the minimum share capital in a corporate bank account and consider banking options suitable for your business.
5. Register with Authorities: Submit documents to the Commercial Registry, obtain a tax identification number (CUI), and complete statistical and social security registrations.
6. Hire Employees: If hiring, register employment contracts with the Labor Office before employees begin work.
7. Tax Registration: File a tax declaration with the Tax Office within the first 30 days of operation and, if applicable, register for VAT.

We have published the list of necessary documents for company formation in Romania, which can help you register a company.

Cost of Registering a Company in Romania

Registering a company in Romania is relatively affordable, with basic registration costs around 600 euro for an SRL. However, additional expenses such as document translation, notary fees, legal consultations, and administrative processing can increase the total cost. The rent of a property eligible for business registration rumps up costs even further. Considering their own time, a Romanian resident may face costs exceeding €1,200 for a fully operational company. For a Romanian non-resident a realistic estimate for full company registration that is ready to operate, including professional services and compliance, can range from EUR 1,900 upwards. Try our convenient service for the formation of a fully operational business in Romania.

Is it worth starting a business in Romania?

Setting up a business in Romania can be a strategic move, particularly for those looking to expand sales to over 20 milion of Romanians, optimize taxes and access a growing market. The combination of still not bad tax rates, skilled labor, and a business-friendly environment makes Romania an appealing destination for entrepreneurs. However, it is crucial to consider the regulatory landscape, potential fiscal changes, and the overall cost of doing business.

If you are considering starting a business in Romania and want to simplify the process, our professional services can ensure a smooth and compliant registration process. Whether for tax optimization or business expansion, Romania remains an attractive option for investment in 2025 and beyond.