Cost of Living

Yes — this is what makes it unusual and potentially very valuable. A Romanian SRL Micro pays 1% of total gross revenue up to €100,000/year (2026 threshold), regardless of expenses or profit margin. For a consulting or software business with very low overhead costs (i.e., high margins), this results in an extremely low effective tax rate. However, the 16% dividend tax in 2026 means extraction costs are higher than before.

Three significant changes from 2026: (1) Revenue threshold halved from €250k to €100k — businesses above €100k gross revenue now pay 16% CIT instead of 1%; (2) Dividend tax raised from 10% to 16%; (3) The 20% consulting restriction was removed (positive). For businesses under €100k revenue, the combination is still excellent. For those above €100k, the jump to 16% CIT makes Romania less distinctively competitive versus Bulgaria (10% CIT + 5% dividend).

For income under €100,000/year: SRL Micro at 1% of revenue is typically better than PFA at 10% of profit. For very low income (under ~€20,000/year): PFA is simpler and cheaper to maintain. For income over €100,000/year: regular SRL at 16% CIT vs PFA at 10% of profit — depends on margin structure. Consult a Romanian accountant for your specific situation.

From the date your Romanian residence permit is issued, you are exempt from Romanian income tax and social contributions for 6 months. This means even if you're earning well above the income threshold, you pay zero Romanian tax during this initial period. After 183 days of physical presence in Romania in any 12-month period, you become tax resident and standard Romanian taxation applies.