Romanian contractors work through one of two set-ups: the PFA, an individual registered as a sole trader, and the one-person SRL on the 1% micro-enterprise tax. Both invoice a foreign client gross and handle their own tax. The client’s exposure sits in one place: the Fiscal Code’s four-of-seven independence test, which ANAF can use to requalify a PFA as an employee.
PFA or micro-enterprise SRL
A PFA (persoană fizică autorizată) is an individual trading under a sole-trader registration under GEO 44/2008; any economic activity carried on permanently, occasionally or temporarily must be registered and authorised (ANAF, checked 2026-09-29). It is cheap to run and taxed on net income.
An SRL is a limited-liability company. Under the micro-enterprise regime it pays 1% of revenue, provided revenue stays within the RON equivalent of €100,000, the company has at least one employee, and shareholders holding more than 25% use the regime in only one company. The ceiling was €250,000 in 2025, and a micro-SRL that exceeds it during the year owes the standard 16% profit tax from that quarter (PwC Tax Summaries, reviewed 2026-09-25). Profits taken out as dividends are taxed at 16% from 2026, up from 10% (EY, checked 2026-09-29).
For you, a PFA is an individual counterparty and an SRL is a company. The employee requirement and the €100,000 ceiling mean a well-paid solo contractor often cannot use the micro-enterprise regime.
Income tax, CAS and CASS for a PFA
| Item | Rate | Base in 2026 |
|---|---|---|
| Income tax | 10% | Annual net income; paid by 25 May of the following year |
| CAS (pension) | 25% | 12 minimum wages (RON 48,600) if net income is 12–24 minimum wages; 24 minimum wages (RON 97,200) at 24 or more |
| CASS (health) | 10% | Net income, capped at 72 minimum wages (RON 291,600) |
Sources: income tax and deadline from ANAF; CAS and CASS from PwC Tax Summaries, reviewed 2026-09-25, whose 2026 figures use a monthly minimum wage of RON 4,050. The CASS cap rose from 60 to 72 minimum wages for 2026 under Law 141/2025 (ContApp, checked 2026-09-29).
All of this is the contractor’s to file in the Declarația unică. A foreign client withholds nothing.
VAT. A PFA or SRL charges no Romanian VAT on B2B services to a client abroad. For an EU client it needs an intra-EU VAT code before the first invoice and writes “taxare inversă” (reverse charge) on it; for a client outside the EU the service is not taxable in Romania (regnet.ro, 12 June 2026, checked 2026-09-29). The small-business VAT threshold is RON 395,000 from 1 September 2025 (NNDKP, checked 2026-09-29). Invoices to EU business clients with a valid VIES number and to non-EU clients are outside RO e-Factura reporting (regnet.ro, checked 2026-09-29).
The dependent-activity test in the Fiscal Code
Art. 7 point 3 of the Fiscal Code defines an independent activity as one that meets at least four of seven criteria (ANAF, checked 2026-09-29):
- Freedom to choose the place and manner of work and the working schedule.
- Freedom to work for several clients.
- The person bears the risks of the activity.
- The work uses the person’s own assets.
- The work uses the person’s intellectual capacity and/or physical effort.
- Membership of a professional body that represents, regulates and supervises the profession.
- Freedom to work directly, with employees or through collaboration with third parties.
Criterion 5 is met by almost everyone and criterion 6 by almost no software contractor, so the test is decided on the other five. A PFA on your hours, on your laptop, barred from other clients, fails criteria 1, 2 and 4 at once, and often 3 as well.
The Fiscal Code’s economic-substance rule (Art. 11) lets ANAF recharacterise a transaction to match its economic content. On requalification, income tax and employee and employer contributions are recalculated, with interest and penalties, for up to five years (juridice.ro, checked 2026-09-29). Keep engagements scoped to deliverables, let the contractor set hours and tools, and do not prohibit other clients.
Contract and IP
- A written services agreement with the PFA or SRL: deliverables, rate, currency and payment terms. A PFA can invoice in any currency and records the income in RON at the National Bank of Romania rate on the day it is received (regnet.ro, checked 2026-09-29), so state who carries exchange differences.
- IP assignment in writing. Under Law 8/1996 the existence and content of an assignment of economic rights can be proven only in writing (Wolters Kluwer, checked 2026-09-29). The rule that gives employers the rights to software written by employees (Art. 75) does not reach contractors (juridice.ro, 10 March 2026, checked 2026-09-29). Assign economic rights explicitly.
- Independence markers: the contractor’s own equipment and schedule, the right to serve other clients, and freedom to subcontract.
On your side, pay gross against invoices; there is no Romanian withholding for a foreign client. US payers collect a W-8BEN (W-8BEN-E from an SRL) and file no 1099. EU payers check the contractor’s RO VAT code in VIES.
How to pay contractors in Romania
| Method | What the contractor sees | Notes |
|---|---|---|
| SEPA transfer (EUR) | EUR on a EUR IBAN | Romania is in SEPA; no conversion if you hold EUR |
| Local RON payout | RON on a Romanian IBAN | Through a provider with a local account, such as Wise |
| SWIFT wire | USD or another currency, often converted by the receiving bank | Least predictable amount on arrival |
Rails, costs, documents and a comparison of platforms are on our page on how to pay contractors in Romania.
Contractor of Record in Romania
Because the four-of-seven test turns on how the work is actually done, a Contractor of Record is most useful for full-time PFAs working for a single client. 4dev acts as Contractor of Record — the contracting party for each contractor — which reduces reclassification risk. Other providers sell Contractor of Record products as well; read the liability clause in the contract, not the product name. Where the relationship is really employment, use an Employer of Record instead. Compare providers in our COR rating.