Setting Up an IT Company in Romania: Registration and Payroll 2026

Romania has emerged as one of Europe's most attractive destinations for IT companies and software development outsourcing. With a highly skilled workforce, competitive costs, and significant tax incentives, the country offers a compelling business case for foreign investors in the technology sector.

This guide covers everything you need to know about establishing an IT operation in Romania in 2026.

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Why Romania for IT? Key Advantages

Payroll taxation

The former IT salary income-tax exemption was abolished from January 2025 by OUG 156/2024. The conditional R&D salary income-tax exemption under Fiscal Code article 60 point 3 remains distinct.

2. Competitive Developer Salaries

Average monthly gross salaries for developers in Romania (2026):

These rates are 40-60% lower than Western European equivalents while maintaining comparable quality standards.

3. EU Membership & Legal Framework

As an EU member state, Romania provides:

• Access to the EU Single Market
• GDPR compliance framework already in place
• Double Taxation Agreements (DTAs) with 90+ countries
• Stable legal environment based on Civil Law tradition

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Step-by-Step: Registering an IT Company

Step 1: Choose Your Legal Structure

Recommendation: Most foreign IT companies choose SRL due to minimal capital requirements and operational flexibility.

Step 2: Register with the Trade Registry

Required documents:

Timeline: 3-5 business days for standard registration.

Step 3: Register for VAT (if applicable)

• Mandatory if annual turnover exceeds 395,000 lei (2026 threshold)
• Optional registration available from day one
• Reverse charge mechanism applies for B2B services within the EU

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Fiscal Framework for IT Companies

Corporate Tax Options

Option A: Standard Corporate Tax

• 16% flat corporate tax on profits
• 16% dividend withholding tax (reduced under DTAs)
• Best for companies with high revenues and significant expenses

Option B: Micro-Enterprise Regime

• 1% tax on revenue (requires at least 1 employee)
• Available for companies with revenue under €100,000/year

Social Contributions (2026)

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Hiring IT Talent in Romania

Major Tech Hubs

Employment Law Essentials

• Standard work week: 40 hours (8 hours/day)
• Minimum annual leave: 20 working days
• Probation period: Up to 90 calendar days (120 for management)
• Remote work: Legally regulated under Law 81/2018 (Telework Law)
• Notice period: Minimum 20 working days for resignation

Intellectual Property Protection

All IP created by employees during work hours belongs to the employer by default under Romanian law. However, we strongly recommend:

• Including explicit IP assignment clauses in employment contracts
• Registering trademarks with OSIM (Romanian Patent Office)
• Filing patents through the European Patent Office for EU-wide protection

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Practical Checklist for Foreign IT Investors

✅ Choose legal structure (SRL recommended) ✅ Engage a Romanian law firm for registration ✅ Open a corporate bank account (Banca Transilvania, ING, Raiffeisen)

✅ Set up payroll and employment contracts ✅ Register for VAT if applicable ✅ Implement GDPR compliance procedures ✅ Consider the micro-enterprise regime for the first years ✅ Establish IP protection policies

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📖 Recommended reading: Intellectual Property in Romania 2026: Trademark, Patent & Copyright Protection Guide

📖 Recommended reading: Corporate Governance in Romania: Board Requirements and Compliance Overview for Foreign Investors

📖 Recommended reading: Shareholders' Agreements in Romania: Key Clauses & Investor Protection

📖 Recommended reading: Shareholders' Agreements in Romania: Key Clauses & Investor Protection

📖 Recommended reading: Corporate Restructuring in Romania: Legal Options for Foreign Investors (2026)

📖 Recommended reading: Startup Term Sheet Negotiation in Romania: Key Investor Protections

📖 Recommended reading: Holding Company in Romania 2026: Structure, Tax Benefits & Setup Guide

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Frequently Asked Questions

How long does it take to register an IT company in Romania?

Standard registration takes 3-5 business days. With a local law firm handling the process, you can have a fully operational company within 2 weeks, including bank account opening and tax registrations.

Can I run the company remotely from abroad?

Yes. Romanian law allows foreign administrators. You can manage the company remotely, though you'll need a local registered office address and may benefit from a local accountant and legal representative.

What is the effective tax rate for an IT company in Romania?

Do I need to speak Romanian to do business?

No. Business can be conducted in English, and all legal documents can be translated. However, official filings with ANAF and the Trade Registry require Romanian-language documents.

Is Romania safe for intellectual property?

Yes. Romania is a signatory to all major IP treaties (WIPO, Paris Convention, Madrid Protocol) and enforces EU-level IP protection standards.

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Need Legal Assistance?

The firm at Pantilimon Avocat specializes in helping foreign IT companies establish operations in Romania. We provide end-to-end support including company registration, tax optimization, employment contracts, and ongoing legal advisory.

📧 Contact us for a consultation.

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This article is for informational purposes only and does not constitute legal advice. For specific situations, please consult a specialized lawyer.