New Year brings clear procedures on tax residency sourcing rules for foreigners in Romania

Recently passed legislation provides clear sourcing rules based on which foreign individuals tax residence is established on arrival and departure in and from Romania. All foreign individuals arriving in Romania and staying for a period exceeding 183 days within 12 consecutive months, ending in a calendar year are required to fill in a "Questionnaire to determine the individual's tax residence upon arrival in Romania".

The return must be filled and submitted to the tax office in whose jurisdiction the individual is domiciled either directly or through proxy.

In sourcing tax residency, according to the tax treaties, the following criteria, listed in order of importance, will be considered by the tax office:

a) Domicile
b) Center of vital interests
c) State in which he frequently lives
d) Citizenship
e) Amiable settlement between source and residence jurisdiction

Foreigners failing to proof tax residency of a country with whom Romania entered into a double tax treaty with or showing tax residency in a "no treaty country" and staying in Romania more than 183 days within 12 consecutive months are deemed tax resident in Romania and will be subject to income tax on incomes from any source both Romania and outside Romania, as of January 1st of the following year in which they become tax residents.

The law requires the obligation to register with the tax office within 30 days from the expiry of 183 days of presence in Romania.

Part of the file submitted alongside the questionnaire include passport, tax residency certificate released by the treaty country, if applicable, and realty ownership, if applicable.

Within 30 days from submission of the file, the tax office notifies the applicant if Romanian tax residency has been acquired and Romania gets taxation right on its worldwide income or Romanian tax residency has not been acquired in which case only Romanian source income is taxed.

Within 30 days prior to departure from Romania, foreigners need to resubmit the questionnaire based on which Tax office will assess if Romanian tax residence is retained or not.

Nevertheless, individuals who have arrived in Romania before 1st of January 2009 and continue to be present in Romania after January 1st, 2012 have the obligation to fill in the form "Questionnaire to determine the tax residence of the individual arrival in Romania".

Marinela Badita
Mirus Consultanta Fiscala, Bucharest, Romania, W:, E: This email address is being protected from spambots. You need JavaScript enabled to view it.

Ggi Logo 150x109px

GGI Global Alliance AG

Sihlbruggstrasse 140
6340 Baar


T: +41 41 7252500
F: +41 41 7252501
This email address is being protected from spambots. You need JavaScript enabled to view it.