What are the benefits of registering a company in Romania in 2020?

What are the benefits of registering a company in Romania in 2020?

Romania is located in south-eastern Europe. The country borders with Ukraine, Moldova, Bulgaria, Serbia and Hungary. The Romanian is recognized as the official language. Compared to other EU member states, the country has a low level of economy.

At the same time, the company registration in Romania in 2020 is quite profitable, as the country is developing and has moved away from a poor period in economic perspective. Among the jurisdictions of the European Union, it ranks 11th in terms of GDP. To develop business in Romania, please contact our experts at IT-OFFSHORE.

Features of the opening

According to the country's legislation, there are legal forms in which it is possible to open a firm in Romania. Most often, companies are registered in the SRL or SA form. These legal forms are considered the most interesting to invest in.

The company is considered a separate legal entity. The founders have limited liability, which is amount of the share capital. A person, both physical and legal, can become an SRL company founder. The number of participants is limited and must not exceed 50. A resident or non-resident may become a founder.

The appointment of directors may be conducted by the participants. There are no requirements for residence in Romania. There are, however, conditions regarding the minimum share capital - its size must exceed 50 euros.

There are requirements for a legal address. According to the laws of Romania, every company must have one. The information about the address is considered to be reliable after the lease agreement has been concluded. Financial reports must be submitted every quarter. The documents must include information about the expenses of the legal entity, assets and liabilities. It is allowed to create an account for a legal entity in a foreign financial institution.

Pluses of registration

A firm in Romania is considered a profitable alternative to offshore locations. Investors from abroad can receive benefits from the state. It is possible to get profitable loans, tax benefits, and access to public utilities. Investors who start businesses in areas that are not favorable are most likely to get benefits.

The main advantages of starting a company in Romania are the following:

  • Corporate tax can be equal to 1%;
  • Jurisdiction is respectable;
  • The country is not on the blacklist of offshore zones;
  • It is possible to open a firm promptly;
  • Insignificant requirements to the size of the authorized capital;
  • It is possible to open an  account with local and foreign financial institutions;
  • The country has treaties with many nations on avoidance of double taxation.

The country has no difficulty in recruiting highly qualified and well-educated workers. It is possible to obtain quality financial services from the country's banks.

Taxation and reporting

The financial statements of the legal entity in the country are regulated by the standards of the European Union and correspond to the norms of international expectations. Usually, companies have the right to submit simplified financial statements, but in some cases, a full report is required - with a large number of employees, high sales level and balance sheet. An audit must be conducted in accordance with current requirements.

The profit tax for a firm in the country is 16%, except for small companies, which are subject to a 3% rate. The value-added tax is 24%, but there are benefits for some areas of work, that reduce the fee to 5% or 9%. The fixed income tax rate is 16%.

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