Establishing and maintaining a Romania payroll
The Eastern European nation of Romania is a rapidly-growing and dynamic place to build and grow a business. After decades of economic instability, Romania has developed significantly in recent years, experiencing some of the highest economic growth in Europe.
However, to build a business and hire employees in Romania, you will need to establish a Romania payroll and may need to register an official entity. This is a complicated process and requires strict adherence to the country’s unique regulations and application procedures. Because of this, the payroll setup process can take longer than expected and cause delays with expansion efforts, potentially costing your business time and lost revenues.
At Horizons, our experts offer Romania payroll outsourcing to setup and management your international payroll, enabling your organization to start hiring and expand more quickly and efficiently, whether or not you already have an established entity in the country.
If you have an entity in Romania
If you have already registered an entity in Romania, then we can take care of your payroll setup and management, using our expert knowledge of Romania’s regulations to keep you fully compliant.
This service is well-suited to larger organizations and those looking to establish a long-term presence in Romania.
If you don’t have an entity in Romania
If you don’t have a registered entity in Romania, you can use our full payroll outsourcing service. Our Romanian subsidiary will act as employer of record for your employees, and our team will handle the HR, administration, and complex legal compliance work.
Choose this service for a low-risk, flexible, and scalable solution for your Romanian payroll setup and management, with all the benefits of hiring locally and none of the usual complications.
Build your business in Romania with help from Horizons
Romania payroll guide
What withholdings and taxes are required in Romania?
Employees and employers in Romania must both contribute a certain percentage of salaries to various social funds:
- For the Social security fund, employers must contribute 20.8% and employees must contribute between 31.3% and 41.3%.
- For health insurance, employers need to contribute 5.2% and employees must contribute 5.5%.
- For the medical leave/compensation fund, employers contribute 0.85% and employees contribute between 0.15% and 0.85%.
- For the unemployment fund, employers must contribute 0.5% and employees contribute 0.5%.
Entitlements and terminations
For termination of employment contracts, employers in Romania must give at least 20 working days of notice. This period does not apply to employees who are in a probation period, or who have been dismissed with proper cause.
Employers in Romania are not required to pay severance upon termination.
How to establish Romania payroll outsourcing
You may choose to establish an internal payroll in Romania, but this is a time-intensive option that can be very difficult to execute in practice, with language barriers, cultural differences, and frequently changing regulations getting in the way. The simplest option is to outsource your Romania payroll setup and management.
Horizons offers comprehensive payroll setup and management services, helping you get up and running in the country as quickly as possible. We can also offer our Romania subsidiary to act as employer of record, so you can benefit from our services even if you don’t have an entity in the country.