Key takeaways
- Romania has a standard VAT rate of 21% and a reduced rate of 11% (both since August 1, 2025), as well as VAT exemptions.
- Businesses must register for Romanian VAT when their annual sales exceed RON 395,000 or €10,000 in distance sales. Periodic returns are required to be submitted by the 25th of each month.
- Professional advice should be sought to ensure compliance with penalties enforced for non-compliance including late payment fees and misdeclaration penalties.
In short: Romania's standard VAT rate is 21%, with a reduced rate of 11%, plus zero-rated and exempt items. Established businesses must register once turnover passes RON 395,000, while foreign companies have no threshold. Returns and payments are usually due by the 25th of the month after each period.
If your business operates in Romania or plans to expand there, you need to understand its VAT rates, thresholds, and compliance rules. This helps your business run smoothly and avoid penalties. In this post, we explain how the Romanian VAT system works, its rates, and the main compliance requirements.
How does the Romanian VAT system work?
Romania’s VAT system is part of the European Union’s single market. It falls under the EU VAT regime, which means it follows EU directives on VAT principles. The Romanian Ministry of Public Finance and tax authority run the system and make sure businesses follow VAT rules in Romania. Romania introduced VAT in 1993. Since then, businesses in Romania have faced a range of VAT obligations.
The rules for VAT in Romania are set out in the Fiscal Code (Law 227/2015), which contains the Romanian VAT Code, and in European VAT Directives. These also set the VAT registration threshold for businesses.
What are the VAT rates in Romania?
Romania has a standard VAT rate of 21% and a reduced rate of 11%. There are also zero-rated items and exemptions. Read more in our guide: VAT Updates August 2025: Romania Implements Major VAT Rate Changes.
Standard rate
The standard VAT rate in Romania is 21%. It applies to most goods and services that don’t qualify for an exemption or a reduced rate. Romania raised it from 19% on August 1, 2025. You can also read VAT & Sales Tax Updates: September 2025.
Reduced rate
Since August 1, 2025, Romania has one reduced VAT rate of 11%. It replaced the earlier 9% and 5% rates. The 11% rate applies to a range of goods and services, including:
- Food
- Medicines
- Water supply
- Hotel accommodation
- Restaurant and catering services
- Books
- Fertilizers
Zero-rated items and exemptions
As well as standard and reduced rates, there is a zero rate. Zero-rated items include intra-community supplies and international passenger transport. Some goods and services in Romania are also exempt from VAT. Examples include medical services, educational services, and certain financial services. For a closer look, see Malta VAT Rates and Compliance Explained.
It's important for taxable persons to know the difference between zero-rated items and exemptions. Traders can claim a refund for any VAT paid on inputs linked to zero-rated items. This is not possible for exemptions. Knowing these differences can help you manage VAT better and keep your tax bill low.
What are the VAT registration requirements?
The threshold for VAT registration in Romania is RON 395,000 in annual turnover for established entities. It was raised from RON 300,000 on September 1, 2025. There is no threshold for foreign companies. So if a foreign company makes any taxable supplies in Romania, it must register for VAT right away. If you distance sell into Romania, you must register for VAT once your annual turnover goes over €10,000.
Registering for VAT in Romania is fairly simple. You can do it through the National Agency for Fiscal Administration (ANAF). Companies based outside the EU must appoint a fiscal representative to act for them.
What are the VAT compliance and reporting obligations?
Romanian VAT compliance and reporting obligations include periodic VAT returns, intra-community reports, and electronic invoicing. All of these help businesses keep their VAT records clear and accurate.
Periodic VAT returns
All businesses registered for VAT in Romania must file periodic VAT returns, whether they are resident or not. You file these returns using Form 300, or the 'Value Added Tax Return'. They list the transactions your company made in Romania, based on your VAT sales and purchase ledgers. You must submit them to the relevant tax authority for each tax period.
VAT returns and payments are calculated and paid monthly or quarterly, depending on your business's turnover. The deadline to file VAT returns and pay any VAT due is usually the 25th of the month after the reporting period. All VAT due must be paid in Romanian currency (RON).
Intra-community reports
As well as periodic VAT returns, businesses in Romania must also file intra-community reports, such as the EC Sales List (ESL). The EC Sales List is a monthly statement. You must submit it to the relevant tax authority by the 25th of the month after the month of the transactions. This report is essential if your business makes intra-community supplies and acquisitions of goods and services.
You need to file an Intrastat declaration if you are registered for VAT in Romania and meet a threshold. This applies when your intra-community supplies or acquisitions of goods are over RON 1 million a year in either arrivals or dispatches. The deadline for the Intrastat report is within 15 days after the end of the month the transactions relate to.
Electronic invoicing
Romania first made e-invoicing mandatory on July 1, 2022, for high fiscal risk products. These include alcoholic drinks, tobacco, and luxury items.
Since January 1, 2024, B2B invoices between Romanian-established businesses must also go through the national e-Factura system. The aim is to improve transparency and compliance in how these products are taxed, and to reduce the VAT gap. The National Agency of Fiscal Administration (ANAF) handles taxation and financial management in Romania. It is also responsible for e-invoicing in the country.
Romania also requires SAF-T reporting (form D406). It was phased in from 2022, and since 2025 it also applies to small businesses and non-residents. SAF-T is a standard electronic format for sharing accounting data between taxpayers and tax authorities. It makes tax audits simpler and reduces the VAT gap. It also standardizes how tax authorities and taxpayers share information, which benefits both sides.
How does VAT recovery work?
In principle, non-resident companies in Romania can reclaim all or part of the VAT they pay on their expenses. To do this, they must submit a refund request electronically in their own Member State of establishment. That state then forwards the request to the Romanian tax authorities through its electronic portal. A taxable person not established in Romania may be able to claim back the VAT on imports and purchases of goods/services made in the country.
Companies established in Romania can only recover input VAT on Romanian purchases through their Romanian VAT returns. Understanding how VAT recovery works helps you reduce your tax bill and comply with Romanian VAT rules.
What are the penalties for non-compliance?
The Romanian Tax Authority charges penalties for filing VAT returns late and for late payments. If you don't file a VAT return on time, the fine is between RON 1,000 and RON 5,000. If you pay VAT late, you'll pay daily interest of 0.02% plus an extra daily fine of 0.01%.
To avoid these penalties, keep up with VAT deadlines. Make sure your VAT returns and payments are accurate and on time. Good VAT management processes and professional advice can help you stay compliant and lower the risk of penalties.
Conclusion
Like every VAT system, VAT in Romania has its own rules that can be hard to get your head around. If you do business in Romania, you need to understand the different VAT rates, meet all filing requirements, and stay on top of compliance. Non-compliance can lead to financial penalties. It can also damage your company's reputation.
With the right guidance and a proactive approach, Romanian VAT can be straightforward. This helps your business run smoothly in this vibrant EU member state.
Do you need help with your VAT compliance? Book a free call with one of our VAT experts to find bespoke solutions for your business, optimize your VAT costs, and reach millions of new potential customers.
How Taxually handles this
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Frequently asked questions
What is the standard VAT rate in Romania?
Romania has a standard VAT rate of 21%, which applies to the majority of goods and services.
Are there reduced VAT rates in Romania?
Romania has a reduced VAT rate of 11%. It applies to certain goods and services such as food products, water supplies, hotel accommodation, cultural and sporting events, books, and medicines.
Who is required to register for VAT in Romania?
Companies or individuals that supply taxable goods or services in Romania and exceed a certain annual turnover threshold are required to register for VAT.
How do I register for VAT in Romania?
Businesses can register for VAT in Romania by submitting the necessary documents and forms to the National Agency for Fiscal Administration (ANAF).
