How To Register A Micro Company In Romania
From Registration To Real Office Hiring

Romania is often mentioned on the lists for offshore companies and entrepreneurs, but most people have no clue what to expect. Located in Eastern Europe by the Black Sea, Romania is a middle-sized country that feels like it was forgotten somewhere in time. From a business point of view, it is a little piece of heaven.

Basically, you can go up in the mountains and find villages that have not changed over the past 100 years. As you hang around big cities, they feel like they remained somewhere in the Soviet era, a couple of decades ago. Sure, you can spot some modern upgrades here and there – such as glass buildings, but the overall aroma of this place is definitely old-fashioned.

When it comes to business, you need to play your cards right. Wages are incredibly low when compared to western countries in the EU. Romania can be an excellent place to start a business, and you may end up paying as little as 1% in tax. But on the same note, bureaucracy can also be a killer, and taxes may easily reach 20% if you have no clue how to do things right.

From many points of view, Romania is a complicated territory even for a Romanian. Unless you have actually studied economics and finances in Romania, chances are no one knows which way to go. You need a specialized office or professional to handle all the paperwork for you, and the good news is you can get things done without even being there.

What makes Romania good for business​

Romania is far from being a perfect country. Development is relatively low. While things are moving forward, everything is extremely slow. Roads are not too good, and corruption is still a major issue in the country. Most residents have little to no confidence in local politicians or the actual system due to the bureaucracy. There are a few cities worth some attention for foreigners:

-Bucharest – the capital and largest city in Romania.
-Cluj-Napoca – located in Transylvania and one of the strongest economical centers in the country.
-Brasov, Timisoara, Craiova, Constanta, and Iasi – among the biggest cities in the country.

Bucharest lacks the beauty of other Eastern capitals, such as Budapest or Belgrade. Cluj-Napoca seems to be more civilized, while other cities are quite large by Romanian standards, yet not massive – anywhere between 200.000 and 300.000 people on average. Now, why would you want to do business in this country?

First of all, there is an incredible sense of freedom in Romania. The country was under communists until 1989, so everyone enjoys freedom today. Laws are made to be broken – Romania is the perfect example. The country has just banned smoking in indoor public places after a fire in a club that killed dozens, just to give you an example of what you can do in there.

Furthermore, you will love the Internet. No matter how much you pay for your Internet at home, it is only a fraction of what you can get in Romania. For less than €6, you can get a decent optic fiber connection that feels like the 5G connection in big western cities. In fact, Romania has some of the fastest Internet speeds in Europe and is around the top 25 in the world – no restrictions or censorship either.

Now, if you truly want to develop a company in Romania and not just run your money through a Romanian company, the workforce is well prepared and qualitative at an affordable rate. Virtual assistants, workers, web developers – you name it. Romania has well-educated people, and most of them speak good English. People go to school in big cities and pursue higher education.

Finally, Romania is part of the European Union. It could be a benefit, but it may be a disadvantage as well. To many, the EU means more paperwork, extra bureaucracy, and taxes. But then, it is also an advantage. There are plenty of loopholes to pay super low taxes and prove that you actually do it – excellent to stay out of trouble.


How to pay low tax in Romania​

You need to get your facts straight if you want to pay 1% in tax or similar numbers. Otherwise, you will get burned. Keep in mind that there are more types of companies you can register in Romania, and some of them will come with high taxes. The general idea is to come up with a micro company – this is the catch. It is a challenge to know everything about it, but it is worth your time.

The concept of a micro company has been in constant updates since 2015. Every new year brings in new laws and regulations. For a foreigner, keeping up with all the little changes is a challenge. So, what is a micro company, and what do you need to run one today? As a general rule of thumb, the micro company is an entity that meets a few conditions by the end of the fiscal year – 31st of December:

  1. -The income is less than €1M.
  2. -The social capital is owned by people and not by the state or administrative entities.
  3. -It is not in administration or other similar issues.

Now, what do you need to know about taxes? Romania is among the countries with the most taxes in the world. Believe it or not, there are cities in Romania where people pay tax when it rains. The more it rains, the more tax they pay. But back to offshore issues, here is what you need to know about the taxes you must pay:

  1. -1% if your micro company has one or more employees.
  2. -3% if your micro company does not have any employees.

If the number of employees changes, the tax will change accordingly in three four-month increments – it depends on when the change took place. Those who hire someone with the one and only purpose to reduce tax should know that the employment contract is over at least 12 months – you can also hire someone for an undetermined period of time, but it must exceed 12 months.

The best places to run your money through Romania​

Now, it depends on why you want a company in Romania. Are you interested in doing proper business there? Are you about to move there? Do you want to go there every now and then? If this is the case, you want a civilized place with well-educated people. You do not want to be in a village that implies cutting your own wood to warm up in the wintertime, when temperatures can go down to -20 degrees Celsius.

Therefore, your options involve big cities. Some of them are better than others. Bucharest is the capital and has lots of opportunities. Cluj-Napoca is quite close in terms of economics, but slightly smaller and more civilized – people are nicer, the city is cleaner, and there are little to no rough neighborhoods. Bucharest has a few neighborhoods that can compete against the most dangerous neighborhoods in the world.

Brasov is another good option. Quite decent economically, the city is about to open up its airport – nearly done, but bureaucracy will most likely delay it. It is probably the most touristic big city in Romania, and it gathers together foreigners from all over the world. Other big cities are similar to Bucharest, but proportionally smaller – Iasi, Timisoara, Constanta or Craiova.

Now, if you are only interested in running your money through Romania to benefit from the low tax system, things might be better – but they are not. You only need a micro company, then. You do not want a fancy office in a big city. You could do with a tiny house in a time-forgotten village. Financially, it is much better.

Instead of paying €500 a month for a small office in Bucharest, you might as well pay €50 a month for a house in the middle of nowhere. It is not like you are going to live there or run a business from that office. You are less likely to find services for offshore entrepreneurs in such villages, though. You might imagine that someone working from a city may have access to such properties too.

Here comes the catch. Romania is in Eastern Europe, and Eastern Europe has a pretty bad reputation when it comes to foreigners. Countries that are still developing tend to provide low wages compared to the west. Therefore, if you travel to Romania, you better get ready to be ripped by taxi drivers, for example. If you want to hire an office, you will find one in posh areas, rather than the cheap ones.

You are a foreigner – you are a source of money and commissions for every worker. Simple as that. The good news is you will not be robbed blind. Given the low income of the country in general, such small imperfections are still affordable. At the same time, the 1% tax or the 3% alternative makes everything worth it.

Now, the bureaucracy means you will need to come up with dozens of documents to register a micro company. Most of them must be translated into Romanian, but also legalized – more work, more expenses. While you can do everything yourself – expect public clerks who can barely speak English and have a bad attitude, it pays off hiring someone to do everything for you. Here are a few choices.

Million Makers​

Million Makers appears to be an international company providing similar services in more than 100 countries – Romania included as well. Prices vary for each country, as well as the estimated time. Million Makers estimates the time needed for the micro company registration once all the documents have been submitted and ready for the final submission. Here are a few ideas on the fees:

-Incorporation fee – $550
-Urgent submission – $200
-Quick submission – Free
-Bank account opening – $500

You can get a merchant account for limited liability companies for $100 or a nominee director for $500. Shareholder services are charged $400, while the change of directors or shareholders will cost you $220. An increase in the authorized share capital requires more work with local authorities and is charged $950, while copies of documents certified by notaries will cost you $280.

Each situation is unique. Each business entity has different requirements. While these prices are quite informative, slight adjustments may pop up here and there. Inquire about the incorporation and move on from there.


Romania Company​

Romania Company makes it pretty straightforward by revealing the steps needed to start a company in Romania. Obviously, each of these steps requires lots of paperwork, and this is when the company kicks in to make your life easier. All entities in Romania operate independently. There are more options out there, and the micro company is one of them.

The company registration will cost you €480 and includes everything, from drafts and forms to bylaws and affidavits. Basically, you only need to put your signature on these papers, and the service will submit everything for you. You will pay €120 for each shareholder, and you get a registered office in Cluj-Napoca, which is one of Romania's biggest cities.

The office will cost €520 a year – no activity at all, but just for registration purposes. A bank account is also required – €500. You will also have to sign for the bank account. There are options to overcome this problem, but they will cost €1,000. The company deals with some of the top 10 banks in Romania – the right one will be chosen based on your needs.

Your company will also require an accounting. The authorities do not deal with random individuals, even if you actually know what you are doing. You need a registered account. This activity will cost €190 per month, as well as €15 for each employee.


La Registru​

Officially registered as Servicii Firme Online SRL, this company is specialized in registering companies in Bucharest, as well as other cities from Romania. It brings in a team of actual lawyers and can help registering the right type of business, updating potential changes, counseling, office hosting and so on – you name it, they offer it.

The company brags with more than 1,000 companies in its portfolio. Prices are not mentioned because they vary widely. However, you will need to get in touch with the company and express your needs. The best part about it? This company is mostly aimed at Romanians, rather than foreigners. In other words, it is a local company that practices local prices.

You will not be charged hundreds or thousands of Euro to start a micro company, but more realistic prices. Do expect to pay a bit more due to the necessity to translate your documents and legalize them – mandatory for local authorities. However, the overall costs are relatively low and totally worth it.

Infiintare Firma Romania​

This is another local company that caters to the local audience. Prices are more visibly displayed there, but they only represent the starting limits. They can go up based on your actual necessities. As a foreigner, you may need some documents officially translated and legalized by a notary – just some extra expenses.

For instance, to register a company with one director, you will need to pay 350 lei – about €70. Two founders will bring in another 100 lei – another about €20 – and so on for every other founder. Note that the tariffs are for Romanian citizens established in Romania. As a foreigner, chances are you will be charged more, but the prices will still be affordable.

You will pay for the consultancy as well – half an hour included in the price. It is also worth noting that you can register a company in any city in Romania. Simply drop the company an email and ask about it.


Regnet​

Regnet is slightly more credible for the local audience for some simple reasons. It is partnered with Banca Transilvania, one of the largest and more reputable banks in Romania. The company has a good reputation and allows starting a micro company in no time, without having to go through all the Romanian bureaucracy yourself.

How does it work? Drop an email with your company needs. The company will tell you what documents you need. Send them over and they will take care of your file and submission. You will get the paperwork back as soon as the company is registered. You will get your money back should the company fail due to an error caused by Regnet – less likely to happen, but it is nice to know you have a guarantee.

Consultancy is free and you get free accounting services for six months. How much does it cost? According to Regnet, the actual company registration costs around 599 lei – about €120. However, expect to pay for extra taxes and document shipping too. Altogether, the price will go up to around 737 lei with all taxes included – about €147.

Since you are a foreigner, you will pay more for translating documents.


How to choose the right service for micro company registration in Romania​

At this point, you have more options. In the above-mentioned examples, the first two services cater to international customers and not to Romanians. They have already done all the hard work and they speak great English. They know what you need upfront. Costs, however, are higher than for a local Romanian who needs a company.

The last companies cater to Romanians. Prices are suitable for the local market. Most people choose to do it themselves due to the poor economy – they would rather save some money and wait in queues themselves. They are not specialized to foreigners, but most of them speak decent English. There is more work involved, such as document translations and legalization. Prices are still low.

Now, to the average Romanian clerk, translating basic documents is fairly simple. When it comes to more sophisticated documents, they may find it difficult to explain what you need. Technical terms are difficult to translate – Romanian is quite a difficult language – and some of them may not make sense because they are local.

Should you go for the money-saving option, you might try to deal with a company yourself or hire a local assistant – someone who can translate everything for you and represent you.


A few words about getting an office​

The same story applies to offices. If you want to work there and get there often, you need an office in a good and safe area. If you only need it for registration purposes, you might as well find an old insecure building in the middle of nowhere – the problem is most real estate agents avoid such places. As a foreigner, you will receive prime office areas because everyone in Romania assumes you can afford it.

Prices vary between €8 and €19 per square meter monthly. Cluj-Napoca and Bucharest are quite expensive, but other big cities may also get pricey if you want a downtown office. To help you get an idea, here are the rates around Bucharest – keep in mind that vacancy rates are pretty low:

-Piata Presei Libere – €15/sqm/month
-Calea Floreasca – €15/sqm/month
-Dimitrie Pompeiu – €12/sqm/month
-Pipera – €9/sqm/month
-West and center – €14/sqm/month
-East – €12/sqm/month


Where to find an office for your micro company​

There are a few local websites that advertise houses to let, offices, flats and so on. Stick to local websites for realistic prices.

-Publi24 – go to Imobiliare, choose De Inchiriat, select Spatii de inchiriat, go for Birou and select the location.
-Storia – select Birouri instead of Apartamente, choose De inchiriat instead of De vanzare, choose the location and search.
-Imobiliare – select Birouri instead of Apartamente and choose De inchiriat instead of De vanzare, as the location is already set to Bucharest by default.
-Imoradar24 – choose Inchiriez instead of Cumpar, select Un spatiu comercial instead of Un apartament and search.

This might be the more difficult part – you need to ensure you find an owner or agent who speaks good English. Should you choose to hire a local assistant to help out with the company registration, you might as well use them to help out with the office – probably the more trustworthy option if the company registration service does not provide access to an office too.


Conclusion

Bottom line, Romania is a decent choice to keep your taxes low for micro-companies. Keep in mind that other business entities will be charged much more, but micro companies will go for 1% or 3% only. While English is common in Romania, some middle or older generations may not be too good with it, so you may need a translator or an assistant to help with the process.

It is, indeed, an investment, but you will make your money back in no time with the low taxes.