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02 September 2023

Why other investors have already decided to start a business in Romania ?

Discover the allure of Romania as a thriving business destination! Uncover the reasons why numerous investors have eagerly chosen to embark on their entrepreneurial journey in this vibrant country. With its strategic location at the crossroads of Europe, Romania offers a gateway to a vast market of over 500 million consumers. This advantageous position, coupled with its membership in the European Union, grants businesses access to a wide range of trade opportunities and favorable economic conditions | 5 reasons to invest in Romania. Others did it: 1. Easy company incorporation; 2. Attractive tax system; 3. Dynamic regional economy; 4. Strategic location; 5. Skilled labor force

 

Here is why you should choose open business in Romania

 

Romania has one of the most fast-growing and competitive economies in EU countries, with the highest growth rate in CEE area and one of the highest rate in the whole European Union,  being a strategic decision for new foreign investors to start business hereExplore the top 5 compelling reasons why investing in Romania can lead to lucrative returns and long-term success.

 

Unveiling the key factors that make Romania an ideal destination for entrepreneurs looking to establish their business. Here are the most important 5 reasons to consider opening a company in Romania:

 

1. The Romanian tax system is a paradise, the tax quotas being quite reasonable, one of the lowest in EU

 

  • Significant advantages and exemptions for start ups and small businesses compared to other EU countries:

  • Income tax: 1% on your turnover if you have at least one employee and the obtained income is less than EUR 60.000 and 3% if it is less than EUR 500,000 or the company engaged in some specific activities; otherwise it will be applicable the corporate tax, on the profit;

  • Corporate tax: 16% of the gained profit (difference between income and expenditures) - one of the lowest in EU;

  • Dividend tax; 8% of the paid dividend;

  • Low fees for the accounting services, starting from EUR 80/month, depending on the volume of your company activity.

 

Romania's tax system is a true gem in the European landscape. It strikes a balance between generating revenue for the government and fostering economic growth. The government has implemented a range of tax incentives and exemptions to attract investment and stimulate key sectors of the economy. Additionally, the system promotes fairness by ensuring that individuals and businesses contribute their fair share based on their income and profits. With its progressive approach and commitment to supporting economic development, the Romanian tax system is undoubtedly a paradise for taxpayers.

 

In order to find more about taxation of the LLC in Romania, please read our brief articles, one related to the turnover tax / corporate tax - What taxes your Romanian company pays? Chapter I and the second one related to the dividend tax - What taxes your Romanian company pays? Chapter II.

 

2. Cheap and qualified local workforce in Romania, in comparison with other EU countries

 

  • Lower wages than in most EU countries; the current minimum wage in Romania is RON 3,000 per month (approx. EUR 600);

  • Quality and talented labor force. Romania is well known for its great universities, especially in IT, medicine, automotive and engineering field, providing highly skilled English speaking personnel;

  • Cost of living lower than in EU. Cost of living in Romania is 64% lower than the average of EU countries, according to EUROSTAT.

 

Romania boasts a highly skilled and cost-effective local workforce that is sure to meet your business needs. With a reputation for excellence in various industries, Romania offers a pool of talented professionals who are not only qualified but also affordable. This combination of quality and affordability makes Romania an attractive destination for companies looking to optimize their operations and reduce costs without compromising on talent.

 

3. Strategic connection. Easy links to Europe

 

  • Easy access to the rest of EU countries, Very good links in the business area and travel with EU, Middle East and CIS states;

  • One of the largest marketplace in EU. Attraction for the foreign investors aiming to gain incomes from the second largest country in CEE

  • Fastest internet speed in EU, Highly developed and competitive internet infrastructure and profesionalls

  • Bucharest has developed a lot in the past years – modernization, constructions of new buildings for homes and offices and legislations improvements for supporting businesses developed on the territory. 

 

Romania's strategic connection and easy links to Europe make it an ideal gateway for businesses and travelers alike. Situated at the crossroads of Eastern and Central Europe, Romania offers a unique advantage for companies looking to expand their operations in the region. With its well-developed transportation infrastructure, including modern airports, highways, and railways, Romania provides seamless connectivity to major European cities. This strategic positioning not only facilitates trade and commerce but also promotes cultural exchange and tourism, making Romania a vibrant and dynamic destination.

 

4.  Tremendous increase of the real estate market in Romania

 

  • Very cost effective property prices. Attractive prices compared to other EU states for buying and renting land, residential, non-residential and agricultural real estate in Romania;

  • Rising rental yields. The investment in real estate grows quickly, generates good rental yields and may represent a good source for passive income;

  • Upward trend in the construction field. The construction field continues its solid growth even in 2023 

 

Romania's real estate market has experienced an unprecedented boom, with a surge in both residential and commercial properties. This remarkable growth has been fueled by a combination of factors, including a strong economy, increased foreign investment, and favorable government policies. As a result, the market has witnessed a tremendous increase in property values, attracting both local and international buyers. The real estate sector in Romania is now a hotbed of activity, with developers scrambling to meet the growing demand and investors eager to capitalize on the lucrative opportunities available.

 

5. Flexibility of set up company proceedings in Romania:

 

  • Quick proceedings for incorporation. Romania benefits of a modern legislation and infrastructure for your company to be registered and functional in 3 days as of the data the incorporation request has been filed.

  • Flexibility on company ownership. You can be the sole shareholder in your company. And even in other Romanian companies. It is allowed to distribute dividends every 3 months based on your company's quarterly profit.

  • Plenty of incentives and measures. Romania grants annually plenty of measures and incentives for encouraging start-ups and business sector (Start Up Nation 2023, EU non-repayable funds, Norway grants, special incentives and exemptions for IT programmers etc.)

 

Setting up a company in Romania is a breeze thanks to the country's flexible and efficient procedures. Unlike many other countries, Romania has simplified its business registration process, allowing entrepreneurs to establish their companies quickly and with minimal hassle. The government has implemented various measures to streamline the process, such as online registration platforms and dedicated support services, ensuring that the entire setup is smooth and hassle-free.

 

Experience the thriving business environment in Romania and capitalize on its strategic advantages for your investment portfolio. Unlocking the Potential: Investing in Romania

 

You may check other info related to the company registration in Romania process here. Also you may read more about the advantages and disadvantages of setting up a company in Romania in our article 10 facts you need to know about the limited liability company in Romania.

 

For a synthesis of this article, please see the section ”5 solid reasons why you should consider investing in Romania” available here, on the first page.

 

Don't hesitate to reach us at tudor@roadvocacy.ro or +40 723 77 37 59 or using the contact form on at www.roadvocacy.ro. We're here to help and answer any questions you may have.

 

The blog of the Romanian lawyer

 

 

 

The Lawyer's corner is nothing else but a legal blog dedicated only for entrepreneurs and investors in Romania 

 

Weekly usefull posts about the investors' first steps in Romania, from the perspective of practicing business law, servicing our clients' needs and litigation, written and published by a Romanian litigation lawyer with over 15 years experience

 

 

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Romanian Advocacy

 

| Your Business | Our Mission |

Romanian Advocacy

 

| Your Business | Our Mission |

Romanian Advocacy

| Your business | Our mission |

 

Full range of legal services for businesses, companies and individuals. Your lawyers in Romania.

 

Romanian Advocacy

| Your business | Our mission |

 

Full range of legal services for businesses, companies and individuals.

 

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