No special tax treatment for Ukrainian war refugees in Romania


Approximately 1.5 million Ukrainian citizens have entered Romania since February 2022, according to publicly available information, and more than 87,000 have remained in the country. Some secured employment in fields such as the manufacturing industry, construction, hotels and restaurants, or trade, while others set up small family businesses in Romania.

According to the latest statistics of the Ministry of Labour and Social Protection, more than 6,400 Ukrainian citizens are integrated in the Romanian labour market; out of which, 4,282 employment contracts have a start date that matches the date of the outbreak of the conflict in Ukraine.

What does it mean, from an individual tax perspective, for a Ukrainian citizen to stay more than six months in Romania and what details of the Romanian tax legislation should they pay attention to?

While things are somewhat easier in respect of establishing a legal residence in Romania and accessing the national labour market, thanks to the available legislative exemptions, from an individual tax perspective, a stay in Romania for a period of longer than six months – or, more precisely, longer than 183 days – can translate into additional tax liabilities.

Obligations triggered by a longer than six months stay

As per the provisions of the Romanian tax legislation, any individual arriving in the country and staying there for more than 183 days in any 12 consecutive months, ending in the calendar year concerned, must file an arrival tax residency questionnaire with the Romanian tax authorities.

The questionnaire should be filed only after spending 183 days in Romania. Based on it, the Romanian tax authorities issue a tax residency notification that confirms whether the individual is regarded as a Romanian tax resident.

Ukrainian citizens assessed as Romanian tax residents are taxable in Romania on their worldwide income.

If certain funds have already been transferred to Romania, it is determined that the source of any subsequent income, such as interest income, would be a Romanian one. This leads to the automatic taxation of the income in Romania.

Tax residency in Romania entails reporting and tax payment obligations with respect to any foreign income that the Ukrainian citizen could obtain, as of the first day of presence in the country, including:

  • Income from renting out a property owned outside Romania; and

  • Income derived from holding and/or transferring shares or other similar investments that the Ukrainian citizen may have outside Romania.

All these additional reporting and tax payment obligations with respect to personal income (other than salary) rest with the Ukrainian citizen. Furthermore, a stay in Romania, by establishing residence in the country, also qualifies the Ukrainian citizen as a payer to the Romanian mandatory social security system and could trigger additional social security payment obligations with regard to personal income.

While tax residency status plays an important role in terms of personal income (other than salary) and must be determined based on the procedure described above, the approach is different with regard to salary income.

Ukrainian citizens employed in Romania and undertaking employment activities in the country are subject to full salary taxes (income tax and mandatory social security contributions), but without personal additional reporting and/or payment obligations, similar to Romanian employees. The salary taxes reporting and payment obligations rest with the Romanian employer. This is the case for the over 6,400 Ukrainian citizens employed by Romanian companies and is reflected in the statistics of the Ministry of Labour and Social Protection.

On the other hand, Ukrainian citizens working in Romania while still being paid by a Ukrainian employer have the personal obligation to report and pay the tax liabilities due in Romania, both from an income tax and social security perspective.

In a nutshell, the Romanian tax legislation does not provide for any special exemptions regarding Ukrainian citizens who are war refugees. Moreover, a change of an individual’s tax residency to a Romanian one, by fulfilling the legislative requirements corroborated with the provisions of the double taxation treaty between Romania and Ukraine, triggers additional tax liabilities for Ukrainian citizens established in Romania.

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