Micro-enterprise tax or profit tax in Romania: conditions and choice
Updated: 4 days ago
In Romania, a company pays either profit tax of 16% on its taxable profit (art. 17 of the Fiscal Code) or, if it meets the conditions and opts for it, micro-enterprise tax of 1% on its revenue (art. 51(1)). Under the text in force, the micro-enterprise tax is optional (art. 48(1)).
Which companies can apply the micro-enterprise tax?
A Romanian legal person qualifies if, on 31 December of the previous year, it meets all of these conditions (art. 47(1)):
its revenue did not exceed the RON equivalent of EUR 100,000, counted together with the revenue of linked enterprises (lit. c and art. 47(1^1));
its share capital is held by persons other than the state and local authorities (lit. d);
it is not in dissolution followed by liquidation (lit. e);
it has at least one employee, subject to the exception in art. 48(3) (lit. g); a full-time employment contract, part-time contracts adding up to one full-time post, or a management or mandate contract paid at least the gross minimum wage count (art. 51(4));
its shareholders holding more than 25% have chosen it as the only legal person applying the micro-enterprise regime (lit. h);
it filed its annual financial statements on time, if it had to (lit. i).
Some entities cannot apply the regime at all, for example banks, insurance and capital market companies, gambling operators and companies exploring or exploiting natural resources (art. 47(3)).
When does the choice take effect?
A company may opt for the micro-enterprise tax from the fiscal year following the one in which it meets the conditions (art. 48(2)).
A micro-enterprise cannot switch to profit tax during the fiscal year; the option applies from the next fiscal year, except in the cases in art. 52 (art. 48(2^1)).
When does a micro-enterprise move to profit tax during the year?
Revenue above EUR 100,000 during the year: profit tax from the quarter in which the limit was exceeded (art. 52(1)).
Annual financial statements for the previous year not filed on time: profit tax from the quarter in which the condition is no longer met (art. 52(2)).
The only employment contract ends and no new employee is hired within 30 days: profit tax from the quarter after the one in which the contract ended (art. 52(3)). See also medical leave and micro-enterprise status.
How do the two regimes compare?
Tax base: micro-enterprise tax applies to revenue, whatever the expenses; profit tax applies to taxable profit, so deductible expenses reduce it (art. 51 and art. 19 onwards).
Rate: 1% of revenue (art. 51(1)) against 16% of taxable profit (art. 17).
Losses: a company with low margins or a loss still pays micro-enterprise tax on its revenue, while a loss-making profit-tax payer of this size owes no profit tax for that year.
Conditions: the micro-enterprise regime depends on the revenue limit, the employee condition and the shareholder condition each year; profit tax has no such conditions.
The result depends on the margin and the expected growth of the business; compare both regimes on the company’s own figures before opting.
Sources: Fiscal Code (Law 227/2015), consolidated by ANAF, art. 17, 47, 48, 51 and 52.
Last updated: 3 November 2026 (article revised and verified against the current text of the Fiscal Code). This article is for information only and does not replace an analysis of your specific situation. Updated with AI assistance; references were verified against the primary sources.
