Business in Romania: SRL or PFA, ANAF taxes, e-Factura and penalties to avoid

When business in Romania starts to hurt

A typical story. Someone opened an SRL or PFA in Romania a year or two ago, hired an outsourced contabil autorizat who sends files to sign each month, and thought taxes were settled. Then a letter arrives from ANAF: a fine because the invoice didn't reach the e-Factura system in time, or notice that the company lost its microîntreprindere status mid-year and must recalculate tax under a different formula — and pay the difference.

Second typical situation — a PFA whose annual revenue exceeded the threshold, and suddenly it turns out VAT registration was two months overdue. Or the owner discovers an obligation to pay CAS and CASS after the declaration deadline has already passed. The conditions for regimes, thresholds, and obligations in Romania change regularly, and while the contabil submits the numbers, they rarely warn in advance and almost never engage with ANAF when fines or audits appear.

This is the point where accounting support ends and legal protection begins. The contabil is responsible for the figures in declarations. But when ANAF issues a decizie de impunere (assessment decision) or schedules an inspecție fiscală, the owner must respond — and that requires a lawyer who understands both the business structure and tax authority logic.

SRL or PFA: which to choose

The first decision — which determines almost everything else in how your business is taxed in Romania — is organizational form. The most common options for small and medium business are SRL (limited liability company) and PFA (individual business form).

PFA: simplicity and personal liability

PFA registers faster and has fewer formalities, so it suits those working mostly alone — consultants, translators, craftspeople, freelancers. But the key point often underestimated: the PFA owner is personally liable for all business obligations with all personal assets. If debt arises to a client or ANAF, there is no legal boundary between "business" and "personal."

SRL: limited liability and more formalities

SRL is a separate legal entity. The owner's liability is limited to their stake in the capital, not all personal assets. This matters for anyone planning to hire employees, sign large contracts, or separate business risk from personal savings. The downside is more routine: separate accounting, annual reports, shareholder meetings, dividend taxation when withdrawing profit.

Choosing between SRL and PFA is not just about paperwork. It's a decision about who bears risk and how profit is taxed on exit (dividends in SRL vs. direct income in PFA). An SRL typically looks more professional to clients with supplier requirements.

Microenterprise or profit tax

For SRL in Romania, there are two fundamentally different profit tax regimes: the simplified microîntreprindere (microenterprise tax) calculated on turnover at a reduced rate, and the standard impozit pe profit (profit tax) calculated on actual profit with deductible expenses. The difference is huge — microenterprise tax is turnover-based with a fixed rate, while profit tax requires tracking expenses and making adjustments.

The problem is that conditions for qualifying for microîntreprindere status are reviewed almost every year: revenue ceiling, employee requirements, activity restrictions — all can change by law starting each tax year. A company operating under microenterprise status last year may suddenly be required to switch to impozit pe profit this year, sometimes even mid-year if the revenue threshold is exceeded.

Switching from microenterprise to standard regime is not routine: different tax base, different expense accounting logic, different reporting deadlines. If the switch happens without the owner noticing, they'll owe the tax difference retroactively, often with penalties.

Dividend taxation

When an SRL pays dividends to the owner, that distribution is taxed separately as dividend income — regardless of which regime the company used for profit tax. This is a second tax layer many new business owners discover too late: the figure showing as "net profit" on the balance sheet is not yet the amount the owner receives personally after dividend tax.

CAS and CASS: when PFA must pay contributions

For PFA, social contributions work differently than for employees or SRL owners receiving dividends. CAS (pension insurance contribution) and CASS (health insurance contribution) for PFA are tied to annual income level and become mandatory when income exceeds a threshold set in minimum wages. As long as income is below the threshold, CAS obligation may not arise; once exceeded, it does — often for the full year, not just on the excess amount.

The complexity is that thresholds for CAS and CASS don't always align, and the thresholds themselves are expressed in minimum wages, which also change. Many PFA owners discover the obligation to pay CAS and CASS only after year-end — when the income declaration shows the threshold was exceeded and the voluntary payment deadline has already passed.

Another nuance: the obligation to pay CAS and CASS as a PFA exists separately from whether the person also works under an employment contract and already pays contributions from salary. In some cases, PFA income and employment income are counted separately for thresholds, and someone who thought "contributions are already being paid through my employer" gets an additional obligation from ANAF.

VAT: registration and cash accounting

VAT registration in Romania comes in two types: mandatory — when turnover exceeds an established threshold, and voluntary — when a company or PFA registers before reaching the threshold, for example because clients require it or to claim input TVA deductions.

The mandatory registration threshold is calculated as cumulative turnover, and a typical mistake occurs: the owner tracks the threshold "by eye" rather than by precise turnover figures calculated by the contabil. The moment registration becomes mandatory passes unnoticed — and ANAF demands retroactive registration and TVA declaration for the entire missed period, including late-payment penalties.

Cash accounting for VAT

A separate tool is cash-basis TVA accounting (taxing based on payment received from the client rather than invoice date). It's not available to all taxpayers and not always advantageous: for businesses with long client payment terms it improves cash flow, but for businesses buying on credit from suppliers it complicates input TVA deductions. The decision should be made with the contabil, calculating real impact on your specific sales and purchase structure, not following generic internet advice.

VAT rates, registration thresholds, and cash accounting conditions are periodically adjusted by law. When planning for next year, especially if turnover approaches the threshold, verify current figures specifically rather than relying on previous advice or articles, including this one.

e-Factura, e-Transport and reporting calendar

Over recent years, Romania's tax system has shifted heavily toward real-time electronic reporting, and this is where most small business penalties accumulate — not from unpaid taxes, but from reporting oversights.

e-Factura

The e-Factura system requires submitting issued invoices electronically through the ANAF platform within a set timeframe after issuance. Missing the deadline, formatting errors, or sending an invoice directly to the contractor without processing it through the system — all trigger fines, with penalties applied per invoice. For a business issuing dozens of invoices monthly, even a technical error in invoicing software can result in substantial fines.

e-Transport

The e-Transport system applies to declaring goods movement — primarily cargo of certain value or category being transported within Romania or crossing borders. Missing an e-Transport declaration for applicable movement is a separate fine basis, and this obligation is often forgotten by companies for whom logistics isn't the main activity but a one-time operation (like moving equipment).

D112 and reporting calendar

Form D112 (consolidated declaration of contributions and taxes withheld from employee salaries) is filed monthly for companies with employees and has its own submission deadline, separate from TVA or profit tax deadlines. A typical situation — the contabil keeps the calendar correctly, but the owner doesn't get clear warning that the responsibility rests with them as director.

The overall reporting logic involves multiple separate streams (TVA, profit or microenterprise tax, contributions through D112, e-Factura, e-Transport) with different deadlines that don't align on one calendar. Missing several deadlines in a row signals to ANAF to pay closer attention and schedule an inspecție fiscală.

How Dorosh & Partners supports business in Romania

An accountant keeps the numbers. A lawyer responds when ANAF asks questions, imposes fines, or schedules audits. These are two different professions with different responsibilities, and this is why Dorosh & Partners provides both together.

The working model is simple and designed so the owner doesn't have to navigate Romanian bureaucratic language alone. A client explains their situation in plain language to the lawyer — "received a letter from ANAF," "a contractor says the invoice didn't go through e-Factura," "the accountant says we lost microenterprise status." The lawyer translates this into legal language for the advocate: frames the dispute, gathers documents, identifies the applicable procedure — contesting a decizie de impunere, responding during an inspecție fiscală, or negotiating with the other party.

The lawyer then directs the advocate precisely where the client needs help, monitors progress, and ensures the case moves on schedule — rather than sitting idle while appeal deadlines pass. The owner receives clear interim reports and concrete next steps, not legal jargon.

What support includes

• Selecting and structuring your business form — SRL or PFA — based on the liability you're willing to accept.
• Verifying microîntreprindere regime conditions and planning the transition to impozit pe profit if necessary.
• Monitoring VAT registration deadlines and assessing the value of cash accounting.
• Responding to e-Factura and e-Transport fines: checking grounds, filing appeals within the deadline.
• Supporting you during an inspecție fiscală: organizing documents, communicating with the inspector, contesting the decizie de impunere.
• Handling contracts with clients, employees, and partners — preventing disputes that could end up in court.

The key difference between this support and basic accounting outsourcing: the contabil is responsible for accuracy of submitted figures, not for protecting the business when those figures come under scrutiny. When ANAF sends a fine, schedules an audit, or a dispute arises with a contractor, the lawyer must respond — and it's far better if they already know the company structure rather than meeting it for the first time after a letter with a deadline.

Frequently asked questions

What's cheaper to tax — SRL or PFA?

There's no single answer: it depends on income level, type of activity, and how much profit you plan to keep in the business versus withdraw personally. PFA is simpler to manage, but the owner is personally liable for all obligations. SRL requires more reporting but limits liability. Compare specific numbers for your specific activity, not general rules.

What happens if a company loses microenterprise status mid-year?

The obligation arises to recalculate tax under impozit pe profit starting from the date set by law, and file appropriate declarations. You'll owe the tax difference and any penalties. The key is to make this change yourself and promptly once the threshold is exceeded, rather than waiting for ANAF to discover the discrepancy.

Can you contest an e-Factura fine?

In many cases, yes — especially if the reason is technical (system malfunction, file format error, or miscalculated deadline). But the appeal window is limited, so contact a lawyer immediately after receiving the decision, not later.

Do you need a separate lawyer if you already have an authorized accountant?

The contabil is responsible for accuracy of filed declarations and figures. They don't negotiate with ANAF during audits, don't file appeals against decisions, and don't protect the company's interests in disputes with contractors. For that you need a lawyer who knows the business structure and can respond quickly when issues arise.

When does a PFA have to register as a VAT taxpayer?

The obligation arises when cumulative annual turnover exceeds the registration threshold. The threshold and calculation method vary by year and are set by law, so check current figures for the relevant year rather than assuming last year's rules apply. Track turnover with your contabil, not by rough estimates.

Romania's tax system for small business consists of several parallel streams of rules that update regularly — and this complexity, not any single error, is usually what triggers fines and audits. Timely review of your regime, thresholds, and reporting calendar together with your accountant and lawyer in coordination lets you catch issues before they become an ANAF letter with a response deadline.

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