Type at least two letters.

    Get a quote
    Resources · Tools

    Do you have a permanent establishment in Romania?

    A permanent establishment is not something you set up or opt into: it either exists or it does not, depending on what your company actually does in Romania. An office at your disposal, an employee working from here, someone signing contracts in your name, a construction site running past six months — any of these can be enough, and the tax runs from the date the conditions were met, not from the date you register.

    • Runs locally, in your browser
    • Fiscal Code art. 8 · OECD art. 5
    • Three-level result

    Reviewed by Silvia, Chartered Accountant (CECCAR) · updated

    Step 12–6 more questions

    Where is the company tax resident?

    A treaty can raise the construction threshold from six to twelve months and may or may not carry a services clause; without a treaty only the stricter domestic rule applies.

    The assessment runs in your browser; your answers are not sent anywhere.

    How the check works

    We ask a few simple questions, one at a time; your answer decides what we ask next. At the end you get an indicative result — green, amber or red — with the article of the Romanian Tax Code behind every rule applied, and the notes that matter, including where the answer turns on the double tax treaty between Romania and your state of residence. The tool does not tell you how to avoid a permanent establishment: that is not what it is for, and not a subject we cover. It tells you where the risk arises and what obligations would follow.

    There is no score and no average. The result is the end of the branch you follow: every endpoint carries a level and a fixed set of notes, and if you describe several situations, the final level is the highest of them. The analysis follows the order the law sets: first art. 8 of the Romanian Tax Code and the implementing Norms, then the treaty with your state of residence — a treaty can only restrict Romania's taxing right, never create it, and relying on it requires a certificate of tax residence (art. 230(2)).

    Nothing you answer leaves your browser. The whole assessment runs on your device; the only data that reaches us is what you deliberately send through the quote form.

    What this tool does not assess

    A VAT fixed establishment is a different test, in a different title of the Tax Code: art. 266(2)(b) requires "sufficient technical and human resources to regularly carry out taxable supplies of goods and/or services". You can have a fixed establishment without a permanent establishment and the other way round; where both exist, the fixed establishment becomes the designated permanent establishment (art. 37(5)). For the VAT registration obligation we have a separate tool: do I need to register for VAT, next to the page on VAT registration for non-residents.

    The tax residence of an individual (the 183 days, the centre of vital interests — art. 7 point 28 and art. 59) and the fixed base of a non-resident individual (art. 8(9)) are analysed separately, on their own criteria.

    The place of effective management is outside this tree, although its effect is more serious: if the key management decisions are taken in Romania, or at least 50% of the executive directors or board members are residents, the foreign company can be treated as tax resident in Romania and taxed on its worldwide income (art. 7 point 18 and art. 8^1). The tool flags this in a note but does not assess it.

    The legal framework in brief

    The definition. Art. 8(1) of the Tax Code: a permanent establishment is a place through which the activity of a non-resident is carried on wholly or partly, either directly or through a dependent agent. The Norms (point 3 to art. 8) set out the four elements: a place of business, at the enterprise's disposal ("no written instrument is required"), fixed geographically and commercially, maintained "for a period longer than 6 months", through which the business is carried on with regularity.

    Construction sites. Art. 8(3) finds a permanent establishment for a building site, construction project, assembly or installation project or related supervisory activities "only if the site, project or activities last more than 6 months". Art. 5(3) of the 2017 OECD Model Convention requires twelve months, and the actual treaties generally take the 12-month threshold — those with Italy (2015) and China (2016), for instance. Periods spent on connected contracts are added to the base contract (art. 8(8)).

    The agent. Art. 8(5) finds a permanent establishment where a person other than an agent of independent status "is authorised and exercises in Romania the authority to conclude contracts on behalf of the non-resident", or maintains in Romania a stock of goods from which deliveries are made on the non-resident's behalf. This is the pre-BEPS wording: the 2017 OECD Model also covers the principal role leading to the conclusion of contracts and dropped the stock rule, but Romania entered reservations to articles 12–15 of the Multilateral Convention, deposited on 28 February 2022, so the definition in the 85-plus covered treaties was not changed by that route.

    Taxation. Art. 36(1) requires foreign legal persons carrying on business through a permanent establishment to pay corporate income tax on the taxable profit attributable to it, at the 16% rate (art. 17), the profit being attributed under transfer pricing rules and the 2010 OECD Report (art. 36(3)). Art. 36(4) and the Norms (point 37) set the retroactive effect: income and expenses are carried forward, and the tax is due from the start of the activity once the domestic six-month period or the treaty threshold is exceeded.

    Frequently asked questions

    01Is a permanent establishment something you register, or does it simply arise?

    It arises by itself, from the facts. The Tax Code offers no "option" to set one up: if there is a place through which the business is carried on, or a dependent agent, the permanent establishment exists, and tax is due from the start of the activity even if registration happens later (art. 36(4) and the Norms to art. 36, point 37).

    02Why does Romanian law say 6 months for construction sites when everyone quotes 12?

    Because these are two different texts. Art. 8(3) of the Tax Code says 6 months; art. 5(3) of the 2017 OECD Model says 12, and the actual treaties generally take the 12-month version — the treaties with Italy (2015) and China (2016), for instance. The treaty prevails and can restrict Romania's taxing right, provided a certificate of tax residence is produced (art. 230(2)).

    03Does an employee working from home in Romania create a permanent establishment?

    Not automatically. The OECD Commentary on art. 5, §§18–19, requires the home to be used on a continuous basis for the enterprise's business and the enterprise to have required that arrangement — for example by not providing an office where the nature of the work clearly calls for one. Intermittent or incidental presence is not enough. Conversely, the Norms to art. 8 give the example of a contractor spending three days a week for two years in a client's building, performing there the core function of his business: that is a permanent establishment.

    04I have a subsidiary in Romania. Does that mean the parent has a permanent establishment?

    No. Art. 8(7) states that a control relationship alone does not create a permanent establishment. But the subsidiary can become one if it in fact makes premises available through which the parent carries on its own business, or if the subsidiary's staff act on the parent's behalf as a dependent agent (art. 8(5)). In the second case the independent-agent exception fails, because the activity is carried on almost exclusively for the parent.

    05Are a permanent establishment and a VAT fixed establishment the same thing?

    No. They are two separate tests: the permanent establishment belongs to corporate income tax (art. 8), while a VAT fixed establishment requires "sufficient technical and human resources to regularly carry out taxable supplies of goods and/or services" (art. 266(2)(b)). You can have one without the other. Where both exist, the fixed establishment becomes the designated permanent establishment for corporate tax purposes (art. 37(5)).

    Sources and legal basis

    1. Romanian Tax Code (Law no. 227/2015) — art. 8, "Definition of the permanent establishment" — Paragraph (1) the definition; (2) the list of examples; (3) construction sites — 6 months; (4) preparatory or auxiliary activities; (5) the dependent agent — authority to conclude contracts and the stock from which deliveries are made; (6) the independent agent; (7) subsidiaries; (8) registration of service contracts; (9) the fixed base of an individual.
    2. Implementing Norms to the Tax Code (Government Decision no. 1/2016) — Title I, Section 3, point 3 to art. 8 — Paragraphs (1)–(7): the place at disposal, fixity, the six-month permanence and the four examples (the salesman, the office made available, the loading dock, the painter); (8) leased equipment; (9) the dependent agent at a fixed place; (11)–(19) websites, servers, hosting, e-commerce; (20)–(21) the services covered by art. 8(8).
    3. Tax Code — art. 17 (the 16% rate), art. 36 (taxable result of a permanent establishment) and art. 37 (the designated permanent establishment) — Art. 36(1) the obligation to pay; (2) attribution of income and expenses; (3) transfer pricing and the 2010 OECD Report (reference inserted by GEO no. 115/2023, in force from 1 January 2024); (4) retroactive effect; (5) the single permanent establishment. Art. 37(1)–(4) designation and aggregation; (5) the fixed establishment that is also the designated permanent establishment.
    4. Tax Code — art. 223–224 (income of non-residents, withholding tax) and art. 230 (applying treaties, the residence certificate) — Art. 223(2)(a): income attributable to a permanent establishment is not taxed under Title VI but under Title II or IV. Art. 223(1)(c), (e), (g), (l), (o): interest, royalties, commissions and management fees that are expenses of the permanent establishment become Romanian-source income. Art. 230(2): the certificate of tax residence.
    5. Tax Code — art. 266(2)(b): the definition of a VAT fixed establishment — Used only for the boundary "permanent establishment (corporate tax) ≠ fixed establishment (VAT)". The VAT test: sufficient technical and human resources to regularly make taxable supplies. It transposes art. 11 of Implementing Regulation (EU) no. 282/2011.
    6. OECD, Model Tax Convention on Income and on Capital: Condensed Version 2017 — Article 5 and the Commentary on Article 5 — Art. 5(1) the definition; (3) twelve months for construction sites; (4) preparatory or auxiliary activities; (5) the agent — "habitually plays the principal role"; (6) the independent agent — "exclusively or almost exclusively". Commentary: §§14–19 (place at disposal, home office), §§51–55 (duration of a site, subcontractors, seasonal interruptions), §144 (the alternative service-PE provision, 183 days).
    7. Romania's position on the Multilateral Convention (MLI) — reservations and notifications deposited with the OECD — Deposited on 28 February 2022. Full reservation to art. 12 (commissionnaire arrangements), art. 13 (specific activity exemptions, including anti-fragmentation), art. 14 (splitting-up of contracts) and art. 15 ("closely related"). Consequence: the permanent establishment definition in Romania's treaties was not amended by the MLI.
    8. Law no. 5/2022 ratifying the Multilateral Convention (MLI) — Official Gazette, Part I, no. 28 bis of 10 January 2022. Signed by Romania in Paris on 7 June 2017; in force for Romania from 1 June 2022; effects from 1 January 2024.
    9. ANAF — Double tax treaties (list and texts) — The examples used here: Romania–Italy (25.04.2015) — 12-month site threshold; Romania–China (04.07.2016) — 12-month site threshold and a services clause of more than 183 days in 12 months.
    10. ANAF President Order no. 2994/2016 — registration of contracts concluded with non-residents — Official Gazette no. 854 of 27 October 2016, issued under art. 8(8) of the Tax Code. The obligation rests with the resident customer; form 017; 30 days from conclusion of the contract; amendments within 15 days; contracts for activities carried out outside Romania are not registered.
    11. ANAF President Order no. 828/2026 — the transfer pricing file — Official Gazette no. 543 of 2 July 2026, issued under art. 36(3) and art. 37(3). Thresholds are computed per transaction category and per related party. It applies to transactions from 2026 and to administrative procedures started after 1 January 2027.
    12. GEO no. 8/2026 — amendments to the Tax Code, including the annual corporate tax return deadline — Official Gazette no. 147 of 25 February 2026. It amends art. 42(1): the annual return is filed by 25 June of the following year, starting with the return for 2026 (art. 45(21^4)). It does not amend art. 8 or art. 17.
    13. ANAF Order no. 1699/2021, as replaced by Order no. 15/2026 — form 013 — Official Gazette no. 17 of 14 January 2026. Annex 2: the tax registration return for non-resident taxpayers carrying on business in Romania through one or more permanent establishments. Form 015 is the one for non-residents without a permanent establishment.
    14. ANAF Cluj — "Taxation of Romanian-source income of non-residents", 21 October 2025 — An ANAF publication stating the rule in art. 223(2)(a) and listing the applicable acts, including Order no. 2994/2016. Not a source of law, but it shows how the tax authority proceeds.
    15. CJEU — C-533/22 SC Adient (13 June 2024), C-333/20 Berlin Chemie A. Menarini (7 April 2022), C-232/22 Cabot Plastics Belgium (29 June 2023) — Case law on the VAT fixed establishment, used only for the boundary and for the substance note — not as a basis for corporate income tax. Adient: belonging to the same group and having a services contract do not, in themselves, create a fixed establishment.
    16. OECD, 2010 Report on the Attribution of Profits to Permanent Establishments — Expressly referenced in art. 36(3) and art. 37(3) of the Tax Code for attributing profit to a permanent establishment.

    Tell us what you do in Romania. You get a written, fixed-fee quote.

    The initial consultation is free and without obligation. Reply within one business day, in English or Italian. No call required, no travel, nothing to prepare — three sentences are enough.

    Request a quoteOr write on WhatsApp
    WhatsApp