In 2025, Romania’s VAT system has undergone some important changes. Understanding the applicable rates, the exemption threshold, and the rules for applying VAT is essential for entrepreneurs, small and medium-sized businesses, as well as professionals providing services.
 
VAT Rates in 2025

Romania applies two main VAT rates:
 
Standard rate: 21%
Applies to most goods and services, such as electronics, furniture, professional services, and consulting.
 
Reduced rate: 11%
Applies to certain essential goods and services, including:
  • Basic food and non-alcoholic beverages
     
  • Water, heating, and gas for household consumption
     
  • Accommodation and tourism services
     
  • Books, manuals, and magazines
     
In 2025, the previous 5% and 9% rates were eliminated for most goods, leaving only the 11% reduced rate.
 
VAT Exemption Threshold

The exemption threshold was updated for 2025 to RON 395,000 per year.

What does this mean?

If your company’s turnover does not exceed RON 395,000, you can benefit from the special VAT exemption regime.
  • You will not be required to apply VAT on issued invoices, but you also cannot deduct VAT on purchases.
     
Practical examples:
  • Company A: Turnover = RON 380,000 → remains under the exemption regime, no VAT applied on invoices.
     
  • Company B: Turnover = RON 400,000 → must register for VAT and apply the standard 21% rate on issued invoices.
     
VAT on Housing

In 2025, a reduced 9% VAT rate applies to certain housing deliveries:
  • For homes delivered to municipalities for allocation as subsidized rent for low-income individuals.
     
This measure has a social and fiscal purpose, supporting access to housing.
 
Transitional Rules and Alerts
  • If you exceed the threshold during the year, VAT registration must be done immediately once the limit is surpassed.
     
  • It is recommended to monitor turnover monthly, especially if you are close to the threshold.
     
  • VAT must be correctly applied to each invoice issued, otherwise you risk penalties or fines from ANAF
 
VAT Calculation Examples
 
Example 1 – Standard rate 21%

Invoice amount: RON 1,000
VAT applied: 1,000 × 21% = RON 210
Total payable: RON 1,210
Example 2 – Reduced rate 11%

Invoice amount for accommodation services: RON 500
VAT applied: 500 × 11% = RON 55
Total payable: RON 555
These calculations are simple, but errors often occur when the types of goods or services are not differentiated.
 
Risks if VAT is applied incorrectly
  • ANAF fines and penalties
     
  • Potential audits and fiscal adjustments
     
  • Loss of VAT deduction rights
     
  • Disputes with partners or clients
     
Practical Recommendations
  • Update your invoicing software with the new VAT rates
     
  • Monitor your turnover to know exactly when you exceed the exemption threshold
     
  • Keep all invoices and tax declarations for at least 10 years for safety
     
  • Consult a tax specialist before making major changes to your invoicing system
     

If you want to be sure you are applying VAT correctly in 2025, our team of tax consultants is ready to help:
  • We analyze your company’s situation
  • We guide you to apply VAT rates correctly
  • We provide recommendations for legal tax optimization
  • We monitor the exemption threshold together to avoid unpleasant surprises
     
contact@financess.ro
(+40) 749 097 969