Workforce Payments Guide Romania

Last updated: Dec 18, 2023

Currency
Mexican Peso (MXN)
Payroll Frequency
Bi-Monthly / Monthly
Capital
Mexico City
Fiscal Year
1 January - 31 December
Employer Taxes
36.69 – 43.72%
Employee Costs
35%
Central Bank
Bank of Mexico (Banco de México)
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3rd Party Payments

Authority  Payment Frequency  Due Date  Payment Method 
Social Security  Monthly  25th day of the month  Romanian State Treasury Elecronic Payment System (RoSTEPS) 
Unemployment Insurance  Monthly  25th day of the month  Romanian State Treasury Elecronic Payment System (RoSTEPS) 
Income Tax  Monthly  25th day of the month  Romanian State Treasury Elecronic Payment System (RoSTEPS) 

Payments Coverage

Papaya Global fully supports workforce payments in Romania.

Contractor Payments

Papaya Global supports payments to contractors in Romania. The payout currency may vary based on the receiver bank account setup when receiving foreign currencies. It is advised for contractors to reach out to their bank to confirm how foreign currencies are handled

Payroll Frequency

Monthly

IBAN

IBAN Example Romania

RO02PORL9719198634357832

IBAN in print

RO02 PORL9 71919 8634 3578 32

Country Code RO
Digit Code 02
Bank code PORL
Account Number 9719198634357832

KYC

The Know Your Customer (KYC) process in Romania involves the identification and verification of customers that businesses interact with. When identifying natural persons, Romanian businesses are required to gather information such as surname, first name, personal identification number, place and date of birth, nationality, and address. They must also understand the purpose and nature of the business relationship with the customer.

For legal entities, businesses must inquire about beneficial owners, which can be direct or indirect. A direct beneficial owner is a natural person who exercises ownership or control over a company by certain criteria. An indirect beneficial owner is a natural person who either owns or controls a foreign company that holds more than 25% of shares of a Romanian company or participates in more than 25% over a Romanian company’s capital.

If there are no persons matching these criteria, the beneficial owner is a natural person who holds a senior management position. The minimum information obtained about the beneficial owner must include: surname, first name, date of birth, nationality, and country of residence.

This process is regulated by the National Bank of Romania’s Regulation no. 2/2019, concerning anti-money laundering and counter-terrorism financing. Romanian credit institutions and their branches, payment institutions, e-money institutions, and non-banking financial institutions registered in the NBR’s Special Register or in NBR’s General Register are obliged to implement these KYC procedures.

They have to identify the source of funds used for operations and provide further information about the ultimate beneficiary owner of the operations. For any transaction valued higher than EUR 15,000, or that implies a transfer of funds higher than EUR 1,000, they must obtain sufficient data about their clients and the respective UBOs.

The KYC process involves real-time verification systems that scan customers’ ID cards and authenticate them.

Primary sources of identification include:

  • identity cards (Carte D’Identite) issued by the Directorate For Persons Record And Databases Management – Ministry of Administration and Interior
  • Romanian Passports issued by Passport General Directorate
  • driving licenses issued by the Romanian Road Authority are the primary sources of identification.

Credit/debit cards are verified and facial recognition systems are used for remote authentication. An address verification service is used to protect businesses from false deliveries and invalid customer locations.

Banking Regulations

The banking regulations that impact cross-border workforce payments in Romania are primarily governed by the European Union’s regulations, specifically Regulation 924/2009 and Regulation 2019/518. Here are some key points:

  • Equal charges: The objective of these regulations is to equalize charges between cross-border payments in euro and the corresponding national payments in the national currency, offered by any payment service provider (e.g., banks) within the EU.
  • No charge limit: A payment service provider may apply any charge it wishes for a cross-border payment in euro, provided that it applies the same charge for a corresponding national payment in the national currency of the Member State in which the payment service provider of the payer is located.
  • Types of payments covered: The Regulation applies to all electronically processed payments, including credit transfers, direct debits, cash withdrawals at cash dispensers (ATMs), payments by means of debit and credit cards, and money remittance.
  • Cross-Border Credit Transfers: For cross-border credit transfers, the International Bank Account Number (IBAN) of the payment recipient should be used by the payer. The cost option used for a credit transfer in euro is SHARE, which means that the payer and the payee will cover the charges applied by their respective payment service providers for sending or receiving the transfer.

Opening Bank Accounts

To open a company bank account in Romania, the following requirements are needed:

1. Mandatory local bank account for companies

2. Identification documents for the representative

4. Articles of incorporation and proof of registration with the Trade Register.

5. If the company is a foreign entity, additional documents may be required, including notarized and apostilled copies of all company documents and proof of registering with the Romanian tax authorities.

6. If the shareholder of the company is another legal entity, the banks usually require the shareholder’s resolution on the establishment of the company.

7. Power of attorney when the submissions are made through a representative.

8. Minimum financial information for bank account opening includes employer’s name/own company’s name, business field, future use for the bank account.

9. Required minimum share capital to be deposited.

10. The fiscal identification number issued by the Romanian authorities can be required in the case of non-residents.

11. Personal presence is mandatory for bank account opening through a locally appointed agent.

The account opening time is usually 1-2 business days. However, for some banks, the account can be opened in just a few minutes and can be started using right away.

There are no mandatory residence requirements.

International Banks

The major foreign banks operating in Romania include:

1. ING Bank NV, Amsterdam – Bucharest Branch

2. BRD – Groupe Societe Generale S.A.

3. Raiffeisen Bank SA

4. UniCredit Bank S.A.

5. HOIST FINANCE AB (PUBL) STOCKHOLM SUCURSALA BUCURESTI

6. Bank of China (Central and Eastern Europe) Limited Secursala Bucuresti

7. BNP Paribas SA Paris Sucursala Bucuresti

8. BNP Paribas Personal Finance S.A. Paris Sucursala Bucuresti

9. Alior Bank S.A. Varsovia- Sucursala Bucuresti

10. TBI Bank EAD Sofia – Sucursala Bucuresti

11. Veneto Banca Spa Italia Montebelluna Sucursala Bucuresti

12. THE Royal Bank of Scotland PLC, Edinburgh, – Sucursala Romania

Major Local Banks

The major local banks operating in Romania are

  • BANCA TRANSILVANIA S.A.,
  • CEC BANK S.A.,
  • EXIM BANCA ROMANEASCA S.A.,
  • LIBRA INTERNET BANK S.A.,
  • Banca Romaneasca S.A.,
  • VISTA BANK (ROMANIA) S.A.,
  • BCR BANCA PENTRU LOCUINTE S.A.,
  • BANCA CENTRALA COOPERATISTA CREDITCOOP,
  • BANCA ROMANA DE CREDITE SI INVESTITII SA,
  • Aedificium Banca pentru Locuinte S.A,
  • TECHVENTURES BANK S.A.,
  • BCR, and BRD.

Payment Tools

The B2C payment tools available in Romania are Visa, Mastercard, American Express, Maestro, Apple Pay, PayPal, online bank transfers (‘pay-by-links’), and cash on delivery (ZebraPay). Other available tools include payment with a single click through a tokenized solution, payment in the marketplace, payment by accessing a link, payment in instalments, and recurring payment.

Cryptocurrency

In Romania, it is possible to pay employees with cryptocurrencies. The transactions with virtual currencies are regulated by Law 30/2019, which introduced provisions in the Romanian Tax Code on taxation of income generated from such transactions. The proceeds from the transfer of virtual currency fall under the category of income from other sources and are subject to a specific tax regime for this category.

Individuals deriving income from these types of transactions have the obligation to declare the income by filing the “Declaratie unica” tax form and pay the income taxes due. The gains from cryptocurrency trades are subject to income tax and the health insurance contribution (CASS), but not to the social security contribution (CAS). A 10% flat rate applies to the gains from virtual currency transactions, and not to the gross income.

Earnings of less than 200 lei/transaction are tax-exempt– i.e., there is no obligation to declare the income, but only if the total earnings in a fiscal year do not exceed the level of 600 lei.

Furthermore, the Romanian Government is taking steps towards the supervision and regulation of personal and professional activities related to blockchain and cryptocurrencies.

The Romanian Criminal Code has classified digital currencies as a “means of payment without cash”. The authorities have the obligation to report suspicious transactions exclusively to the Office if they acknowledge, suspect or have reasonable grounds to suspect that the assets are subject to criminal offences or are related to terrorist financing.

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