We are an IT company incorporated in Belgium, and we want to hire people in Romania, working from their homes. Who is in charge of the salary income tax and social securities?
A: The salary income tax is due to be reported and paid by the employee.
However, the social charges are due to be reported and paid by the employer unless the parties expressly agree otherwise, according to art: 147, paragraph (13) of the Fiscal Code.
If the reporting party is the employer, the foreign company should register for tax purposes in Romania. EU companies may register directly with the tax authorities without a fiscal representative.
On the other hand, the labour contract with a Romanian resident working in Romania is subject to local labour law, including the legal obligation to register the contracts and all related changes.