SOCIAL SECURITY EXPENSES IN ROMANIA
Romania is a competitive country in terms of social contributions of employees and employers. Social security expenses are calculated at the gross monthly salary and are paid to the National Agency for Tax Administration, located in Bucharest.
The calculation of social security expenditures will be profoundly modified as of 1 January 2018 (1) as a reform of the Romanian Tax Code operated a transfer of employers' social expenses to the gross salary. Employers' social contributions will thus be significantly reduced, from 35% to 2.25%.
SOCIAL CONTRIBUTIONS RATE
Here is a table of social contributions of employers and employees starting with 1 January 2018 (1)
Social security expenses
Social state security (CAS) - pension
Social health insurance
Contribution for the payment of sick leave and allowances
Insurance against accidents at work and occupational illness*
Contribution to labour assurance
Commission to the Territorial Labour Inspectorate **
Total social security expenses
The minimum salary in Romania (SMIG (guaranteed minimum inter-professional salary in Romania) was of RON 1,450 gross per month (approximately EURO 320) in 2017. It increased to RON 1,900 (approximately EURO 410) on 1 January 2018.
Salary tax is withheld at a rate of 10%. Nevertheless, employees benefit from a deduction that can vary between RON 510 and 1,210 per month, according to the number of dependents. The deduction is complete if the salary is less than RON 1,950 per month and decreases for salaries spanning between RON 1,951 and RON 3,600.
WHO CONTRIBUTES TO SOCIAL SECURITY IN ROMANIA?
Anyone residing in Romania, regardless whether employed or self-employed, contributes to the general social security system, which protects against the risks of illness, maternity, disability, old-age and death. It should be noted that self-employed workers are covered by disability, old-age and death insurance, provided their average monthly net income exceeds 35% of the average gross salary, i.e. approximately RON 1,096 in January 2017.
In regard to insurance for accidents at work, occupational illness and unemployment, such are compulsory for employees and similar persons. Self-employed workers can join on their own initiative.
In parallel with the general social security system, there are special schemes addressed particularly to notaries and lawyers.
1. In accordance with the Emergency Ordinance of the Government no. 79/2017