Romania: New grants for teleworking workers and improve to nationwide minimal wage

Non-taxable teleworking assistance

From January 1, 2021, employers can provide grants to teleworkers to cover utilities’ expenses (such as electricity, heating, water, data subscription) and the purchase of office furniture and equipment. This grant, if granted, should be included in the monthly payroll. The main points to note are that the grant:

• arguably not mandatory, but further analysis needs to be carried out (in line with developments in labor law);
• paid only by the employer with no government support available;
• is deductible for corporation tax purposes;
• is a non-taxable benefit of up to RON 400 gross (approx. EUR 80) per month – a maximum of RON 400 is therefore also the net income of the employees;
• does not require documentary evidence from staff;
• Requires that the non-taxable threshold be correlated / proportionate to the actual number of days the employee teleworks; and
• may be subject to different limit values ​​set by the employer in his internal regulations or in the employment contracts, but at least 400 RON gross are not taxable.

The implementation of the teleworking system must be documented in accordance with the specific legislation in order for an employer to apply the more favorable tax treatment in relation to grants to employees.

Other tax implications / exemptions

As of January 1, 2021, all expenses by employers related to epidemiological tests and vaccinations of workers aimed at stopping the spread of diseases will be exempt from income tax and social security contributions.

Increase in the national wage

The Romanian government plans to increase the national standard minimum gross monthly salary for all sectors from 2,230 RON (approx. 460 EUR) to 2,300 RON (approx. 480 EUR). In the meantime, the monthly national minimum gross salary (for employees with a university degree and at least 1 year of service) remains unchanged at 2,350 RON (approx. 490 EUR).