Foreign-source income of individuals: obligations, the logic of taxation and avoiding double taxation

In June 2026, ANAF (the Romanian tax authority) publicly reiterated a rule that catches thousands of taxpayers off guard year after year: if you have earned income abroad, in most cases you must also declare it in Romania, even if you have already paid tax in the country where you earned it.¹ This study explains where that obligation comes from, how double taxation is avoided, and why foreign tax authorities share your data with the Romanian tax authority.

1. The origin and logic of taxing foreign-source income

The starting point is not where you earned the money, but where you are tax resident. This is the principle that governs the whole field: Romania, like most countries in the world, taxes residents on the basis of worldwide income, i.e. on all income regardless of source, both from Romania and from abroad.³

Specifically, the following are considered Romanian tax residents and owe tax on income from any source:⁴

• the Romanian individual whose domicile is in Romania;
• the person whose centre of vital interests is in Romania (the place to which personal and economic ties are closest: family, home, employer, business, properties, bank accounts);
• the person present in Romania for more than 183 days in any 12 consecutive months.

The logic is one of equity and neutrality: if two persons live in Romania, have the same ability to contribute and benefit from the same public services, they should contribute equally, regardless of whether one earns income from a local salary and the other from dividends from a Czech company or rent from an apartment in Spain. Taxing only "domestic" income would create an artificial advantage for those who can place their income sources outside the borders and would open a huge loophole for erosion of the tax base.

For this reason, the obligation to declare foreign income does not depend on whether you have already paid tax abroad. The Romanian declaration remains in all cases; what changes is only how much you actually pay here, after applying the double-taxation relief mechanisms.⁵

2. General obligations

2.1. The instrument: the Unique Tax Return (Form 212)

Foreign income is declared through the Unique Tax Return on income tax and social contributions owed by individuals (Form 212). It is entered separately, for each source country and for each type of income, in the chapter dedicated to foreign-source income.⁶ The electronic form allows the selection of the double-taxation-relief method and provides a link to the list of conventions concluded by Romania.

2.2. The deadline: 25 May

The return is filed by 25 May inclusive of the year following the year in which the income was earned, the deadline set by art. 122 of the Fiscal Code. For income earned in 2025, the deadline was 25 May 2026.⁷ The tax due is also calculated and paid by this same deadline.

2.3. Filing methods

• Electronically, through the Virtual Private Space (SPV), ANAF's free service, or through the e-guvernare.ro portal with a qualified digital certificate;
• on paper, at the registry of the competent tax body or by post, with confirmation of receipt.⁸

3. Specific obligations, by category of income

You must declare all categories of income that the Fiscal Code treats as taxable had they been earned in Romania.¹⁰ Among the most frequent:

Taxation is carried out applying the rules of each category of income, as if the income had been earned in Romania. For example, for foreign copyright royalties the 40% flat-rate deduction and the 10% rate apply; for pensions, the non-taxable threshold of RON 24,000/year applies.¹² Income that would be non-taxable or exempt in Romania (e.g. amounts received as inheritance or scholarships) keeps the same treatment when received from abroad.

3.1. The special case of foreign salaries

Here the rule is more nuanced and causes a lot of confusion:

• Salaries received for an activity carried out abroad and paid by a non-resident employer are, in principle, non-taxable in Romania and are not declared (nor do they give rise to a tax credit).¹³
• If the salary is paid by a Romanian employer (or a permanent establishment in Romania) for work performed abroad, the right of taxation depends on the duration of the presence in that state, measured against the period set out in the double-taxation convention (typically 183 days). If the period is exceeded, the right of taxation belongs to the foreign state, but the person, being resident, must still declare the income in Romania (see the example of secondment to Germany, section 5.4).

3.2. Foreign losses

Tax losses incurred abroad (from independent activities, rents, agriculture, securities, etc.) are carried forward and set off only against income of the same nature and source, from the same country, over the next 7 consecutive tax years.¹⁴

3.3. Health contribution (CASS)

In addition to the income tax, certain foreign income (e.g. dividends, interest, rents, capital gains) can trigger the obligation to pay CASS of 10%, if the aggregate of such income exceeds the threshold of 6, 12 or 24 minimum gross monthly salaries per year. For 2025, the reference was the minimum salary of RON 4,050.¹⁵

3.4. Redirecting 3.5% of the tax

The tax related to foreign income (of the same nature as that for which the law allows it) can also be redirected up to 3.5% to non-profit entities or religious establishments, after the tax credit is deducted.¹⁶

4. How double taxation is avoided

The problem is obvious: the same income can be taxed once in the source state (where it was earned) and a second time in Romania (the state of residence). The solution lies in the double-taxation conventions that Romania has concluded with most countries. Each convention provides a "method" for eliminating double taxation, and the Fiscal Code transposes it through art. 131.¹⁷

4.1. The tax-credit method

This is the most common. From the tax due in Romania, the tax paid abroad is deducted for the same income and the same period. The credit, however, has a cap: it cannot exceed the part of the Romanian tax allocable to that income.¹⁸ In practice:

• if the tax paid abroad is higher than the tax due in Romania, you no longer pay anything here (but you do not get the difference back);
• if the tax paid abroad is lower, you pay in Romania only the difference.

The credit is calculated separately for each country and each type of income.

4.2. The exemption method

If, under the convention, the income "may be taxed" in the other state and the prescribed method is exemption, the income is exempt from tax in Romania, but it must still be declared. In Form 212, ticking the exemption method automatically generates "0" for the tax due.¹⁹

4.3. Conditions and documents

The tax credit or the exemption is granted only if, cumulatively:²¹

1. there is a double-taxation convention between Romania and the source state and its provisions apply;
2. the tax was effectively paid abroad, evidenced by a supporting document issued by the foreign tax authority (or by the payer of the income, in the case of withholding at source);
3. the income falls into a category subject to income tax in Romania.

Tax paid in states with which Romania does not have a convention is not taken into account; in such case, the income is fully taxed in Romania, without credit.

4.4. Currency conversion

Foreign-currency amounts are converted into lei at the annual average exchange rate communicated by the National Bank of Romania (BNR) for the year in which the income was earned. For currencies not quoted by the BNR, the amount is first converted into euro/dollars at the source country's rate, then into lei.²²

5. Worked examples

The examples below are built on official ANAF templates (using the 2022 annual average rates, by way of illustration for the mechanism).²³

5.5. From ANAF's administrative practice: sale of NFTs

The frequently-asked questions published by ANAF confirm that the declaration obligation does not turn on the "location" of the platform. In a case published in the tax authority's database, ANAF stated that individuals earning income from the sale of non-fungible tokens (NFTs) on blockchain platforms must declare it in the Unique Tax Return, regardless of whether the income arises in Romania or abroad; the same applies to recurring royalties subsequently earned by the creator. The date the income is earned is the date of the transaction, not the date the cryptocurrency is exchanged for traditional currency.²⁴

6. Why foreign tax authorities share data with Romania

Many taxpayers assume that, if income was received into a foreign account, the Romanian tax authority "has no way of knowing". That assumption has not been valid for almost a decade. A global system of automatic exchange of information is in place, delivering data to ANAF each year on the accounts and income of Romanian residents abroad.

In practice, foreign banks, brokers, funds and insurance companies report to their tax authorities the accounts held by Romanian residents, and those authorities forward the data to ANAF. This is how the tax authority learns about dividends, interest or capital gains earned abroad, and is able to compare that information against what you have (or have not) declared.

7. What happens if you have not declared on time

The ANAF communication of June 2026 describes precisely the regularisation procedure for those who earned foreign income in 2025 and did not report it by 25 May 2026:²⁹

• if you have not filed at all the Unique Tax Return, you can file Form 212 now;
• if you filed the return but without the foreign income, you must file a rectifying return;
• if you receive a notification from ANAF, you can present documents or explanations to clarify the situation before payment obligations are established.

If declaration obligations are not met, the tax authority can assess the taxes ex officio. There is, however, an important safety valve: even after the issuance of an assessment decision, the taxpayer has 60 days to file the Unique Tax Return, in which case the decision previously issued is annulled.³⁰

8. Conclusions

Taxing foreign income is not a "doubling" of the tax, but a natural consequence of the worldwide-income principle: the Romanian tax resident contributes on all their income, wherever earned, and international conventions guarantee that they do not pay twice on the same income. The practical key lies in three reflexes: always declare (even if the final tax is zero), apply the correct method from the convention (credit or exemption) and keep the evidence of the tax paid abroad. In a world where information moves automatically between tax administrations, voluntary compliance has become not only a legal obligation, but also the least costly option.

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