Romania Increases the Non-Taxable Delegation Allowance for Private Entities

As of April 1, 2023, the non-taxable delegation allowance in Romania increased from 20 lei per day to 23 lei per day. This change, introduced by Order 1235/2023, applies to all entities except those of the state. The order also revised the accommodation allowance to 265 lei and the detachment allowance to 23 lei, making business travel somewhat more affordable across the private sector.

The new allowance limits

Private entities can now grant a maximum non-taxable allowance of 57.50 lei per day for each day of delegation. Each company still establishes the actual per diem it grants employees based on its own internal criteria or budget, but that value cannot exceed the 57.50 lei per day ceiling. A second limiting criterion also applies: the allowance is capped relative to the employee's base salary for the job occupied.

How the non-taxable threshold is calculated

Under the Romanian fiscal code, the non-taxable threshold is established as follows:

• In the country, 2.5 times the legal level established by government decision for the personnel of public authorities and institutions, within the limit of 3 base salaries corresponding to the job occupied
• Abroad, 2.5 times the legal level established by government decision for the non-taxable delegation allowance for Romanian personnel sent abroad on temporary missions, within the limit of 3 base salaries corresponding to the job occupied

Why this matters

This revision to the delegation allowance reflects an ongoing effort by Romanian authorities to keep business travel costs manageable for private companies and their employees. Employers sending staff on delegation should factor the updated 23 lei per day base rate, the 57.50 lei per day non-taxable ceiling, and the accommodation and detachment allowance changes into their travel budgets and payroll calculations going forward.

Sources: Order 1235/2023, Romanian fiscal code