Good news for IT employees in Romania starting in January 2023
Starting in January 2023, IT employees in Romania have received good news. The government has made an important decision to extend the income tax exemption for these employees through a new joint order signed by the Ministries of Research, Education, Labor, and Finance.
This measure applies to the income for the month of January 2023 and replaces, with some modifications, the old rules of income tax exemption for IT employees.
Among the changes are:
- Introducing a new occupation on the list of those targeted by the income tax exemption – software development engineer.
- Extending the categories of people who can benefit from this exemption (graduates of secondary education who have passed the high school examination and are students at accredited universities) and the possibility that employees with equivalent or recognized diplomas from the Ministry of Education can benefit from this exemption.
- Public institution employees who create computer programs can benefit from these exemptions.
- One of the most important aspects of the new income tax exemption for IT employees is that now it replaces the mention of „Romanian citizens and European Union citizens” with “employees”. Which now means that, non-European citizens who have an equivalent or recognized diploma by the Ministry of Education can benefit from this income tax exemption too.
To benefit from these exemptions, employees must meet certain conditions, such as working for economic operators who carry out their activities on the territory of Romania in accordance with current legislation and whose object of activity is the creation of computer programs (CAEN codes 5821, 5829, 6201, 6202, 6209).
Also, employees must be part of a specialized computer science department highlighted in the employer’s organizational chart and have one of the functions mentioned in the order:
- database administrator,
- system engineer in computer science,
- software system engineer,
- computer project manager,
- designer of computer systems,
- computer system programmer,
- assistant programmer,
- assistant analyst,
- software development engineer.
Another condition for the application of the tax exemption is that the employer must have achieved in the previous fiscal year income from the creation of computer programs, which have a value of at least 10,000 euros for each employee. Exceptions are newly established companies and public institutions.
This is an important step in attracting and retaining foreign talent in the IT field in Romania and can have a positive impact on the country’s economy. This will allow companies to attract professionals with valuable experience and skills from around the world, which will improve competitiveness and stimulate economic growth.
Furthermore, this will encourage IT employees, even more, to continue their education and obtain internationally recognized diplomas, which will improve the quality of the workforce in the field.
Overall, the decision taken shows a positive attitude of the government towards the development and attraction of talents in the IT field, which could have a positive impact on the economy and society.
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