If you’re contracting in Romania, you’ll eventually face the question: PFA or SRL?
This guide is not a replacement for an accountant and it won’t tell you a universal “best choice”. Instead, it gives you a decision framework, common IT scenarios, and a checklist of what to calculate before you commit.
TL;DR
- Choose PFA when you want simplicity, your expenses are relatively low, and you don’t want heavy admin overhead.
- Choose SRL when you want flexibility (expenses, hiring/subcontractors, cashflow control), you accept more admin, and you prefer separating business vs personal money.
- Don’t decide from hearsay—run real scenarios and write down your assumptions.
2026 changes to keep in mind
- Dividend tax is 16% for dividends distributed starting 1 Jan 2026.
- Standard VAT is 21% and reduced VAT is 11% (verify applicability).
- Minimum wage used for thresholds is 4,050 RON until an official 2026 update is published.
Who this is for
- People moving from CIM (employment) to B2B and trying to avoid a wrong setup.
- Contractors who already invoice and want a cleaner long-term structure.
- Anyone trying to connect PFA/SRL decisions with VAT, invoicing, and cashflow reality.
Before you decide: 4 questions that clarify most cases
1) Do you want simplicity or flexibility?
PFA tends to be simpler (fewer moving parts). SRL tends to be more flexible, but it requires discipline (documents, process, and usually a tighter relationship with accounting).
2) What do your real expenses look like?
Not just “laptop + internet”. Include:
- accounting
- tools/subscriptions
- equipment and licenses
- travel and coworking
- training/certifications
Expenses are more than a number: they also shape how much admin effort you’re willing to do.
3) Do you need credibility / structure for certain clients?
Some clients (especially corporate) prefer SRL and more formal processes (POs, SLAs, compliance). If you target those clients, don’t ignore this criterion for a small tax delta on paper.
4) Are you optimizing short-term net or long-term predictability?
A higher net in an optimistic scenario doesn’t help if:
- you have months without invoices
- payments are delayed
- your fixed costs are underestimated
That’s why you should run at least two scenarios: conservative and optimistic.
How to use the calculator (so you get useful output)
Use the PFA vs SRL calculator (2026).
- Enter a realistic annual income (not a best-case number).
- Pick an expense level that matches your real workflow.
- Select goals (simplicity vs optimization vs growth/credibility).
- Run at least twice:
- conservative scenario (lower income + buffer)
- optimistic scenario (higher income + real expenses)
Important: the calculator is an estimator (not a full fiscal engine), but it’s enough to reveal direction and sensitivity: “for me, do expenses matter more than revenue?”
Common IT contractor scenarios (and what to watch)
Scenario 1: “Solo dev, low expenses”
Signal: you mostly sell time, your recurring costs are low, and you want minimal admin.
Watch:
- net delta between PFA and SRL at your revenue level
- resilience to “one month without invoices” (buffer planning)
Scenario 2: “Consultant with recurring costs”
Signal: training, certifications, paid tools, travel, coworking, frequent equipment.
Watch:
- whether SRL flexibility helps your real workflow
- whether you can keep documentation/process clean
Scenario 3: “You want to scale (subcontractors / small team)”
Signal: you plan to collaborate with other contractors or hire.
Watch:
- how easy it is to handle multiple contracts and recurring payouts
- cashflow (invoices, terms, buffers)
Scenario 4: “Corporate processes / external clients”
Signal: POs, 30/60-day terms, compliance requirements.
Watch:
- invoicing and documents (invoice, proforma, estimate)
- whether e-Factura enters your workflow and how often you’ll handle XML
Checklist: data to gather before deciding
- Annual income estimate (conservative + optimistic)
- Expense estimate (by categories, not a single %)
- Risk buffer (months without invoices / delayed payments)
- Target client profile (startup vs corporate, RO vs external)
- Personal preference: simplicity vs optimization vs growth
Related tools (to complete the picture): sanity-check VAT with the VAT calculator (2026), generate documents with the invoice generator, proforma generator, and estimate generator, track billable time with the timesheet, and set pricing using the freelancer hourly rate calculator.
Common mistakes (that cost time and money)
- Picking based on someone else’s case (different revenue/expenses).
- Ignoring admin time: “taxes are X so pick Y” while losing hours monthly to process.
- Not modeling the conservative scenario (lower income + one month without invoices).
- Not clarifying VAT in pricing, creating late negotiation friction.
- Discovering e-Factura only after the client asks for XML.
FAQ
Can I switch from PFA to SRL later (or the other way around)?
Yes, but switching has costs and implications. Aim for a structure that supports your next 12–24 months.
How does VAT relate to PFA vs SRL?
VAT is largely separate from legal form, but it affects cashflow and how you communicate pricing. See VAT for IT contractors in Romania (2026).
What should I do next if I pick PFA?
Understand taxes and the filing workflow in PFA taxes + “Declarația Unică” (2026): practical overview.
Next steps
Run 2–3 scenarios in the PFA vs SRL calculator (2026), then connect it to your real workflow: if you invoice clients, read Invoice vs proforma vs receipt (Romania): when to use each. If e-Factura is in your pipeline, follow RO e-Factura: a practical guide (XML, validation, and PDF preview).
Sources
- Law 141 (2025) (tax updates incl. dividend tax): https://legislatie.just.ro/Public/DetaliiDocument/302804
- Government Decision 1506 (2024) (minimum wage): https://legislatie.just.ro/Public/DetaliiDocument/293933
- ANAF: https://www.anaf.ro/
