The Government has adopted a new fiscal instrument aimed at stimulating investment in research and development (R&D), as part of the economic recovery package. The measure introduces a 10% tax credit for eligible innovation-related expenses and is presented as a first in Romanian tax legislation.
Starting in 2026, corporate income taxpayers may apply a new incentive: the tax credit for research and development expenses.
This option was introduced by Government Emergency Ordinance (GEO) no. 6/2026, published in the Official Gazette no. 147 of 25 February 2026.
The existing additional deduction for R&D expenses, as regulated under Article 20 of the Romanian Fiscal Code, remains in force.
In practice, for the determination of corporate income tax or the minimum turnover tax, taxpayers may apply either the existing R&D tax incentive or the newly introduced R&D tax credit.
How does the tax credit work?
The new measure allows taxpayers to choose between the existing R&D tax incentive provided under Article 20 of the Romanian Fiscal Code and the newly introduced tax credit.
The tax credit is set at 10% of the eligible expenses for R&D activities carried out during a fiscal period.
Tax credit = 0.10 × eligible R&D expenses
The resulting amount is deducted from the corporate income tax or from the minimum turnover tax owed by the taxpayer. The final amount is determined at the end of the fiscal year.
According to the Minister of Finance, the mechanism is designed to be applicable and predictable: “Companies will be able to deduct directly from their tax 10% of eligible R&D expenses, and any excess may be recovered in the following years.”
Recovery of amounts and applicable limits
If the value of the tax credit exceeds the tax due in a given year, the difference becomes a tax receivable. It may be offset against outstanding tax liabilities or refunded, under the conditions provided by Law no. 207/2015 on the Fiscal Procedure Code.
Recovery is possible over a period of four consecutive fiscal years. However, certain liabilities are excluded from offsetting, including those related to the additional tax regulated by Law no. 431/2023 on ensuring a global minimum level of taxation for large multinational and domestic groups, as well as withholding tax liabilities.
Offsetting
The tax credit, which may be offset or refunded, is determined at the end of the fiscal year (or modified fiscal year) in which it is calculated. In determining the difference to be offset or refunded, the following are taken into account:
a) The annual corporate income tax represents the annual corporate income tax after deducting, in the following order: foreign tax credit, corporate income tax exemptions under Article 22, corporate income tax exemptions under Law no. 566/2004 (as subsequently amended and supplemented), sponsorship/patronage amounts, and other amounts deductible from corporate income tax under special laws, as applicable.
b) The annual minimum turnover tax represents the annual minimum turnover tax after deducting, in the following order: foreign tax credit and sponsorship/patronage amounts. In the case of a tax group, the annual minimum turnover tax represents the annual minimum turnover tax after deducting the foreign tax credit, sponsorship/patronage amounts, and the amount resulting from applying the 16% rate to the additional R&D deduction, where applicable, if a group member opted to apply the provisions of Article 18^1 para. (11^1).
Refund
The excess tax credit constitutes a tax receivable of the taxpayer and may be used, over the following four consecutive fiscal years (or modified fiscal years), to settle, by offsetting, outstanding tax liabilities representing corporate income tax/minimum turnover tax or other taxes, duties, and contributions, except for the additional tax or the domestic top-up tax regulated by Law no. 431/2023 on ensuring a global minimum level of taxation for multinational enterprise groups and large domestic groups (as subsequently amended and supplemented), as well as withholding tax liabilities established through tax returns submitted by the taxpayer, or it may be refunded under the conditions provided by Articles 167 and 168 of Law no. 207/2015, as subsequently amended and supplemented.
