Vietnam–RomaniaDouble Tax Agreement
Provides treaty protection for Romanian investors and expats, though the royalties rate is higher than most European treaties.
Important notice. Treaty rates shown are standard rates from published treaty texts. Reduced rates may apply subject to beneficial ownership requirements and other conditions specified in each treaty article. Tax treaty application is technically complex and fact-specific. Consult a qualified tax advisor for your specific situation before relying on these rates.
Withholding Tax Rates at a Glance
Dividends WHT
10%on dividend payments
Interest WHT
10%on interest payments
Royalties WHT
15%on royalty payments
Treaty Signed
1995
In Force Since
1996
Status
Active
Model
OECD-based
What This Means for Expats
Residency Tie-Breaker Rules
Determined by permanent home, vital interests, habitual abode, then nationality.
Practical Context
Romania and Vietnam concluded their DTA in 1995. The 15% royalties rate is higher than many of Vietnam's other European treaties. Romania and Vietnam have historical ties from the communist era. The treaty covers both individuals and companies, with standard provisions for employment income, business profits, and passive income.
Key Treaty Provisions Explained
Dividends
10% capWhen a Vietnamese company pays dividends to a Romania shareholder, Vietnam withholds 10% under this treaty — compared to Vietnam's standard domestic rate which may be higher. This applies to portfolio investors. Substantial shareholders may qualify for even lower rates in some treaties.
Interest
10% capInterest paid by a Vietnamese borrower to a Romania lender is subject to a maximum 10% withholding tax under this treaty. This is relevant for intercompany loans between Romania parent companies and Vietnamese subsidiaries, as well as bonds and other debt instruments.
Royalties
15% capRoyalties paid from Vietnam to Romania for use of IP (patents, trademarks, software, know-how) are capped at 15% withholding tax. This rate applies to all qualifying royalty payments under the treaty.
Frequently Asked Questions
Does Vietnam have a tax treaty with Romania?
Yes. Vietnam and Romania have a Double Taxation Agreement (DTA) that has been in force since 1996. The treaty prevents the same income from being taxed in both countries and sets withholding tax caps on dividends, interest, and royalties.
What is the withholding tax rate on dividends under the Vietnam–Romania DTA?
Under the Vietnam–Romania DTA, the withholding tax on dividends is capped at 10%. Without a treaty, Vietnam's standard domestic WHT rate on dividends paid to foreign entities is generally higher. Always confirm the applicable rate with a tax adviser, as lower rates may apply if specific shareholding thresholds are met.
How does the Romania–Vietnam DTA affect my salary as an expat?
Under Article 15 of the Vietnam–Romania DTA, employment income is generally taxable in Vietnam if you are working in Vietnam. The treaty's tiebreaker rules determine your residency: Determined by permanent home, vital interests, habitual abode, then nationality. If you are a Vietnamese tax resident, your worldwide income may be subject to Vietnam PIT, with a credit or exemption for taxes paid in Romania.
What is a Permanent Establishment (PE) under the Vietnam–Romania treaty?
A Permanent Establishment is a fixed place of business through which a Romania company carries on business in Vietnam. If a PE exists, Vietnam can tax the profits attributable to it. Common PE triggers include offices, branches, factories, construction sites lasting more than 6 months, and dependent agents. Romania companies operating in Vietnam should assess PE risk carefully.
Get Tax Advice for Vietnam
Whether you need help with Vietnam PIT filing, applying treaty benefits, or cross-border tax planning, our team is here to help.