As of 1 September 2026, the Social Security Agreement between Romania and the United States of America becomes applicable. For companies assigning personnel across the Atlantic, this is an important development: the Agreement determines the country in which social security contributions are due and allows insurance periods to be aggregated for the purpose of qualifying for a pension. Its main objective is to prevent double social security contributions in respect of the same activity, while ensuring that periods worked in the other country are not lost.

What the Agreement addresses and what remains outside its scope

The Agreement has two distinct components. First, it coordinates the legislation applicable to individuals working in Romania and the United States. Second, it allows insurance periods to be totalised where an individual does not qualify for a pension based solely on the insurance record completed in one country.

From a Romanian perspective, the rules on applicable legislation cover the social security contribution (CAS) and expressly include the legislation governing the health insurance contribution (CASS). The inclusion of CASS concerns the determination of the applicable contribution system and does not, in itself, automatically grant access to all healthcare services in the other country.

The work insurance contribution (CAM) is not expressly included within the material scope of the Agreement. Consequently, a certificate of coverage should not automatically be interpreted as also providing an exemption from CAM; its treatment must be assessed separately under Romanian legislation and the relevant implementation guidance. The Agreement also does not govern income tax. Tax residence, the 183-day rule, the bearing of salary costs and the existence of a permanent establishment remain separate matters to be analysed under the Romanian Fiscal Code and the Romania-US Double Tax Treaty.

General rule: contributions are due in the country where the work is performed

According to Accace tax experts, as a general rule, the determining factor is the place where the activity is physically performed. An employed or self-employed person is, in principle, subject only to the legislation of the country in whose territory they work, irrespective of their residence, the country in which the employer is established or the country from which the salary is paid.

Therefore, the mere fact that the salary continues to be paid from the United States does not automatically keep an individual within the US system if the work is performed from Romania. In the absence of an applicable exception and supporting documentation, Romanian rules may apply from the first day of activity in Romania.

Temporary assignment exception: up to five years

The most relevant exception applies to an employee who ordinarily works for an employer in one country and is temporarily assigned by that employer to work in the other country. If the conditions of the Agreement are met, the individual may remain covered exclusively by the social security system of the home country for an anticipated period of no more than five years.

In practice, it is not sufficient for the parties merely to describe the arrangement as a ‘temporary assignment’. The substance of the arrangement and the genuine connection with the employer in the home country must be examined, including:

• whether the employer carries out substantial business activities in the home country;
• whether the assignment is initiated and controlled by the employer for the purpose of a temporary engagement;
• whether the employment relationship and the employer’s authority are maintained throughout the assignment;
• whether the anticipated duration does not exceed five years and there is a genuine expectation that the individual will return.

The Agreement also contains rules for certain situations in which an employee works for an affiliated entity, as well as for self-employed individuals who temporarily transfer a similar activity to the other country. In exceptional cases, the competent authorities may agree on derogations; however, these are not automatic and must be requested and approved.

Remote work from Romania does not automatically qualify as a temporary assignment

According to Accace experts, a particularly sensitive situation arises where an employee of a US company comes to Romania for personal reasons and continues to work remotely. If the move is not initiated by the employer, there is no clearly defined temporary assignment, or the continued fulfilment of the relevant assignment conditions cannot be demonstrated, the five-year exception may not apply.

In such cases, the reason for the move, its duration, the employee’s usual place of work, the duties performed from Romania, any authority to negotiate or conclude contracts, and the manner in which the employer documents the arrangement should be clarified before arrival. The social security analysis must be coordinated with the related payroll and reporting obligations and with the employer’s Romanian tax exposure.

Certificate of coverage: the essential document

Reliance on the exception must be supported by a certificate of coverage issued by the institution of the country whose legislation continues to apply. For individuals remaining within the US system, the certificate is issued by the Social Security Administration. It is the functional equivalent of evidence of applicable legislation used under other international systems, but it should not be confused with the European A1 certificate.

As a rule, the certificate should be requested by the employer and, ideally, obtained before the activity in Romania begins. The document specifies the period and legal basis of coverage and constitutes the primary evidence supporting the exemption from contributions in the other country. It does not, however, replace the separate analysis of income tax, CAM, tax registrations or any payroll reporting requirements.

What happens to assignments that have already commenced

For individuals assigned to the other country before the Agreement enters into force, the five-year period begins to run on 1 September 2026. This rule may benefit assignments already in progress, but it does not have retroactive effect: obligations relating to periods preceding the effective date must be assessed under the rules applicable at that time.

Totalisation of insurance periods and payment of pensions

The Agreement also protects pension entitlements. If the periods completed in one country are insufficient to establish entitlement, the competent institution may take into account insurance periods completed in the other country, provided that the periods do not overlap. Each country calculates and pays the portion of the benefit corresponding to the periods completed under its own legislation.

As a general rule, entitlement to a US benefit through totalisation requires at least six quarters of US coverage. For Romania, US insurance periods may be used to complete the required contribution period, while the Romanian pension is calculated proportionally. If the period completed in Romania is shorter than one year and does not independently establish entitlement, Romania is not required to pay a benefit in respect of that period. The Agreement also facilitates the cross-border payment of contributory benefits, within the limits prescribed by each country’s legislation.

What employers should do before 1 September

Companies with Romania-US mobility arrangements should review both new assignments and existing arrangements. In practice, we recommend:

• identifying all individuals who physically work in the other country, including remote workers;
• determining the actual nature of each assignment and documenting its duration, purpose and the relationship with the employer;
• requesting the certificate of coverage as early as possible and retaining it in the payroll file;
• separately analysing CAS, CASS, CAM, income tax and the related reporting obligations;
• monitoring the duration of the assignment and reassessing the position whenever the role, host entity or assignment period changes.

Key take-aways

The entry into force of the Agreement is an important step for professional mobility between Romania and the United States. Its principal benefit is clear: the same activity should not be subject to social security contributions in both countries simultaneously, and insurance periods may be taken into account for pension purposes. Nevertheless, this outcome does not arise merely because the Agreement exists. Based on Accace Romania’s experts’ analysis, correctly classifying the arrangement, obtaining a certificate of coverage, and distinguishing social security contributions from income tax and other local obligations remain essential for reducing tax exposure.

About Accace Romania

Accace Romania was founded in Bucharest in 2007. Understanding the needs of our clients to have all internal processes managed under one umbrella, we have developed into a proactive consultancy and outsourcing partner who bridges the gap between needs and solutions, by combining smart and streamlined technology with an integrated approach. Today, we offer accounting, reporting, payroll, HR administration services, tax and corporate advisory and legal consultancy through an affiliated law firm.

About Accace Group

Accace is a proactive consultancy and outsourcing partner who bridges the gap between needs and solutions. Combining smart and streamlined technology with a holistic approach, we provide an all-round care to clients and consider their matters as our own. With over 800 experts and approximately 2,000 customers, we have vast experience with facilitating the smooth operation and growth of small to large-scale, global businesses.

Accace operates internationally as Accace Circle, a co-created business community of like-minded BPO providers and advisors who deliver outstanding services with elevated customer experience and erase the borders of service delivery. Covering over 60 jurisdictions with more than 7,000 professionals, we support over 80,000 customers, mostly mid-size and international Fortune 500 companies from various sectors, and process at least 800,000 pay slips globally.

For more information about Accace Romania, please visit www.accace.ro. For more information about the Accace Group please visit www.accace.com, and its dedicated page to the business community https://circle.accace.com/.