In brief
The Romanian Civil Code allows a property to be split into two parts: the children receive the bare ownership (nuda proprietate), and the parents retain a usufruct (uzufruct) that allows them to live in the property, let it and enjoy its fruits. The split is made by notarial deed and exists only from the moment of registration in the land register. On the death of the usufructuary the right ends of its own accord, and the children become full owners without an inheritance procedure for this right.
Key takeaways
- 1A usufruct held by a person lasts at most until the end of their life, and one held by a company up to 30 years (Article 708 of the Civil Code).
- 2The usufructuary may live in the property and let it (Articles 709 and 715); major repairs such as the roof and structure fall on the bare owners (Article 729).
- 3The split requires a notarial deed, and the right is acquired only on registration in the land register (Articles 1244 and 885(1)).
- 4In the absence of a sufficient declared value, the tax is set on 20% of the notaries' minimum value for a usufruct, and on 80% for bare ownership (Article 111(4^1) of the Tax Code).
- 5A sale to a descendant with a reserved usufruct is deemed a gift until proven otherwise, so it does not circumvent the reserved share of other heirs (Article 1091(4)).
Parents who hold a property in Romania often ask how to ensure the house passes to their children, without waiting for an inheritance procedure in a foreign country, and without giving up the option of living in it. Romania has a recognised and well-regulated legal tool for this: splitting ownership into bare ownership and usufruct.
We wrote about the gift itself, the exemption from transfer tax and the tax clock on sale in a separate guide on gifting a property to children. Here we focus on the split structure: what each side may do, who bears the costs, how it is registered, and what can go wrong.
What is a split into bare ownership and usufruct?
It is a division of ownership into two parts held by different people. Under Article 703 of the Romanian Civil Code, usufruct (uzufruct) is the right to use another's property and enjoy its fruits like an owner, provided the substance of the property is preserved. Whoever holds the ownership without the usufruct holds nuda proprietate, bare ownership.
In practice: the children are registered as owners already today, the parents continue to live in the house and manage it, and on the parents' death the right lapses and the children remain full owners (Article 746).
The usufructuary may live in the property and let it (Articles 709 and 715); major repairs such as the roof and structure fall on the bare owners (Article 729).
What may the parents do, and what remains with the children?
| Question | The usufructuary | The bare owners | Article |
|---|---|---|---|
| Who lives in the property | Exclusive use, unless otherwise agreed | No, as long as the right exists | 709 |
| Letting to a third party | May let | No | 715 |
| Transferring the usufruct to another | May do so, if the contract does not prohibit it; the right will still end on the death of its original holder | Not relevant | 714 |
| Selling the whole property | Signs together with the bare owners | Sign together with the usufructuary | Each holds a different right |
Alongside the rights there are also obligations. The usufructuary must preserve the use of the property and compensate for damage caused by improper use (Articles 724 and 725). At the same time, Article 747 allows the bare owners to ask the court to end the right when its holder damages the property or neglects it.
Who pays for repairs, insurance and charges?
- Routine maintenance: the usufructuary (Article 729(1)).
- Major repairs: structure, roof, walls, electrical, heating and plumbing systems, fall on the bare owners, unless the need arose from neglect of maintenance (Article 729(2) to (4)).
- When the owners do not repair: the usufructuary notifies them of the need. If they did not repair in time, the usufructuary may carry out the repair and they must reimburse the amount by the end of the year (Article 730).
- Insurance: if the property is insured, the usufructuary pays the premiums (Article 733(2)).
- Costs and charges of ownership: the bare owners (Article 735).
Within a family this division sounds technical, but it is a real question when the roof leaks and the children live in Israel. It is advisable to agree in advance, in writing, who actually takes care of things.
How long does the usufruct last, and how does it end?
Article 708 sets the ceiling: for a person at most until the end of their life, and if no term was set the right is presumed to be for life. For a company the ceiling is 30 years, and a longer term is reduced automatically. A right granted “until a certain person reaches a certain age” lasts until that date, even if the person dies earlier.
Article 746 lists the ways it ends:
- Death of the holder of the right.
- End of the term that was set.
- Merger of both parts in the same person.
- Waiver.
- Non-use for 10 years.
Usufruct or right of habitation: which suits you?
The code also recognises a narrower right, the right of habitation (abitație). Its holder may live in the house with their spouse, children, parents and dependants (Article 750), but may not transfer it to another or let the house (Article 752). For parents who only want to live there, a right of habitation may suffice. Parents who also want to keep the option of letting and receiving the rent need a usufruct.
How is the split created and registered?
- Notarial deed. An agreement creating a real right registered in the land register must be notarial, otherwise it is void (Article 1244). A gift requires a notarial deed in any case (Article 1011).
- Wording for both parents. When the right is reserved for both of you, ask for the wording to provide that the surviving parent continues to hold the right in full.
- Registration in the land register (carte funciară). A real right in immovable property is acquired only on registration, even between the parties themselves (Article 885(1)). Without registration there is no usufruct.
- Extract after registration. It should show the children as bare owners and the parents as usufructuaries.
- Removal when the time comes. When the right ends by death or at the end of the registered term, it is removed without the need for its holder's consent (Article 885(2)): an application and a death certificate suffice.
The notarial deed and the registration are carried out by a notary and a lawyer licensed in Romania. Someone who does not attend can act through a notarial power of attorney.
How much tax is paid in Romania on the split?
Article 111 of the Tax Code (Law 227/2015) applies to the transfer of ownership and also to the creation or transfer of parts of it, such as usufruct and bare ownership. On a sale, the seller pays 3% if the property was held for up to three years, and 1% after three years, as of October 2026.
| Situation | The rule | Source |
|---|---|---|
| Declared value lower than the chamber of notaries' minimum value, creation or transfer of a usufruct | The tax is calculated on 20% of the minimum value | Article 111(4^1) |
| Same situation, ending the usufruct by agreement or waiver | The same 20% basis | Article 111(4^1) |
| Same situation, transfer of bare ownership | The tax is calculated on 80% of the minimum value | Article 111(4^1) |
| Gift between spouses and relatives up to the third degree | Exempt | Article 111(2)(b) |
Two caveats. First, the wording of the exemption speaks of acquiring ownership by gift, so ask the notary for written confirmation that it also applies to the structure you chose, for example a gift of bare ownership with a reserved usufruct. Second, the article mentions ending the usufruct by agreement or waiver, and does not mention ending it by death; confirm the meaning in your case with an accountant. The Israeli aspect of the structure requires a separate review with a tax adviser.
Which pitfalls are worth knowing in advance?
- More than one child. If the inheritance is subject to Romanian law, the spouse, descendants and parents have a reserved share (rezerva succesorală), half of what they would receive without a will (Articles 1087 and 1088). A gift that infringes it may be reduced after the death at the heir's request (Article 1092).
- A “sale” at half price. A sale to a descendant with a reserved usufruct is deemed a gift until proven otherwise (Article 1091(4)), so it does not circumvent the reserved share.
- An existing mortgage. An encumbrance on the property remains on it after the split. Speak with the bank before going to the notary.
- A future sale. The children can sell only the bare ownership, and the buyer will receive a property the parents continue to use. A sale of the whole property requires everyone.
- Minor children. Selling or encumbering a minor's property requires prior court approval.
- Security. Donors who reserved a usufruct for themselves are exempt from providing security, and so is a seller who reserved such a right (Article 726(2)).
What should you do before signing?
Before the notary, decide who holds the right and what happens when one of the parents dies, check whether there is a mortgage, obtain written confirmation from the notary on the exemption and the tax basis, and assess the structure against the whole family's inheritance plan. We accompany Israeli families in this planning and coordinate with the tax adviser, and the notarial deed and registration in the land register are carried out by a notary and a lawyer licensed in Romania.
This article is general information, current as of October 2026, and is not legal or tax advice for a specific case. A split of ownership is hard to undo, and its consequences depend on the family structure and the law that will govern the inheritance.
Frequently asked questions
Can the parents let the house after transferring it to the children?
Yes, if they reserved a usufruct for themselves. Under Article 715 of the Romanian Civil Code, the usufructuary may let. Someone holding only a right of habitation may not let (Article 752).
What happens to the usufruct when the parents die?
It ends of its own accord on the death of its holder (Article 746), and the children, already registered as bare owners, become full owners. The right is removed from the land register on an application and a death certificate, without the need for consent (Article 885(2)).
Who pays for repairing the roof?
The bare owners. The roof, structure, walls and systems are a “major repair” (Article 729), unless the damage was caused by neglect of routine maintenance, which is the usufructuary's responsibility.
Is there tax on a gift of bare ownership to children in Romania?
A gift between relatives up to the third degree is exempt under Article 111(2)(b) of the Tax Code, but the wording of the exemption speaks of acquiring ownership by gift. Ask the notary for written confirmation that the exemption applies to your split structure.
Can the children sell the house while the parents live in it?
They can sell only their bare ownership, and the buyer will receive a property the parents continue to use until the end of their right. A sale of the whole property also requires the parents' signature.
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The information in this guide is general in nature and does not constitute legal or tax advice on any specific transaction. Every transaction is assessed on its own facts.