Key facts in 10 lines
- Corporate income tax is 10% flat (CITA Art. 20); personal income tax is 10% flat (PITA Art. 48).
- Dividends to individuals are taxed at 5% withholding (CITA Art. 194); dividends to an EU/EEA parent company are 0% (Art. 194(3)(3)).
- VAT is 20%, with 9% for hotel accommodation and books (VATA Art. 66, 66a); mandatory VAT registration above €51,130 turnover per calendar year (Art. 96).
- Minimum share capital of an EOOD/OOD is €1 (Commerce Act Art. 117); the online state fee is €28.12.
- Registration takes 1 to 2 business days; the Registry Agency must rule by the end of the next working day (CRA Art. 19(2)).
- Foreigners, EU or non-EU, may own 100%; no local director or shareholder is required.
- Social security on salaries totals 32.7% (employer 18.92%, employee 13.78%), including 8% health; a self-insured owner pays 27.8% on at least €620.20, i.e. from €172.42 a month.
- Minimum wage is €620.20; maximum insurable income is €2,300 from 1 August 2026.
- Deadlines: corporate tax return and payment by 30 June; financial statements published by 30 September; dividend tax quarterly.
- Bulgaria uses the euro since 1 January 2026 at the fixed rate 1 EUR = 1.95583 BGN; individual tax residency follows the 183-day test (PITA Art. 4).
Taxes on profit, dividends and income
Bulgaria has had a flat 10% corporate rate since 2007 and a flat 10% personal rate since 2008. Neither has changed with the euro. The combined burden on profit distributed to an individual owner is 10% + 5% of the remaining 90% = 14.5%.
| Item | Value | Legal basis | Last verified |
|---|---|---|---|
| Corporate income tax | 10% flat on taxable profit | Corporate Income Tax Act (CITA), Art. 20 | 7 Sep 2026 |
| Advance instalments | Only if prior-year net sales revenue exceeded €153,388 (BGN 300,000); monthly above €1,533,875 (BGN 3,000,000), quarterly in between | CITA Art. 83, Art. 84, Art. 85 | 7 Sep 2026 |
| Dividend withholding tax (individuals, BG or foreign) | 5% on the gross dividend; a double tax treaty may reduce it for non-residents | CITA Art. 194(1), Art. 200(2); Personal Income Tax Act (PITA) Art. 38(1) | 7 Sep 2026 |
| Dividend to a parent company in the EU / EEA | 0%, no minimum holding or holding period required by Bulgarian law; parent must be tax resident in an EU or EEA state | CITA Art. 194(3)(3); Directive 2011/96/EU | 7 Sep 2026 |
| Dividend to a Bulgarian company | 0%, not treated as taxable revenue of the recipient | CITA Art. 27(1)(1), Art. 194(3)(1) | 7 Sep 2026 |
| Personal income tax | 10% flat (sole traders 15%; freelancers 10% after a 25% standard expense deduction) | PITA Art. 48; Art. 29(1)(3) | 7 Sep 2026 |
| Tax on expenses | 10% on representation expenses, certain social benefits and personal use of company assets | CITA Art. 204 | 7 Sep 2026 |
| Interest limitation (ATAD) | Net borrowing costs deductible up to 30% of tax EBITDA when they exceed €1,533,875 (BGN 3,000,000); thin-cap 3:1 test under Art. 43 | CITA Art. 43a; Art. 43 | 7 Sep 2026 |
| Controlled foreign company (CFC) rule | Applies when a Bulgarian company holds more than 50% of a low-taxed foreign entity; that entity's undistributed profit is added to the Bulgarian tax base | CITA Art. 47c to 47e (Chapter 9a) | 7 Sep 2026 |
| Loss carry-forward | 5 consecutive years | CITA Art. 70 | 7 Sep 2026 |
VAT
A Bulgarian company with EU business customers usually needs a VAT number even below the €51,130 threshold, because Art. 97a registration is triggered by the first intra-EU B2B service. That registration alone does not give a right to deduct input VAT; full registration under Art. 96 or Art. 100 does.
| Item | Value | Legal basis | Last verified |
|---|---|---|---|
| Standard VAT rate | 20% | VAT Act (VATA) Art. 66(1) | 7 Sep 2026 |
| Reduced VAT rate | 9%: hotel and similar accommodation (incl. campsites); books, newspapers and periodicals in printed or electronic form | VATA Art. 66a | 7 Sep 2026 |
| Mandatory registration threshold | €51,130 (BGN 100,000) taxable turnover in a calendar year; application within 7 days | VATA Art. 96(1) | 7 Sep 2026 |
| Voluntary registration | Any turnover, on application; once registered, monthly returns are due even at zero | VATA Art. 100 | 7 Sep 2026 |
| Services to / from EU businesses | Registration under Art. 97a before the first supply or receipt, regardless of turnover; no right to deduct input VAT on this registration alone | VATA Art. 97a | 7 Sep 2026 |
| Intra-EU B2B services | Reverse charge: the Bulgarian supplier invoices without VAT, reports the sale in the VIES declaration; the EU customer self-accounts | VATA Art. 21(2); Art. 125(2) | 7 Sep 2026 |
| EU distance sales to consumers (OSS) | €10,000 EU-wide threshold; above it VAT of the customer's country applies, reported via the One Stop Shop | VATA Art. 20; Directive (EU) 2017/2455 | 7 Sep 2026 |
| Filing and payment | VAT return, purchase and sales ledgers and VIES declaration by the 14th of the following month | VATA Art. 125(5); Art. 89(1) | 7 Sep 2026 |
| VAT number format | BG + 9-digit UIC (EIK), e.g. BG123456789 | VATA Art. 94(2) | 7 Sep 2026 |
Company formation: capital, fees, timing
| Item | Value | Legal basis | Last verified |
|---|---|---|---|
| Legal forms for a small business | EOOD (single-member LLC) or OOD (LLC with two or more shareholders); both are limited-liability companies | Commerce Act (CA) Art. 113, Art. 147 | 7 Sep 2026 |
| Minimum share capital | €1 (paid into a bank capital account before filing) | CA Art. 117(1) | 7 Sep 2026 |
| Foreign ownership | 100% allowed for EU and non-EU individuals and companies; no local shareholder required | CA Art. 113; Commercial Register Act | 7 Sep 2026 |
| Local director requirement | None. The manager can be a foreign national living abroad | CA Art. 141 | 7 Sep 2026 |
| State fee for registration | €28.12 online with a qualified e-signature or through a lawyer/agent (€56.24 on paper) | Tariff of state fees collected by the Registry Agency, Art. 16a (euro version, Jan 2026) | 7 Sep 2026 |
| Registration timing | The Registry Agency rules on first-registration applications by the end of the next working day; in practice UIC (EIK) issued in 1 to 2 business days | Commercial Register and Register of NPLE Act (CRA) Art. 19(2) | 7 Sep 2026 |
| Registered address | A Bulgarian address is mandatory; it may be a virtual-office address | CA Art. 12; CRA Art. 13 | 7 Sep 2026 |
| Remote incorporation | Documents signed before a notary abroad with an apostille, at a Bulgarian consulate, or with a qualified electronic signature; no visit required | CRA Art. 15; Hague Apostille Convention | 7 Sep 2026 |
| Statutory audit | Not required for micro and small companies below the size thresholds of Art. 37 Accountancy Act | Accountancy Act (AA) Art. 37 | 7 Sep 2026 |
Step-by-step: company formation · register an EOOD · remote setup checklist.
Annual and monthly deadlines
| Obligation | Deadline | Legal basis | Last verified |
|---|---|---|---|
| Corporate tax return and payment | 1 March to 30 June of the following year | CITA Art. 92(2), Art. 93 | 7 Sep 2026 |
| Annual financial statements published in the Commercial Register | 30 September of the following year | AA Art. 38(1) | 7 Sep 2026 |
| No-activity declaration (dormant company) | 30 June of the following year; replaces the financial statements; no state fee | AA Art. 38(9)(2) | 7 Sep 2026 |
| Dividend tax declaration and payment | Quarterly: by the end of the month following the quarter in which the distribution was decided | CITA Art. 201(1), Art. 202(2); PITA Art. 55(1), Art. 65(2) | 7 Sep 2026 |
| VAT return and VIES | 14th of the following month | VATA Art. 125(5) | 7 Sep 2026 |
| Payroll and social security | 25th of the following month | Social Insurance Code Art. 7 | 7 Sep 2026 |
| Annual personal income tax return (owner as individual, if required) | 30 April of the following year; 5% discount if filed by 31 March | PITA Art. 53(1), Art. 53(6) | 7 Sep 2026 |
Missing the 30 June no-activity declaration means the company must publish full financial statements by 30 September instead. Details: dormant EOOD annual cost.
Euro, tax treaties, residency
| Item | Value | Legal basis | Last verified |
|---|---|---|---|
| Euro adoption date | 1 January 2026; the euro is the only legal tender after the two-week dual-circulation period | Law on the Introduction of the Euro in the Republic of Bulgaria; Council Decision of 8 July 2025 | 7 Sep 2026 |
| Conversion rate | 1 EUR = 1.95583 BGN, fixed and irrevocable; all thresholds in law converted at this rate | Council Regulation (EU) 2025/1409 amending Regulation (EC) No 2866/98 | 7 Sep 2026 |
| Double tax treaties | About 70 conventions in force (69 per published lists) ‹verify exact count›, incl. all EU states, UK, USA, Canada, Switzerland, UAE, India, China | Ministry of Finance (minfin.bg), NRA (nra.bg) | 7 Sep 2026 |
| Individual tax residency | Permanent address in Bulgaria, or more than 183 days of presence in any 12-month period, or centre of vital interests in Bulgaria; owning or managing a company is not a test | PITA Art. 4(1), Art. 4(5) | 7 Sep 2026 |
| Company tax residency | A company registered in Bulgaria is a Bulgarian tax resident; a foreign state may still claim it under a treaty if effective management is there | CITA Art. 3; OECD Model Art. 4(3) | 7 Sep 2026 |
How the 5% dividend tax interacts with tax at home: extracting profits as a non-resident owner.
Typical annual cost of a small Bulgarian company
Fixed compliance cost, before any taxes on profit, at Bulsmetka's published 2026 prices (excl. VAT). A company with no VAT registration and no employees beyond the owner spends about €2,080 in year 1 and €1,800 in every following year. With VAT registration add €360 a year.
| Cost item | Amount | Note | Details |
|---|---|---|---|
| Company formation (documents, state fee €28.12, notary, capital account) | €280 | One-off, year 1 only | page → |
| Monthly accounting subscription (up to 30 documents, 2 insured persons) | €150 x 12 = €1,800 | Includes annual closing, financial statements, corporate tax return, payroll | page → |
| VAT-registered surcharge (if registered) | +€30 x 12 = €360 | Monthly VAT return, ledgers, VIES | page → |
| Annual closing | €0 | Included in the subscription; €120 stand-alone for a dormant company | page → |
| Registered address (if you have no Bulgarian address) | Set by the provider | Not included; ask for a written quote | page → |
| Bank account fees | Set by the bank | Capital account approx. €10 to €20 one-off; operating account per tariff | page → |
Full worked example with taxes on €60,000 revenue: what a Bulgarian company really costs in 2026. Price list: pricing.
Who a Bulgarian company is for, and who it is not for
A good fit
- Remote service businesses invoicing EU or non-EU clients from an EU entity with a 10% profit tax.
- Founders who need an EU VAT number and VIES-listed company quickly and at low cost.
- Holding or IP-owning companies receiving dividends from EU subsidiaries at 0%.
- Owners who will relocate to Bulgaria or already spend more than 183 days there.
- E-commerce sellers using OSS from one EU base.
Not a good fit
- Owners who will manage the company entirely from a country that taxes companies by place of effective management and will not accept a Bulgarian address as substance.
- Anyone expecting to avoid tax at home on dividends: the 5% is usually credited, not the end of the story.
- Businesses that need a Bulgarian bank account opened in days; for non-residents it is weeks, with enhanced due diligence.
- Freelancers with income below roughly €30,000 and no EU clients, where freelancer status is cheaper.
- Regulated activities (financial services, gambling, crypto exchange) that need licences beyond a simple registration.
Compare structures: legal forms comparison · freelance vs EOOD for non-residents.
Frequently asked questions
What is the corporate tax rate in Bulgaria in 2026?
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10% flat on taxable profit under Art. 20 of the Corporate Income Tax Act. There is no progressive scale and no separate local profit tax. The annual return is filed between 1 March and 30 June of the following year.
How much tax does an owner pay on dividends from a Bulgarian company?
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5% withholding on the gross dividend, whether the owner is a Bulgarian or a foreign individual (Art. 194 CITA, Art. 38 PITA). Dividends paid to a company resident in another EU or EEA state are exempt under Art. 194(3)(3). A double tax treaty may set a lower rate for individuals.
What is the minimum share capital of an EOOD or OOD?
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€1 under Art. 117 of the Commerce Act. The capital is deposited in a bank capital account before filing. Most founders choose €50 to €500 so the balance sheet does not open with a single euro.
What is the VAT registration threshold in Bulgaria in 2026?
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€51,130 (BGN 100,000) of taxable turnover in a calendar year (Art. 96 VAT Act). The application must be filed within 7 days of crossing it. Voluntary registration is possible at any turnover under Art. 100. Companies buying or selling services to EU businesses register under Art. 97a before the first supply.
What are the annual deadlines for a Bulgarian company?
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30 June: corporate tax return (Art. 92 CITA), payment of the tax, and the no-activity declaration for dormant companies (Art. 38(9)(2) Accountancy Act). 30 September: publication of the annual financial statements in the Commercial Register (Art. 38(1) Accountancy Act). Dividend tax is declared and paid quarterly, by the end of the month following the quarter.
Does owning a Bulgarian company make me a Bulgarian tax resident?
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No. Tax residency of an individual is decided by Art. 4 of the Personal Income Tax Act: permanent address, more than 183 days of presence in any 12-month period, or centre of vital interests in Bulgaria. Owning shares or being the registered manager is not one of the tests.
Sources
- Corporate Income Tax Act (ЗКПО), Art. 20, 27, 43, 43a, 47c to 47e, 70, 83 to 85, 92, 93, 194, 200 to 202, 204
- Personal Income Tax Act (ЗДДФЛ), Art. 4, 29, 38, 48, 53, 55, 65
- VAT Act (ЗДДС), Art. 20, 21, 66, 66a, 89, 94, 96, 97a, 100, 125
- Accountancy Act (ЗСч), Art. 37, 38
- Commerce Act (ТЗ), Art. 113, 117, 141, 147
- Commercial Register and Register of NPLE Act (ЗТРРЮЛНЦ), Art. 13, 15, 19
- Registry Agency: tariff of state fees (euro version)
- Social Insurance Code (КСО); State Social Insurance Budget Act 2026; NHIF Budget Act 2026; noi.bg
- NRA: VAT in Bulgaria; NRA: withholding tax
- Bulgarian National Bank: euro changeover; Council Regulation (EU) 2025/1409 (conversion rate 1.95583)
- Directive 2011/96/EU (parent-subsidiary); Ministry of Finance: double taxation conventions
Verified on 7 September 2026.
Important
Bulsmetka is a private accounting firm in Sofia, not a government authority. The information is general in nature and does not replace individual advice. Figures apply to 2026 and are converted from leva at the fixed rate where the law still quotes leva. Tax treatment in your country of residence is outside the scope of this page. State fees are invoiced at cost.
Social security and health insurance 2026
The 2026 State Social Insurance Budget Act was adopted in July 2026, so two sets of minimum and maximum figures apply within the year. Rates did not change. Breakdown of the 32.7% on employment income: pensions 14.8%, universal pension fund 5%, sickness and maternity 3.5%, unemployment 1%, work accident 0.4% to 1.1% (employer only), health 8%.
A non-resident owner who does not physically work in Bulgaria is not automatically a self-insured person here; under Regulation (EC) 883/2004 an EU citizen is insured in one member state only. Check your case before assuming the €172.42 applies. Run the numbers in the social security calculator.