When an EOOD is the right choice
- ✓A single owner who wants limited liability — unlike a sole trader (ET)
- ✓Freelancers and IT specialists whose turnover makes 10% corporate tax + 5% dividend tax more favourable than taxation under the Personal Income Tax Act
- ✓Online stores and services that will work with companies in the EU
- ✓Foreign nationals who want a Bulgarian company with 100% ownership
Tax burden for an EOOD (2026)
| Tax / contribution | Rate | Base |
|---|---|---|
| Corporate tax | 10% | taxable profit (Corporate Income Tax Act) |
| Dividend tax | 5% | profit distributed to an individual |
| VAT | 20% / 9% | once VAT-registered; mandatory above €51,130 annual turnover |
| Owner's contributions as a self-insured person | 27.8% (31.3% with sickness and maternity cover) | chosen insurable income between €620.20 and €2,300 (from 1 August 2026) |
Work out the monthly contributions with the social security calculator →
EOOD or freelance status — which income level
| Annual income | EOOD (self-insured on minimum + dividend) | Freelance status (25% allowance) |
|---|---|---|
| €20,000 | ≈ €6,510 €4,710 taxes and contributions + €1,800 accounting | ≈ €5,970 €5,250 taxes and contributions + €720 accounting |
| €40,000 | ≈ €9,410 €7,610 + €1,800 accounting | ≈ €10,630 €9,910 + €720 accounting |
| €60,000 | ≈ €12,620 €10,460 + €2,160 accounting with VAT | ≈ €12,610 €11,410 + €1,200 accounting with VAT |
| €80,000 | ≈ €15,520 €13,360 + €2,160 accounting with VAT | ≈ €14,110 €12,910 + €1,200 accounting with VAT |
On these assumptions an EOOD comes out cheaper roughly between €25,000 and €60,000 of annual income. Below €25,000 the company's fixed costs weigh more: the owner's minimum contributions and the more expensive accounting. Above about €60,000 freelance status is cheaper again, because its contributions stop growing at the maximum insurable income and the tax is 10% on 75% of income, while an EOOD pays 10% corporate tax and 5% dividend tax on the whole profit. The company's real costs, the profit you leave in it and limited liability can change the answer, so check it against your own figures.
How it is calculated: annual income with no other costs. Freelance status: 25% statutory expense allowance, contributions of 27.8% on 75% of income but not less than €620.20 and not more than €2,300 a month, tax of 10% on 75% of income minus contributions. EOOD: the owner is insured on the minimum income (27.8% × €620.20 = €172.42 a month), 10% corporate tax on the profit after accounting, 5% tax on the dividend paid out. Accounting at our prices: €150 or €60 a month, +€30 or +€40 once VAT-registered, which is mandatory for both forms above €51,130 of turnover. Insurable income limits are those from 1 August 2026, applied to the whole year.
Steps and timeline
- 1
Details and quote
Company name (3 options), registered address, business activity, capital. Quote on the same day.
- 2
Documents
Articles of association, resolution appointing the director, declarations, specimen signature.
- 3
Filing
You deposit the capital into the capital account; we file application A4 with a QES at the Commercial Register.
- 4
UIC
Entry within 1–2 business days. We notify you and hand over the full set of documents.
After registration
The new EOOD's first obligations: registering the self-insured person with the NRA within 7 days of starting activity (declaration OKd-5), opening an operating bank account, and, if needed, VAT registration and a cash register. Deadlines for the year: Working days 2026. With an accounting subscription we handle all of this at no extra charge.
Frequently asked questions
Can the director be a different person than the owner?
+−
Yes. The owner of the capital appoints a director by resolution; the director can be a different individual, including a foreign national.
Does the owner have to pay social security contributions?
+−
If the owner performs personal work for the company, they must register as a self-insured person on a chosen income between the minimum and maximum insurable income. If they only receive dividends and don't work in the company, social security contributions are not due; an owner who lives in Bulgaria and has no health insurance on any other ground pays the health contribution personally, €24.81 a month (Art. 40(5) of the Health Insurance Act).
Can I bring in a shareholder later?
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Yes — by transferring part of the shares or increasing the capital; the company becomes an OOD. See transfer of shares.
Sources
Commerce Act; Commercial Register and Register of Non-Profit Legal Entities Act; Tariff of State Fees Collected by the Registry Agency; Accountancy Act; Corporate Income Tax Act; Personal Income Tax Act; VAT Act (State Gazette issue 115/30.12.2025); Social Insurance Budget Act for 2026. Verified on 3 September 2026.
Important
Bulsmetka is a private accounting firm, not a government body. Information is general and does not replace individual advice. For company registration, state fees are included in the price.