Why Bulgaria

10 %corporate income tax (lowest in EU together with Cyprus); 0% for manufacturing companies in areas with high unemployment

Free repatriation of capital

Private judicial executors and notaries

Fast company registration -one to two weeks; online registration

22% of populations hold university degree

35,000 Bulgarian students in Europe. Second largest group after China

5 % withholding tax on dividends and liquidation quotas (0% for EU tax residents holding at least 20% of the Bulgarian company)

Up to 1 year minimum salary and reimbursement of social/health care security for employing young people and disadvantaged people through the Employment Agency

EC membership since 1 January 2007

Treaties for avoidance of double taxation with 61 countries

Bulgarian Taxation

Corporate tax

Corporate Income Tax – 10.00%

Dividend Tax – 5.00%

Withholding tax – 10.00%

Taxes upon some expenses

- Representative expenses – 10.00%

- Social expenses – 10.00%

- Fuel for vehicle – 10.00%

The annual taxable profit must be declared in a tax return on or before 31 March of the following calendar year. The taxable profit is a positive quantity, computed on the basis of the financial result (accounting profit/loss), arrived at as the difference between income and expenditure before assessment of taxes on profit and adjusted according to the procedures established by Chapter Six of CITA. Depreciation expenses are determined to arrive at the taxable profit for tax purposes. The amount of depreciation varies by category of asset and is arrived at by systematic application of the straight-line depreciation method

Value Added Tax

VAT – 20.00%

The new Value Added Tax Act (VATA) came into force on 1 January 2007, the date of accession of Bulgaria to the European Union. The rate of tax is 20%, except for supplies expressly specified in the Act as subject to the zero rate; the rate of tax applicable to hotel accommodation as part of a package tour is 7%.
Registration under VATA is compulsory or optional.
Any taxable person having a taxable turnover of BGN 50,000 or more for a period not exceeding 12 consecutive months preceding the current month is obligated to submit an application for registration to the competent territorial division of the National Revenue Agency (NRA) within 14 days after the end of the tax period during which such turnover has accrued to the person. Notwithstanding the taxable turnover, the registration requirement furthermore applies to any person who is established in another EU Member State, who is not established within the territory of the country and who effects taxable supplies of goods which are assembled within the territory of Bulgaria by or to the account of this person and their recipient is not registered under VATA

Double Taxation Treaties

List of countries, which concluded double taxation treatment with Bulgarian Government: