Bulgaria is a country located in Southeastern Europe, known for its rich cultural heritage and natural landscapes. The country has a well-developed tax system that is aimed at generating revenue for the government and ensuring that individuals and businesses pay their fair share of taxes. The Bulgarian tax system is transparent, simple, and efficient, and the government has implemented measures to make tax compliance easier for individuals and businesses.
Overview of Taxation in Bulgaria
The Bulgarian tax system is based on the principles of transparency, simplicity, and efficiency. There are various types of taxes in Bulgaria, including personal income tax, corporate income tax, value-added tax (VAT), and social security contributions.
Personal Income Tax in Bulgaria
Personal income tax is levied on the income of individuals. The tax rate for personal income tax in Bulgaria is a flat rate of 10%. This rate is one of the lowest in the European Union. Individuals who are resident in Bulgaria for tax purposes are subject to personal income tax on their worldwide income. Non-residents are subject to tax only on income that is earned in Bulgaria.
Corporate Income Tax in Bulgaria
Corporate income tax is levied on the income of companies. The tax rate for corporate income tax in Bulgaria is 10%. This rate is also one of the lowest in the European Union. Companies that are resident in Bulgaria for tax purposes are subject to corporate income tax on their worldwide income. Non-resident companies are subject to tax only on income that is earned in Bulgaria.
Value-Added Tax (VAT) in Bulgaria
Value-Added Tax (VAT) is a tax that is levied on the supply of goods and services. The standard rate of VAT in Bulgaria is 20%. There are also reduced rates of VAT for certain types of goods and services, such as food, medical products, and books.
Social Security Contributions
Social security contributions in Bulgaria are levied on both employees and employers. The contributions are used to fund the social security system in Bulgaria, which provides benefits such as health insurance, pensions, and disability benefits. The contribution rates for employees and employers are currently 17.8% each. If you are a registered freelancer social security payments are charged and paid only by you.
Taxation Laws and Regulations in Bulgaria
Taxpayers in Bulgaria are required to register with the National Revenue Agency (NRA) and obtain a unique identification number (UIN). They are also required to keep accurate records of their income and expenses and submit tax returns to the NRA on an annual basis.
If you are interested in becoming a tax resident or have a legal procedure to follow, Legalla’s team has the necessary knowledge and experience to assist you. We will tell you what documents are needed by your side and we will prepare all of the others. After that, you can count on us to guide you through the procedure before the competent authorities step by step. Don’t hesitate to contact us, our team will reply you within 1 business day.
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