ARTICLES

Taxation in Bulgaria

BULGARIAN PROPERTIES

In this article we will present to you the taxes in Bulgaria which we believe you will find quite useful, whether you have decided to by a property to live in or for investment purposes.

Corporate Income Tax Rate - 10%

- Exemptions:
Special purpose investment companies - 0%
Collective investment schemes, admitted to public offering in Bulgaria, and licensed investment companies of the closed-end type - 0%

Capital Gains Tax Rate - 10%

- Exemptions:
Capital gains derived from sale of shares through the Bulgarian Stock market or a regulated market in an EU/EEA member state - 0%

Debt:equity ratio - 3:1

Tax loss carry-forward - 5 years



Withholding Tax

Dividends - 5%

- Exemption:
Dividends paid to legal entities which are tax residents in an EU/EEA member state - 0%

Interest and Royalties - 10%

- Exemption:
As of 1 Jan 2011 interest and royalties paid to associated companies* that are tax residents in an EU member state - 5%

Interest and Royalties paid to associated parties before 31 Dec 2010 - 10%

Interest and Royalties paid to associated parties after 31 Dec 2014 - 0%

Special features

Transfer Pricing Documentation requirements:
In 2010, the NRA issued TP Guidelines (based on the OECD TP Guidelines)

VAT

General rate - 20%

Reduced rate - 9% (for hotel accommodation)

Refund period - 2 months under certain conditions

Individual taxation

Personal Income Tax- 10% (flat rate taxation)

Mandatory Social Security Contributions

Employer: - 17.4%
Employee: - 12.9%
Maximum monthly taxable base - BGN 2,000.

Other taxes

Real estate annual tax - 0.01%- 0.45%

Transfer tax - 0.1%- 3.0%


The rate is set by each municipality according to the location of the real estate. The taxable base can be the market price, specifically determined tax value or the gross book value.
No tax for agricultural land and forests.

Other
Taxes on certain expenses (e.g. Social Security benefits), Vehicle tax, Donation tax, Inheritance tax.

*Associated parties the case when a company has a minimum of 25% in the capital of another company or when a third company has a minimum of 25% both in the capital of the other two companies. This association has to be maintained for uninterrupted period of at least 2 years

For additional customized advice and comments, please send us your enquiry.

Read about tax conditions for property investors in Bulgaria

---
Copyright: 2011 Bulgarian Properties Ltd. All rights reserved. For further information or advice please contact us on tel.: +359 2 9 11 50 or e-mail: info@bulgarianproperties.com. The use of this article by third parties is allowed only with proper quotations of the source www.BulgarianProperties.com and the Author of the article. The data in this material has been collected by the Author and Bulgarian Properties Ltd. and is presented for information purposes only. We have made every effort to ensure the accuracy of the data. However, Bulgarian Properties Ltd. cannot be held responsible for loss or damage as a result of decisions made based on the information presented in this article.
Bulgarian Properties Ltd. 2011.


  read more articles

Comments from clients
Petya and Mihail, thank you so very much for everything you did for us during our first trip to your ...
Hello! I am happy to work with estate agent Tsvetan Petrakiev! Regards, Andriej ...
Many thanks to the staff at your Stara Zagora office whom were very helpful in every detail with ...
Read our market analyses and forecasts!
Read topical information about Bulgarian real estate, economy and tourism!
Browse our best bargain offers in Sofia city
Latest News
14 Years the Best Properties from BULGARIAN PROPERTIES!

08/March/2017

Today, on the International Womens Day, when we congratulate all women and wish them a lot of success, happiness and joy, our company also has a reason to celebrate!

We are celebrating 14 years since the start of our operations back in 2003. Through all this time, weve been actively offering you properties for sale and for rent, both in Bulgaria and abroad!

Over the... read more

LATEST REGIONAL NEWS
Bulgaria's Sozopol Voted 6th in European Best Destinations Ranking

23/February/2017
http://www.novinite.com

The Black Sea town of Sozopol has received the sixth-best result in the shortlist of the European Best Destinations 2017 ranking.

Sozopol, described in the ranking as "the oldest town in Bulgaria" (a title that can be attributed to Plovdiv, which came third last year) is also seen as a placce offering "a great diversity of landscapes and tourist opportunities", located "between cit... read more

DID YOU KNOW?
China's Alibaba 'Plans on Opening Logistics Centers in Bulgaria'

17/January/2017
novinite.com

Chinese e-commerce giant Alibaba Group Holding Limited reportedly intends on setting up a logistics center in Bulgaria that will help it to deliver goods to Europe in a timely manner.

Another one of its plans is to "offer Bulgarian food and commodities through its online platform," Yah... read more