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The Bulgarian Taxation System
VAT
The amount of VAT in Bulgaria is 20% with some exceptions. Some land purchase deals are free of VAT,
shares purchases, etc. Some are charged VAT at a lower rate.
Individual Taxation
The taxation of the annual income of an individual in Bulgaria is in accordance with the following
progressive table:
Annual income Taxation
Up to 1560 leva. Free of taxes
from 1560 leva. to 1800 leva. 10 % for the income over 1560 leva.
from 1800 leva to 3000 leva. 24 leva + 20 % for the income over 1800 leva.
from 3000 leva. to 7200 leva. 264 leva + 22% for the income over 3000 leva.
over 7200 leva. 1188 leva + 24 % for the income over 7200 leva.
The dividends accounted from Bulgarian companies in benefit of the shareholders in the
respective company will be taxed with “final tax” which is always an amount of 7%.
These incomes, after the taxation of 7%, will not be included in the total income
described in the table above.
Company Taxation
Companies pay “corporation tax” at 15% of the net income for the respective year on an
annual basis.
TAXATION IN ACCORDANCE WITH REAL ESTATE OWNERSHIP
Taxation of real estate assets is 0.15% of the tax valuation per annum. The valuation is
in accordance with addendum No 2 of the Law for the local taxes and fees.
Also the owners of real estate properties have to pay a fee for the removal of rubbish, the fee
is different for of every municipality. The fee is defined every year by the
municipality’s council.
TRANSFER ABROAD OF INCOME REALIZED IN BULGARIA
Foreign investors can repatriate their incomes realized in Bulgaria without any restrictions
after they prove that all due taxes regarding the mentioned incomes in Bulgaria are paid.
Cost of Living
The cost of living is very low compared to UK standards and the national minimum wage is 50 leva per month
(about £15). This means that what may seem cheap to British people may be expensive to Bulgarian Nationals.
Generally goods and services are a third cheaper than UK and you can enjoy a hearty meal with wine for
15 leva (£5) per couple. There are a few "trendy" bars opening up around the country which can make you feel
as though you are in "Manchester" or other cosmopolitan areas, these may look expensive but again are extremely
cheap to drink and eat in.
Cigarettes (pack of 20) 150 leva => 50pence
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Property Exhibitions