Bulgaria offers a set of benefits like low corporate income tax, double taxation avoidance agreements, white-listed jurisdiction, European status, European VAT reverse charge mechanism, loyalty to transactions with other offshore companies, perfect location and high-quality real estate.

The most common types of Bulgarian company formation are as follows:

1. Individual entrepreneur. An individual entrepreneur can be both a resident of Bulgaria, as well as a foreign citizen with a residence permit.
2. Limited liability company (Ltd. – Either sole-owned (EOOD) or with multiple shareholders (OOD). The minimum authorized capital is 2 BGN (equivalent to about 1 EUR).
3. Joint Stock Company. This more complicated business structure is not widely used. The minimum authorized capital is at least BGN 50 000. There should be at least one shareholder, either legal or private person. The minimum cost of one share is 1 BGN.

Legal entities working in Bulgaria (OOD, EOOD, AD, EAD,) pay the following taxes:

The corporate tax rate for Bulgaria is 10%. The tax base is calculated as the difference between corporate income and expenses. There is no specific requirement of costs that should be included.

The Value Added Tax (VAT) is 20%. Companies registered as VAT payers pay VAT from the assets and services provided in the country, as well as from imported goods. Export of goods and services is not subject to VAT and a so-called reverse (0%) rate can be applied. VAT registration is necessary if the annual turnover exceeds 50 000BGN. This tax is paid on a monthly basis. VAT refunds can be made for the goods exported from Bulgaria. The rates are lower, for example, for the hotel business, VAT is 9%

Payroll taxes (FOT) are 40% of wages paid, which cannot be less than the minimum, defined by law for each group of staff.

For better tax planning, we advise using business types like DTM / EOOD.

To learn more about company formation and tax planning schemes in Bulgaria, please feel free to contact our specialists.

Company incorporation and doing business in Bulgaria is carried out within the legal framework. There are two types of companies similar to LTDs – with one founder (EOOD) and two or more founders (OOD).

The company has a legal name in Cyrillic and has the right to use the Latin name, which is mentioned in the Statute. There needs to be at least one director, to represent the company; there is no requirement for the director/s to be resident in Bulgaria.
The minimum share capital is only 2 Bulgarian leva (BGN). 70% of authorized share capital must be initially paid up, the remainder to be paid up within 1 year of incorporation. We recommend setting a higher authorized capital, which you can include in the expenses and get a VAT refund.

The OOD / EOOD does not require the founders’ personal presence in the management of the Company; its liability is limited to the amount of the authorized capital. At the same time, the OOD / EOOD differs from the Joint-Stock Company by fast and easy procedures, a low minimum authorized capital, and a higher level of confidentiality. The shares of OOD owned by members of a
Limited Liability Company cannot be transferred without the approval of at least 75% of the participants. Shares of OOD / EOOD are not separable.

The number of founders is not limited. One or several Co-founders can manage and represent the Company. The number of founders can be changed after the company incorporation. All changes in the Articles of Incorporation must be registered in Court.

The company information is filed to the Bulgarian Trade Register, which is public. It displays the following information:

• the company name in Bulgarian and Latin characters (in English);
• legal form of Company – OOD, EOOD, etc.;
• the address of the Company;
• type of activity;
• the names of the Directors;
• the names of the shareholders/shareholder;
• amount of authorized capital.

When the company is formed, you get a TBR number. After this, you can open a current account in any bank. Tax office number is required if you have a non-resident Director. Notify the tax office during a week from the moment of the first invoice and choose the form of the company structure. There are monthly expenses for the Director on deductions. If the founder (or one of them) is an individual, he/she can be either a Head of the company as self-employed. If the founders are third parties (for example, a foreign legal entity), it is necessary to arrange a Contract on Management and Control (contractual employment). It is required to get a work permit.

All companies in Bulgaria are required to keep accounting records, file financial and tax reports.

There is no need to visit the country in person. The company formation can be done remotely.

1. A residence permit, through an investment in the authorized capital of more than BGN 250,000;
2. Fast and easy company formation and account opening.
3. 0% VAT rate applies to transactions of purchase and sale of goods and services within the European Zone.
4. One of the lowest tax rates in the European Union.

• How to register a company in Bulgaria?

  Before registering a company, you need to decide how to incorporate it – remotely or by travelling there. In the case of a personal visit, it is necessary to verify the Director’s signature. If you are forming the company remotely, visit the Bulgarian Consulate in the country of residence or at a local Notary and translate and legalize it in the Ministry of Foreign Affairs of Bulgaria. An apostille is not required for the documents from Russia and Ukraine. For remote registration, a notarized power of attorney is required to open a deposit and a current account.

  The company formation takes 2-4 days, and then the information is published in the Commercial Register. There are no certificates in Bulgaria. It is possible to obtain a certificate with a register stamp.

  Steps of Company registration in Bulgaria

  • Choosing a company name
  • Filling incorporation documents
  • Opening of temporary account for depositing authorized capital
  • Signature certification for the founders and Board members
  • In case of remote registration, sending signed documents to Bulgaria and their translation
  • Payment of fees
  • Registration in the Register of Companies
  • Courier services
  • If necessary, opening a bank account

  What is required to register a company?

  • The name of the company
  • Information about the founder (passport copy, proof of address); if the founder is a foreign legal entity, then the Constituent Documents and the Certificate of the status less than 3 months old. (for example, for the Russian Federation – TIN, SRN, Statute, – notarial copies, extract from the Unified State Register of Legal Entities – the original with a seal, – documents must be translated and legalized in Bulgaria)
  • Information about the Board members – an individual, if it is not the same person as the founder of the company
  • Authorized capital
  • Business activity

• Bulgarian companies are perfect for:

  • trading companies in Europe
  • obtaining a residence permit in Europe
  • agency companies
  • holding company