• Accounting

  • Bookkeeping

  • Tax Compliance

  • TAX optimization

  • VAT Refund assistance

  • E-services (MOSS)

From January 2016, all VAT-registered companies in Bulgaria have to declare the amount of VAT for the private usage of business assets with submission of monthly VAT returns and purchases and sales ledgers to the NRA. The guide for application of this system was adopted by NRA.

Where the purchase of an asset it is known that it will be used solely for personal purposes and for the purchase of those goods VAT credit was not used, then it is not expected by NRA that the companies will charge VAT for such usage.

In cases where the goods will be used for both business and private purposes, there are two options:

·        Full VAT deduction, with VAT to be charged for personal usage of the goods;

·        VAT to be deducted in proportion corresponding to the ratio of private-business usage of the goods.

VAT Compliance

 

If you are VAT registered person in Bulgaria or you will become such sooner, you need to follow certain requirements regarding invoicing, bookkeeping, accounting ledgers and statements that need to be submitted regularly to the Revenue Agency. This is what we call VAT compliance.

Failing to comply with the formalities related to the settlement of VAT or incorrect settlement of VAT may result in additional costs for the company and create a risk of liability for those responsible for tax settlements.

To mitigate such risks, we support our clients with the formalities related to the settlement of VAT. Our VAT compliance services include assistance with Registration for VAT in European Union (EU VAT Registration), record-keeping and preparation of VAT tax returns and assistance in obtaining a rapid refund of VAT payable by foreign entities.

Our team of VAT specialists can support you, can prepare everything needed for you and can provide you with practical advises.

Bulgarian VAT

Bulgarian VAT rates

Bulgaria is part of the EU and follows the EU rules on VAT compliance. All suppliers of goods or services who are VAT registered in Bulgaria must charge the appropriate VAT rate, and collect the tax for onward payment to the Bulgarian National Revenue Agency (NRA) through a monthly VAT submission process.

Important aspects of the VAT act in Bulgaria:

  • If a company not established in Bulgaria is providing ‘taxable supplies’ of goods or services in Bulgaria, it may have to obtain a non-resident VAT registration. 
  • VAT is payable on assets and services in Bulgaria as well as on imports into Bulgaria.
  • Exports from Bulgaria are exempt from VAT.
  • Income from financial services such as insurance and banking services are exempt from VAT. Legal advice is also exempt from VAT subject to the terms specified in law.
  • Every business that had a turnover in excess of BGL 50,000 in the previous 12 months must obligatory register with the tax authorities.

 

If you are not established in Bulgaria, there are number of cases which might trigger an obligation for you to register for Bulgarian VAT, e.g: 

  • Importing goods into Bulgaria from outside the European Union.
  • Buying and selling goods in Bulgaria.
  • Selling goods from Bulgaria which are delivered to customers outside of Bulgaria (business or private customers).
  • Acquiring goods in Bulgaria from another EU country (Intra-community acquisitions).
  • Holding inventory in Bulgaria for sale, distribution or consignment.
  • E-commerce sales of goods to consumers, subject to Distance Selling VAT registration thresholds.
  • Organising events in Bulgaria where attendees or delegates must pay admission.

 

As a Bulgarian VAT-registered entity, you will have to follow certain legal obligations. This includes:

  • Issuing invoices with the disclosure details outlined in the Bulgarian VAT Act.
  • Maintain sales and purchases ledgers and all the transactions, which are held in the least 10 years.
  • Correct invoicing of customers for goods or services in accordance with the Bulgarian VAT rules.
  • Processing of credit notes and other corrections.
  • Use of approved foreign currency rates.
  • Submit monthly VAT information to NRA Bulgaria

 

 The current VAT Rates in Bulgaria are:

 

VAT Rate Rate Type Applied on
20% Standard All goods and services, except hotel accommodation 
9% Reduced Hotel accommodation and certain touristic services
0% Zero rated Intra- Community supplies and international transport

 

Which is the moment, when the Bulgarian VAT shall be charged?

In general, for goods where a VAT invoice has not been issued, i.e. most B2C transactions, the tax point is generally the physical supply of the goods or the payment, whichever is earlier.  For goods supplies where an invoice is issued, i.e. most B2B transactions, the tax point is generally deemed to be the invoice date regardless of when the actual supply took place.  For the supply of services where no VAT invoice is issued i.e. B2C services the tax point is usually considered to be the time when the service is delivered to the customer or the payment, whichever takes place earlier. In the case of longer B2C services the tax point occurs when the service has been completed. For service supply where a VAT invoice is issued i.e. B2B services the tax point occurs on the invoice date regardless of when the supply occurred.

 

For more information, see our section for services: VAT Compliance

VAT Service professionals will provide you with deep fiscal knowledge, combined with practical commercial and industry experience, and a pragmatic approach to the tax function that will help you navigate today’s complex TAX compliance environment.  Our experienced people, consistent methodologies and strong commitment to quality service help you build the strong compliance and reporting foundations and sustainable tax strategies that help your business achieve its ambitions.  

How we could assist you achieve your business goals? 

Domestic Business VAT & Tax compliance in Bulgaria

Our Domestic Business Tax services are designed to meet your business tax compliance and advisory needs. Our tax professionals draw on their diverse perspectives and skills to give you a seamless service through all the challenges of planning, financial accounting, tax compliance and maintaining effective relationships with the tax authorities. Offering a broad spectrum of services, including :

  • Company Registration

  • Business Tax Registration

  • Business Tax Compliance

  • Business Tax Advisory

  • Tax Accounting and Risk Advisory

  • Personal Financial Services

 

EU Intra Community transactions and International Taxation

Our dedicated international tax professionals assist our clients with their intra-community and cross-border tax structuring, planning, reporting and risk management. We work with you to build proactive and integrated global tax strategies that address the tax risks of today’s businesses and help achieve sustainable growth while minimizing your tax compliance and accounting costs. Our service offerings include:

 

  • EU Indirect Taxation assistance  (VAT / GST / Sales tax)

  • EU VAT Registration and compliance

  • VAT on Intra Community supplies

  • International Tax

  • Cross Border Advisory

  • Transfer Pricing and Tax Efficient Supply Chain Management

  • Customs clearance and International Trade

  • Intrastat reporting

 

See more Bulgarian VAT rates

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