Taxes are inseparable part of every business. As important element on which the whole financial result of the company depends, taxes have their own requirements and deadlines that should be kept by each company, in particular its accountants. We can remind you the deadlines for obligatory payments to the budget, as well as the documents that need to be submitted in front of the specialized authorities in order to keep the Bulgarian legislation.
We can give your company directions and specific advice for the taxation in Bulgaria. We can help your company plan the obligatory taxes, connected with the specific activity of your business, as well as manage the cash flow
Taxation in Bulgaria:
There are several important tax laws in Bulgaria that have influence on the activity of the companies. You can get a little bit more familiar with Bulgarian taxation if you read the next paragraphs:
1) Corporate Income Taxation Act (CITA) – according to this Act all the companies that have activity in Bulgaria are obliged to pay
- Corporate tax of 10% over the profit, after the submission of the annual tax declaration; the tax is payable till the end of March (deadline – 31 March next year).
- Dividend tax of 5% payable after the shareholders approve the annual reports and take decision to distribute dividends; the deadline for payment of that tax is one month after the date of the decision.
- Withholding tax of 10% the tax occurs for special types of income generated in Bulgaria and payable to a foreign entity (there are exceptions with some countries with which Bulgaria has Double Taxation Avoidance Treaty), the types of income are specified in CITA; deadline for payment of that tax is the end of the month following the month when the income has been recognized.
- Tax on representative expenses – 10%
- Tax on social expenses – 10%
- Tax on fuel on vehicles – 10%
The deadline for payment of the taxes on representative expenses, social expenses and fuel on vehicles is 14-th of the month following the month when the expenses have been recognized.
2) Value Added Tax Act (VATA) – according to that act the VAT rate in Bulgaria is 20%; VAT for tourism services is 9% and the VAT for deals in the EU countries is 0%.
There are free of VAT charge activities which are listed in details in the VAT act (for example financial services; social and health services, NGO activities, etc.) The deadline for payment of VAT is 14-th of the month.
3) Personal Income Tax Act (PITA) – according to that act the income earned by resident and non-resident individuals (local for Bulgarian taxation), including income from sole-trade activities are taxable with 10% income tax. Deadline for payment of personal income tax is 30 of April of the next year.