Quick Answer
Bulgaria has one of the most competitive tax systems in the European Union. Corporate income tax and personal income tax are both levied at a flat rate of 10%. Value Added Tax (VAT) applies at 20%, with a reduced 9% rate for specific goods and services. Tax residency, VAT registration, and filing deadlines are key factors determining actual tax obligations for businesses and individuals.
Taxation in Bulgaria – Key Rates & Deadlines (Summary)
| Tax Type | Rate | Applies To | Filing / Payment Deadline |
|---|---|---|---|
| Corporate Income Tax (CIT) | 10% flat | Resident companies; Bulgarian-source income of non-residents | Annual return by 30 June |
| Personal Income Tax (PIT) | 10% flat | Employees, freelancers, self-employed individuals | Annual return by 30 April |
| Value Added Tax (VAT) | 20% standard 9% reduced | VAT-registered businesses | Monthly VAT returns |
| VAT Registration Threshold | EUR 51,130 per calendar year | Businesses exceeding threshold or performing specific EU transactions | Registration upon reaching threshold |
| Dividend Withholding Tax | 5% | Dividends paid to shareholders | Within 1 month of distribution |
| Social Security Contributions | Variable (capped annually) | Employers, employees, self-employed | Monthly via payroll |
Note: Tax residency, VAT obligations, and social security treatment depend on factual circumstances and may be affected by EU law and double tax treaties.
Introduction
Bulgaria has become an increasingly attractive destination for businesses and individuals alike, partly due to its low tax rates and relatively straightforward tax framework. As an EU member state, Bulgaria applies harmonised EU rules in areas such as VAT, while maintaining national autonomy over income and corporate taxation.
This guide provides a practical overview of the main taxes applicable to companies, self-employed individuals, employees, and non-residents operating in or through Bulgaria.
Corporate Income Tax
Corporate income tax in Bulgaria is levied at a flat rate of 10%, one of the lowest within the European Union. The tax applies to both resident and non-resident companies and is governed by the Corporate Income Tax Act (CITA).
For a full explanation of how taxable profit is calculated, tax adjustments applied, and how the 10% rate operates in practice, see our guide on
👉 Corporate Tax act in Bulgaria (CITA): 10% Rate & Rules
Taxable Base
- Resident companies are taxed on their worldwide income.
- Non-resident companies are taxed only on income sourced in Bulgaria.
Annual Tax Return
All companies must file an annual corporate income tax return by 30 June of the following year.
For a detailed explanation of filing requirements, deadlines, and common mistakes, see:
👉 Annual Tax Returns in Bulgaria Explained – A Guide for Companies
Dividends
- Dividends distributed to shareholders are generally subject to a 5% withholding tax.
- The tax is due within one month of the dividend distribution.
- Double tax treaties and EU directives may provide exemptions or reduced rates in specific cases.
Personal Income Tax
Personal income tax in Bulgaria is also levied at a flat rate of 10% and applies to various types of income, including:
- employment income
- self-employment income
- rental income
- capital gains (subject to exemptions)
- interest and dividends
Employees typically have tax withheld at source, while self-employed individuals must file an annual personal tax return by 30 April of the following year.
For a detailed walkthrough, see:
👉 Personal Annual Tax Return in Bulgaria
Value Added Tax (VAT)
Bulgaria applies a Value Added Tax (VAT) system in line with EU VAT legislation.
VAT Rates
- Standard rate: 20%
- Reduced rate: 9% (applies to specific goods and services such as accommodation, books, and certain food products)
- Zero rate: applies mainly to intra-EU supplies of goods and exports outside the EU
VAT Registration Threshold
- The VAT registration threshold is EUR 51,130 per calendar year.
- Turnover is monitored per calendar year, not on a rolling 12-month basis.
Certain businesses must register regardless of turnover, including those engaged in:
- intra-community supplies of goods,
- specific cross-border services under EU VAT rules.
Voluntary VAT registration is also available below the threshold.
For recent legislative updates, see:
👉 VAT Changes in Bulgaria 2026
👉 VAT in Bulgaria: A Comprehensive Guide for Businesses
Other Taxes in Bulgaria
In addition to income taxes and VAT, businesses and individuals may encounter the following:
Property and Municipal Taxes
- Property tax on residential and commercial real estate
- Vehicle tax and other local levies
Rates vary by municipality.
Read more here:
👉 Understanding Municipality Taxes in Bulgaria
Social Security Contributions
Mandatory social security contributions apply to:
- employees and employers, and
- self-employed individuals.
These contributions fund pensions, health insurance, unemployment, and other social benefits.
For a practical overview, see:
👉 Payroll in Bulgaria: An Essential Guide for Business Owners
Other Taxes and Fees
These may include:
- inheritance and gift tax
- excise duties (alcohol, tobacco, fuel)
- various administrative and local fees
Taxation of Non-Residents in Bulgaria
Non-residents are generally taxed only on Bulgarian-source income. Whether a person or company is treated as a Bulgarian tax resident depends on factors such as physical presence, centre of vital interests, and economic ties, rather than merely holding a residence permit or visa.
For a detailed explanation of how tax residence is determined in practice — including common misconceptions affecting expats, digital nomads, and investors — see:
👉 Tax Residence in Bulgaria: A Guide for Expats and Investors
Staying Updated on Taxation in Bulgaria
Bulgarian tax legislation is subject to periodic amendments. Businesses and individuals should regularly consult official sources and monitor legislative changes.
Primary official source:
👉 National Revenue Agency (NRA)
Conclusion
Bulgaria’s tax system combines low headline rates with relatively clear compliance rules, making it attractive for both businesses and individuals. However, tax residency, VAT obligations, social security contributions, and filing deadlines play a decisive role in determining actual tax exposure.
Understanding how these rules apply to your specific situation — especially when cross-border income, EU activities, or relocation are involved — is essential for long-term compliance and informed planning.
If you need assistance assessing your tax position or understanding how Bulgarian tax rules apply to your business or personal circumstances, you can contact us here for further guidance.
Frequently Asked Questions (FAQ)
What are the main types of taxes in Bulgaria?
Corporate income tax, personal income tax, VAT, property and municipal taxes, social security contributions, and other local taxes and fees.
What is the corporate income tax rate in Bulgaria?
A flat rate of 10%.
What are the deadlines for tax returns?
Corporate tax returns are due by 30 June. Personal tax returns are due by 30 April of the following year.
When is VAT registration required?
When annual turnover exceeds EUR 51,130, or when specific cross-border activities apply, regardless of turnover.
Does Bulgaria have double tax treaties?
Yes. Bulgaria has treaties with many countries to prevent double taxation.
Disclaimer
This article is provided for general informational purposes only and does not constitute tax, legal, or accounting advice. Tax rules may change, and individual circumstances differ. For authoritative guidance, consult official sources or qualified professionals.
Last reviewed and updated: February 2026
© 2011–2026 Aidos Accountancy Services. All rights reserved.