In short
- Corporate tax is a flat 10% of taxable profit. Return and payment: 1 March to 30 June.
- Dividends to individuals: 5%, withheld by the company. Profit to pocket costs 14.5% in Bulgaria.
- No advance payments in the first two calendar years or with sales of up to €153,387.56.
- A 15% minimum tax applies from 2024 to groups with revenue of €750 million or more.
In this guide
Bulgaria's 10% corporate tax rate and the taxes beside it
Bulgarian taxes on profit and income are flat: one rate applies whatever the amount. Bulgaria has no local or regional tax on profit, and the corporate rate has stood at 10% since 2007.
| Tax | Rate | On what |
|---|---|---|
| Corporate tax | 10% | Taxable profit of the year |
| Dividend tax | 5% | Dividends to individuals and to companies outside the EU and the EEA |
| Personal income tax | 10% | Salaries and directors' pay |
| Social security on a salary | 18.92% and 13.78% | The employer's and the employee's parts at the lowest accident rate, on up to €2,300 a month |
| Tax on expenses | 10% and 3% | Entertainment and benefits in kind; private use of company assets |
| Withholding tax | 10% | Interest, royalties and listed fees paid to foreign companies |
| VAT | 20%, 9% and 0% | 9% on hotel stays, books, baby food and nappies; 0% on exports and on goods sent to VAT-registered buyers in other EU states |
A VAT number in Bulgaria is compulsory once turnover passes €51,130 in a calendar year. We prepare and file the returns for every tax in the table.
Every other tax of a company and its owner, with its base and due date: tax rates in Bulgaria.
How the 10% corporate tax is calculated
The base is the accounting profit of the calendar year, corrected by the rules of the Corporate Income Tax Act. A company registered in Bulgaria is taxed on its profit from every source, in Bulgaria and abroad. A small company meets six of these corrections.
- Costs with no link to the business, costs with no document, and fines and late interest owed to the state are not deductible.
- Depreciation is deducted at the tax rates capped in the table below, whatever rates the books use.
- Interest: once debt exceeds three times equity, the deduction is capped at interest income plus 75% of the profit before interest, and the rest moves to later years. Bank loans with no guarantee from a related party are outside the cap.
- Bonuses and fees owed to individuals resident in Bulgaria and unpaid on 31 December count in the year they are paid. Basic salaries are outside this rule.
- A tax loss is carried forward against the profit of the next five years.
- A gain on the sale of an asset or of shares is taxed as part of the profit. Gains on shares sold on a regulated market or a growth market are exempt, and losses on them do not count.
| Asset | Highest yearly tax depreciation |
|---|---|
| Buildings, facilities and transmission lines | 4% |
| Machinery and production equipment | 30%, or 50% when new and part of a first investment |
| Vehicles other than cars | 10% |
| Computers, software and mobile phones | 50% |
| Cars | 25%, or 50% for electric cars from 2026 |
| Other assets | 15% |
An item below BGN 700, which is €357.90, and below the threshold in the company's accounting policy is an expense of the year of purchase. The Act still states its limits in leva. They convert at the fixed rate of 1.95583, as the guide to Bulgaria's euro adoption shows.
Advance payments of corporate tax
Advances depend on the net sales of the year before last: the sales of 2024 decide the advances of 2026. A new company pays none in the calendar year of its registration and in the next one.
| Net sales two years earlier | Advances | Due |
|---|---|---|
| Up to €153,387.56 | None | The whole tax by 30 June of the next year |
| Above €153,387.56 and up to €1,533,875.64 | Quarterly, three a year | 15 April, 15 July and 1 December |
| Above €1,533,875.64 | Monthly, twelve a year | 15 April for January to March, the 15th of each month from April to November, 1 December for December |
The test looks at sales and ignores profit, so a trader with a thin margin can owe advances while a consultancy with a high margin owes none.
The base is the company's own forecast of this year's taxable profit, declared between 1 March and 15 April. A monthly advance is one twelfth of 10% of the forecast, and a quarterly advance is one quarter of it. A declaration filed by 15 November raises or lowers the advances still to come.
Interest is charged when the final tax exceeds the monthly advances by more than 25%, or when 75% of it exceeds the quarterly advances by more than 25%. It runs on the excess from 16 April to 31 December.
A quarterly payer that forecast a profit of €40,000 pays three advances of €1,000. If the year ends with €70,000, the tax is €7,000 and 75% of it is €5,250. The advances with the tolerance cover €3,750, so interest runs on €1,500. A forecast of zero leaves the largest amount open to interest.
The corporate tax return and its dates
The tax year is the calendar year, and the first year of a new company runs from its registration to 31 December. The return for 2026 is filed online between 1 March and 30 June 2027, together with the annual activity report for the statistics institute. The tax left after the advances is paid by 30 June 2027.
A company with no activity in the year files no return. A missed or late return costs BGN 500 to 3,000, which is €255.65 to €1,533.88, and twice that for a repeat.
The other filings of the year, from VAT to the financial statements, are in the guide to accounting requirements in Bulgaria.
Bulgaria's 5% dividend tax
A dividend is paid from profit that has already borne corporate tax, after the owners adopt the yearly statements and decide the distribution in writing. The tax is final and is counted on the gross amount in the decision. The company withholds it and pays it by the end of the month after the quarter of the decision: a decision in May is settled by 31 July.
| Who receives the dividend | Tax withheld |
|---|---|
| An individual, resident in Bulgaria or abroad | 5%, or a lower treaty rate |
| A Bulgarian company | None: the dividend is not taxable income |
| A company resident in an EU or EEA state | None |
| A company from any other country | 5%, or a lower treaty rate |
A treaty rate applies when the owner gives the company a certificate of tax residence and a declaration of beneficial ownership before the payment. A dividend of BGN 1,000 or more, which is €511.29, is paid through a bank account, and a cash payment of that size costs the company a sanction of half the amount.
We do this for you Accounting in Bulgaria from €150 a month
The tax on expenses in kind
Three kinds of company spending carry a final tax of their own. It is declared in the yearly return and paid by 30 June. Its base is the expense itself, so it is due in a loss year too.
| Expense | Rate | Base |
|---|---|---|
| Entertainment of clients and partners | 10% | The full cost |
| Benefits in kind for staff and directors | 10% | The cost of the benefit |
| Private use of company assets by people who work in the company | 3% | For a vehicle 50% of its yearly costs, or the share shown by a log of trips; for other equipment 20% |
A company car with yearly costs of €6,500 and no log has a base of €3,250, and the tax is €97.50. The 3% rule covers people who work in the company, the insured owner among them.
An amount paid to an owner or a related person that has no link to the business or exceeds market levels is a hidden distribution of profit. The cost is not deductible, it bears 5% as a dividend and, when it is left out of the return, a sanction of 20% of the amount.
Bulgarian withholding tax on payments abroad
A Bulgarian company that pays listed kinds of income to a foreign company withholds 10% and pays it to the National Revenue Agency. The duty lies on the payer: the tax is declared and paid by the end of the month after the quarter in which the income is booked. An operating company meets these items of the list.
- Interest, the interest inside lease instalments included
- Royalties and licence fees
- Fees for technical services, which the Act defines as installation of assets, consulting and marketing research
- Rent of movable property, and rent of real estate in Bulgaria
- Franchise and factoring fees
- Pay for managing or supervising a Bulgarian company
A purchase of goods is outside the list, and so is a licence for a copy of standard software. Interest and royalties paid to an associated company in another EU state can be exempt. The main condition is that one company has held at least 25% of the other for two years without a break. When the company bears the tax in place of the recipient, that cost is not deductible.
A tax treaty can lower the rate. For income of up to BGN 500,000 a year, which is €255,645.94, the payer applies the treaty on the recipient's documents and reports it by 31 March of the next year. Above that amount the relief is requested from the revenue authority in advance.
Bulgaria's 15% minimum tax for large groups
Bulgaria has applied the global minimum tax since 1 January 2024. It reaches companies in Bulgaria that belong to a multinational group or a large domestic group whose consolidated revenue was at least €750 million in two of the four preceding tax periods. For such a group a top-up tax and a domestic top-up tax lift the effective rate in the country to 15%.
A company outside such a group pays 10%.
From profit to the owner's pocket: a worked example
An EOOD earns a taxable profit of €80,000 in 2026 on sales of €240,000. Its sales of 2024 were €120,000, so it paid no advances during 2026. The table compares an owner who is an individual living abroad with a parent company in another EU state.
| Step | Individual owner | Parent company in the EU |
|---|---|---|
| Taxable profit | €80,000 | €80,000 |
| Corporate tax at 10% | €8,000 | €8,000 |
| Profit to distribute | €72,000 | €72,000 |
| Dividend tax withheld | €3,600, 5% of €72,000 | None |
| Received by the owner | €68,400 | €72,000 |
| Bulgarian tax in all | €11,600, 14.5% of the profit | €8,000, 10% of the profit |
The €8,000 is paid by 30 June 2027. A dividend decided in March 2027 puts the €3,600 at the tax office by 30 April 2027. The sales of 2026 pass €153,387.56, so quarterly advances are due in 2028: the sales of 2026 decide them.
The owner's country of residence then applies its own rules to the dividend, and a tax treaty with Bulgaria settles how the 5% is credited there. An owner who works in the company in Bulgaria adds social security from €172.42 a month: the guide to the EOOD and the OOD compares the two ways of insuring an owner.
A company pays no advances in the calendar year of its company formation in Bulgaria and in the next one. Our accountants file the forecast, the returns and the dividend tax for you: accounting and tax returns for a Bulgarian company.
