Accounting & Tax Compliance in Bulgaria

How accounting and tax compliance work in Bulgaria

Bulgaria applies a flat 10% corporate income tax rate, unchanged since 2007 and the lowest headline rate in the European Union, alongside a 20% standard VAT rate and employer social security contributions of 18.92% to 19.62% of gross salary depending on activity-based work-injury risk. Dividends distributed from 2026 profit are subject to 5% withholding tax, though this rate held only because a proposed increase to 10% lapsed when early parliamentary elections forced the 2025 budget to be extended into 2026. An EOOD or OOD can be formed with nominal share capital of €1 (redenominated from BGN 2); an AD requires €25,000, of which at least 25% must be paid up at formation.

Bulgaria combines the EU's lowest flat corporate tax rate with a live, dated compliance tail from the 1 January 2026 euro changeover — every contract, payroll run and statutory book had to redenominate at a fixed rate, and dual lev/euro pricing remains mandatory until 8 August 2026.

Rate structure and what it applies to

10% flat (lowest in the EU)

• Dual pricing mandate through 8 August 2026 — — every price for goods and services must display in both BGN and EUR, in matching font, size and colour, until the one-year transition period lapses
• Fixed, irrevocable conversion rate — — €1 = BGN 1.95583 applies to all contracts, payroll and statutory accounts; salary conversions must round in the employee's favour
• Dividend tax rate in flux — — the 5% withholding rate held for 2026 only because a proposed rise to 10% lapsed with early elections; groups should not assume the rate is settled long-term
• Size-tiered audit thresholds — — small enterprises face a statutory audit only if they exceed 2 of 3 thresholds (assets, revenue, headcount) for two consecutive years, while medium and large enterprises are always audited regardless

Rates that apply in Bulgaria

Bulgarian National Accounting Standards (NAS) or full IFRS as adopted by the EU (SME choice; IFRS mandatory for Public Interest Entities), and when an audit is required

Statutory bookkeeping in Bulgaria follows Bulgarian National Accounting Standards (NAS) or full IFRS as adopted by the EU (SME choice; IFRS mandatory for Public Interest Entities). Medium and large enterprises are always audited; small enterprises are audited only if they exceed 2 of 3 thresholds — BGN 2,000,000 (~€1.02M) total assets, BGN 4,000,000 (~€2.05M) net revenue, 50 employees — for two consecutive years; micro enterprises are exempt.

Annual accounts and registration

Annual corporate tax return filed between 1 March and 30 June of the following year; annual financial statements published in the Commercial Register by 30 June.

Entity registration runs through the Commercial Register and Register of Non-Profit Legal Entities, administered by the Registry Agency (Агенция по вписванията), typically taking 3–7 business days for Commercial Register approval; 2–4 weeks to full operational readiness including bank account and tax registration.

Frequently asked questions