Business changes in Bulgaria in 2018

Some of the changes concerning the business in Bulgaria, which came into force in 2018:

Tax returns

From 2018 all tax returns in accordance with the template of the Corporate Income Tax Act (CITA) will be submitted electronically. Companies without any activities during the year will no longer be obliged to submit an annual tax return, but only to declare that they have not done business.

The possibility of submitting a zero-rate VAT return on paper, as well as tax returns with diaries containing up to five rows, is cancelled. There will be an obligation to electronically declare an applied tax relief to the source for paid income of up to 500 000 BGN with origin from Bulgaria, when the receivers of the income are more than five people.

Deals between related parties

In 2017, a country-by-country reporting for multinational groups was introduced for the purposes of analyzing the risk, associated with pricing between affiliate companies (transfer pricing). Local companies with over 100 million BGN annual turnover and participation in foreign companies with a consolidation obligation in Bulgaria are obliged to report to the National Revenue Agency (NRA). Local multinational companies must notify the NRA in which country the group report will be submitted. The deadline for submission of the first reports and notifications expired on 2 January 2018.

Taxation of revenue

According to a change in the Corporate Income Tax Act (CITA) a new accounting standard for revenue accounting enters into force (Revenue from client contracts). In all likelihood, it will not have a serious effect on „simple“ contracts, but for long-term service contracts, as well as transactions consisting of different components (for example, service-related goods), the new rules may change the moment of revenue recognition. This will have an effect on defining the taxable revenue for the year.


From 2018, when an obligation for VAT registration is not fulfilled, a tax will be owed on the delivery, with which the threshold of 50 thousand BGN has been reached. However, the change leaves room for non-taxation of turnover, but certainly requires more careful tracking of revenue from now on.

Income payment to individuals

The deadlines for the declaration of incomes of individuals, both by themselves and by companies, which pay income to them, are shortened. Income payers, who are subject to a final tax, are now required to submit quarterly returns only electronically.

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