понеделник, 15 януари 2018 г.

Taxation - Bulgaria Income Taxes and Tax Laws 2018

In Bulgaria the income of any individual is a subject to a flat income tax rate of 10% in 2018.
Exemptions are granted to taxpayers with specific types of income.
The standard rate of Bulgarian corporate tax in 2018 is 10%.

Income Tax for an Individual

Individual in Bulgaria is liable for a tax on his income as an employee, as well as on the income as a self-employed person.
In the case of an individual who answers the test of a "permanent resident of Bulgaria", tax will be calculated both on his income earned within the Republic of Bulgaria and overseas.
To be considered a Bulgarian resident for tax purposes, requirements must be met of residency in Bulgaria of at least 183 days in any calendar year, also if he resides less than 183 days per year but has got home in Bulgaria being proven as his main home shall be considered a Bulgarian resident for tax purposes.
A NON-RESIDENT who is employed in Bulgaria pays tax only on his income in Bulgaria.
With very few exceptions every person over age of 18 who work in Bulgaria must contribute to the Bulgarian Pension and Health Fund. 
An employer is obligated to deduct social security contributions as well as 10% income tax payable immediately each month from the salary paid to an employee.
With regards to salaries, the social security rates are:
Employer pays 18.92%-19.62% over the gross salary.
Employee pays 13.78% over the gross salary.

Corporation Tax

In 2018 the standard corporate tax rate in Bulgaria is 10%.
A special tax rate is applicable for companies dealing with shipping as well as companies engaged in games of chance and gambling.
Companies having net revenue of BGN 300,000 and more in the previous year, shall make 3 quarterly advance payments throughout next year.

Deduction of Tax at Source in Bulgaria - Withholding Tax

Tax must be deducted at source from the following payments to NON-RESIDENTS on the basis of the following:
Dividend - The standard deduction is 5%.
Interest - The standard rate of tax deducted at source is 10%.
Royalties - The standard tax rate deducted at source is 10%.

Bulgaria Value Added Tax

Bulgaria VAT is 20%. There is a reduced rate of 9% for the hotel services.
The VAT is applicable to the taxable supplies of goods and services on the territory of the country, to the taxable intra-European Union acquisitions, as well as to the importation of goods into Bulgaria.
Exports from Bulgaria are exempt from VAT.
Incomes from financial services such as insurance and banking services are exempt from VAT.
Any business having a taxable turnover of BGN 50,000 or more for a period of 12 consecutive months shall submit an application for registration under the VAT act.

Bulgaria Real Estate Tax - Local Taxes and Fees

The rate of local taxes on real estate is 0.01%-0.45%.
It is determined according to the location of the municipality.

Bulgaria Transfer Tax

Tax is levied on the transfer amount of real estates and vehicles. 
Tax rates are 0.1%-3%.

Bulgaria Inheritance Tax

Inheritance Tax is levied on the estate of an individual when being inherited by legal or testamentary succession.
The tax rate is 0.4%-0.8% for close relatives, up to 6.6% for non close relatives.
There are exemptions for properties valued under BGN 250,000.

Other useful information

National currency of Bulgaria is the Bulgarian Lev (BGN). It has been tied to the Euro by a currency board since 1997 (1 BGN = 1.95583 Euro)

Bulgarian Coins ( Stotinki )
Bulgarian Banknotes ( Lev )

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