Setting up a Business in Bulgaria
Contributed by TBA & Associates
25 November, 2019
Only 3 days to incorporate
Only EUR 1 minimum start-up capital
Directors can be of any nationality
Shareholders can be private individuals or legal entity
TBA's experienced team of lawyers and accountants in Bulgaria provides a comprehensive range of customised services to include the formation of Bulgarian Corporate entities, advice relating to the structuring of foreign direct investment into Bulgarian and the Balkans region and specialist advice regarding Property transactions and ownership structures.
All persons wishing to undertake economic activity through a local company in Bulgaria have to apply to the Bulgarian District Court for registration at the special Commercial Register kept by the Court.
Authorization to conduct economic activity is given from the date of entry in the Commercial Register.
Foreign entities may operate through joint-ventures, wholly owned subsidiaries and branches in Bulgaria.
Corporate Entities in Bulgaria
The Bulgarian Commercial law allows for the following types of corporate entities:
The most appropriate types of companies for carrying out business in Bulgaria are a private limited company, a public limited company, a single-person private limited company, a holding, a branch, and a representative office.
All of these (with the exception of a representative office) have to be entered into the commercial register kept with the relevant district court.
Amongst all these types of entities, the most frequent one is the "Private Limited Company - EOOD".
Single Person Private Limited Liability Company in Bulgaria - (EOOD)
Single Person Private Limited Company (a limited liability company) - "OOD" - it is a commercial company with share capital owned by its single member whose liability is limited to the amount of the capital subscribed. It may be established by one or more persons, including foreign natural or legal persons. The minimum foundation capital is 1 Euro and 100% of the capital must be paid up on foundation. Contributions to the foundation capital may be paid in cash or in kind. The statutory bodies of the private limited companies are the general meeting of shareholders, which must be held at least once a year, and the managing director.
Corporate income tax rate is 10% on the profit
Taxable entities - Companies and partnerships established under Bulgarian law
Permanent establishments of non-resident entities in Bulgaria
Taxable Profit - Financial result adjusted for tax purposes
Accounting Rules - IFRS or local Bulgarian GAAP (for small and medium-sized enterprises).
Tax Loss can be Carried Forward - Tax losses can be carried forward over the next five consecutive years.
Tax Returns and Payment - The annual corporate tax return has to be submitted by 31st March of the following year.
The tax year is the calendar year - The corporate tax has to be paid also by 31st March. Quarterly or monthly advance instalments are due during the year.
Value Added Tax (VAT)
The Bulgarian VAT legislation is based on the EU VAT rules and Directive 2006/112/EC.
Bulgarian VAT Rates: 20% for domestic supplies, intra-community acquisitions and importation from non-EU countries, 9% for hotel accommodation services.
TBA will help and assist you getting locally registered for VAT and open your business Bank Account.
Should you have any question or matter you would like to discuss or clarify with us, or should you like to receive full information Report on this jurisdiction, contact us now!
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