Bulgaria Property Tax Overview

This article gives an overview of the main taxes that a property owner would need to deal with in Bulgaria.

Personal tax number

Property owners must register themselves for tax and obtain a BULSTAT number.

 

Property tax

Properties must be registered for property and garage tax at the local municipality. This must be done within two months of purchasing the property otherwise fines are applied.

 

Income tax on rents

Income tax rate is 10%.

The tax year runs from 1^st January to 31^st December.

Income tax return deadline is 30^th April each year. A flat rate 10% of income can be set as costs, no matter what the real costs.

Income tax must be paid monthly (or quarterly in some cases) – this is a new rule from January 2011:

• If the tenant is a company the company is responsible to deduct & pay to the tax office 10% from the rent monthly
• If the tenant is a private individual the foreign owner has to pay a 10% withholding tax by the 15^th of the following month/quarter

 

Sales Tax

There are no property sales taxes, though there are notary fees to pay and the buyers has to pay a purchase tax of approx 2% which is sometimes shared with the seller.

 

Capital Gains Tax

There is 10% capital gains tax in Bulgaria (capital gains are treated as income).

 

Corporation Tax

Corporations are taxed at 10% on profits in Bulgaria and dividends taxed at 5%.

 

VAT

The Value Added Tax rate in Bulgaria is 20%.