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Broker		Juridical

Bulgaria has one of the most liberal foreign investment laws in the region regarding Bulgaria real estate, as well as the foreign investors. According to the Bulgarian Constitution and legislation foreign persons and companies can invest in real estate in Bulgaria either personally or through a local legal entity. Generally speaking, foreigners as persons can acquire only buildings but not land. Only Bulgarian citizens and legal persons (including such with foreign owner) can obtain the ownership of Bulgarian land.

Therefore, the most popular and preferred by non-residents ways to become the real estate owners are:
As far as houses, villas, flats and limited ownership rights (the right of use, the right to build a house, etc.) are concerned, you can directly purchase them as a person.
When talking about Bulgaria real estate with land, you set up a company that will be the owner of the property. Setting up a company in Bulgaria is very easy. All you need is a good solicitor or barrister at law.

FIND A PROPERTY

WITH LAND WITHOUT LAND

REGISTER
A COMPANY

NEGOTIATE

PRELIMINARY RESERVATION
CONTRACT
DEPOSIT (take the property out of the market)
CHECKS ON:

BULGARIAN RESIDENCE

Getting Bulgarian residency will give you all rights of a Bulgarian citizen except the right of voting. You will be able to buy land and other properties without any limitations and you will be able to enter and leave the country as many times you like without visas.
ices and 1500 ? EUROS for all others. These prices include all state, government and legal fees.
To obtain a permanent residence one must spend 5 years in Bulgaria under the long-term stay conditions and we can fully assist you in this process.
A long term stay permit is valid for 1 year and is issued each year. During each year of stay you are issued a Bulgarian Identity Card (the same ID document that each Bulgarian citizen holds.) After 5 years under long-term permit one can apply for permanent residence.
To get the first year long-term permit one needs to present the following:
- A valid D-type Visa, - A proof of national insurance or social security in the country of residence (such document can be issued from your local national insurance office).
- Minimum 3000 Bulgarian Levs (approx. 1550 ? EUROS or 1020 ? GBP) deposit in a personal bank account in Bulgaria.
Please note that in order your application to be successful you must have Type D Visa, for which you can apply in any Bulgarian embassy. More information about D Type visa for British citizens can be obtained at www.bulgarianembassy.org.uk.
Please also note that all applicants for long-term permit are subject to thoroughly checks by Interpol and Europol and other organisations having data for persons with criminal activities. All applicants must have clean crime records and must not be subject of criminal proceedings, otherwise applications will be rejected.
Since each application is strictly individual the process time can vary from 10 days to 3 months.

MAIN TAXES

1. Indirect Taxation: VAT
Any person (legal or physical, resident or non-resident) who has a taxable turnover of at least BGN 50,000 during the preceding twelve months is obliged to register for VAT purposes by filing a standard registration form within 14 days after the end of the calendar month in which the above threshold is reached. Under the VAT Act, such non-registered persons are subject to mandatory VAT registration. Voluntary registration is possible for persons with taxable turnover over BGN 50,000 for a period no longer than the last 12 months before the current one. Group or divisional registration is not allowed.
20% applicable to taxable supplies, including import of goods and services. A zero rate is applicable to exports.

The Bulgarian tax system is centralized. The local authority defines the local taxes and fees.

2. Imposed annual (patent) tax
It is imposed in companies which have a turnover for the last 12 months less then 75000 lv. and have any of the following legal business as:
- hotels
- restaurant
- shops
- warehouses
- foot production
- building
- computer games
- Internet services
- transport services, etc.
Before starting its business a company submits a declaration of intent with a estimate of the tax at the tax department . Payment starts from the second month after the company has started its activity, i. e. for the remaining months of the year minus one month. If the business is run during the whole calendar year, the declaration should be submitted from January. There is no need to get any patient.
The tax can be paid in one sum before 31 January at a discount of 5% or in 3 payments before 31 January, 31 July and 31 October. The tax is paid accordingly to a rigid scale fixed by law. The rate of tax depends on the kind of the populated area, type and size of the business activity (the category of the hotel and the size of the shop and the number of the seats in the restaurant). The size of the profit of the firm does not't influence the rate of the tax.
The companies which pay patent tax, pay additional tax on real estate, waste, means of transport, income tax on the wages of the staff and social deductions. VAT does not apply to these companies.

3. Tax on profit
It is imposed on the profit of the firms to which united tax does not apply. It is paid into the Republican or local budget. The rate of the tax into the Republican budget depends on the size of the annual profit.
- profit up to 50 000 BGL - rate 15 % ( before 31 December 2000 it was 20%)
- profit over 50 000 BGL - rate 20% ( before 31 December 2000 it was 25%)
* Rate of 10% into the local budget regardless of the size of the annual profit into the local budget.

The tax is paid in advance every month before the 15-th day of each month at the same rate of the previous year. At the end of the year correction is made according to the actual profit.
- if the profit is larger than that of the previous year - the difference is paid.
- if the profit is lower, the superfluous sum must be counted for future payment by adding the percentage at the National bank. If during the previous year the firm sustained losses, the monthly deductions are calculated on the base of the actual profit of the previous month. This is approximated to a certain extent and that is why according the results of the year corrections are made again. 1/2 of the profit is corrected according to the inflation.

4.Real estate tax
It is imposed on the whole real estate except for the forest areas and areas under cultivation. The resulting cost of the real estate property is taxable base.
Rate of tax 0,15%
It should be paid in four equal parts before 31 March, 30 June , 30 September, 30 November. Firms which pay the tax only once, before 31 March reduce the tax by 5% .

5. Tax on refuse
The tax rate is fixed by local authorities.
*Upon the domestic housing building it is in direct proportion to the resulting cost or depending on the quantity of the waste.
*On the non-housing buildings it depends on the type and quantity of the waist containers.
*In the case that it is not possible to set the type and quantity of the containers, the tax should be fixed in direct proportion to the actual cost of the building.
On average the payment is 0,3- 0,5% of the actual cost of the buildings. It is paid together with the real estate property tax.

6. Transport tax
It is imposed on cars, buses, tractors, ships, etc.
It is paid by firms owning companies at a fixed rate.
For example, the scale for cars appears this way and depends on the power of the engine.
1. up to 50 h.p. (37 kW) incl. - 0,10 VL for h.p.
2. up to 75 h.p. (55 kW) incl. - 0,20 VL for h.p.
3. up to 100 h.p. (74 kW) incl. - 0,30 VL for h.p.
4. up to 150 h.p. (110 kW) incl. - 1,00 VL for h.p.
5. over 50 h.p (110 kW) incl. - 2,00 VL for h.p.
The tax is paid in 2 equal payments before 31 March and 30 September.
Firms which pay the tax before the first date get a reduction of 5%.

7. Income tax (from the wages of the staff)
The untaxable monthly maximum is 100 lv.
100 lv -135 lv -20% of the sum over 100 lv.
135 lv - 400 lv -7 lv +26% of the sum over 135 lv.
400 lv -1400 lv -75,90+32% of the sum over 400 lv.
over 1400 lv -395,90 lv +38% of the sum over 1400 lv.

8. Sosial and pension deductions
-pension fund
-illness or maternity leave
-employment accidents
-6% into health care fund
-4% into retraining and unemployment fund

Deductions in total: 29,0+3,0+0,7+6,0+4,0=42,7% of added wage of the employee.

Private insurance: Owners of firms /undertakers/ must deduct 29% of their wage only into the pension fund - this should be a sum equal to that of two minimum wages. At will they can deduct all kinds of social insurance mentioned above. In this case the total sum of the deductions makes 32% including that into the pension fund.