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  • Writer's pictureDarwin Tax

Company in Bulgaria: easy set-up, VAT and bank account

Bulgaria is EU member since 2007. Bulgaria features the lowest Corporate Income Tax rate in the European Union 10%. After Cyprus raised up its income tax flat rate to 12,5%, Bulgaria’s 10% rate is now officially the lowest in EU. Distribution of dividends to private persons and non-resident entities is subject to 5% withholding tax only. Wile EU resident shareholders enjoy 0% withholding tax rate as per EU Parent Subsidiary Directive.

About banks Banks are flexible to open accounts to foreign account signatories, moreover remotely on the basis of the Power of Attorney. Here you have a chance to choose even among international banks as Raffeisen, Citi Bank or UniCredit.

About VAT VAT registered companies are available. Or, we offer as well VAT registration for a new company. VAT registration is normally straightforward, but consider it might take 2-4 weeks.

About Directors If we continue comparing Bulgarian companies to Cypriot, we notice that there is no corporate requirement for the local Director or Secretary. Moreover, the Company in Bulgaria can obtain Tax Residence Certificate with a foreign Director too. However, Bulgarian Nominee Directors are offered too at comparatively low rates.

About maintenance Accounting is held according to GAAP. Rates for bookkeeping and registered office are quite affordable if we compare to other EU states. Anyone wishing to add extra substance to his Company can as well opt for virtual office, local director or employee, etc.

About taxation As we mentioned before, Corporate Income Tax rate is the lowest in EU – 10%. Unlike Cyprus, though Bulgaria is not as easy to couple with offshore companies, as transactions made to classical tax havens (like BVI, Belize, Panama, etc.) are taxed at 10%.Royalties and interests paid to non-residents are only subject to 10% withholding tax. And only 5% WHT applies within the scope of Interests & Royalty Directive.

Overall, we must admit that Bulgarian companies are easy to form and easy to deal with. This general easiness applies to everlasting problems of opening bank accounts, maintaining accounting and local nominee director services.

Finally Bulgaria is not as notorious as Cyprus.

Apply here for solution that suits your business.

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