Bulgarian businesses are subject to VAT registration under specific rules. In this article you can find brief overview of the requirements for a VAT registration in Bulgaria as described by our VAT lawyers.
Mandatory VAT Registration for Taxable Turnover
Any company making supplies of goods or services taxable in Bulgaria, thus accumulating a taxable turnover of BGN 50 000 (app. EUR 25 000) or more in the last 12 months, is obligated to register for VAT purposes in Bulgaria and start charging Bulgarian VAT of 20% on its supplies.
The taxable transactions generating VAT-able turnover include not only domestic supplies of goods or services to Bulgarian clients but also exports to non-EU Member-States and supply of goods and services to non-taxable persons (e.g. private individuals) in other EU Member-States.
VAT Registration for Intra-Community Acquisitions
Even if the taxable turnover of a Bulgarian company is below the registration threshold of BGN 50 000, the company may still be liable to VAT registration under Bulgarian legislation if it receives goods dispatched from other EU Member-States by suppliers who are taxable persons registered for VAT purposes in another EU Member State. The VAT registration legal obligation arises only if the intra-Community acquisitions reach the amount of BGN 20 000 (app. EUR 10 000) for a given calendar year.
VAT Registration for Reverse-Charge Services
Generally, services supplied to another taxable person in the EU (i.e. B2B transactions) are taxable in the Member State of the customer and the latter is liable to self-charge VAT on those services under the so called “reverse-charge” mechanism. Due to the fact that such services are taxable in the country of the customer, they do not form part of the taxable turnover of a company for mandatory VAT registration purposes.
However, those businesses are subject to a special VAT registration in Bulgaria for all services supplied by the Bulgarian company to taxable persons in other EU Member States and/or received by the Bulgarian company from taxable persons established in other Member States. The VAT registration does not depend on the amount of the supplies or the turnover of the person.
Our Bulgarian law firm has extensive experience in the field of VAT registration, acts appealing, tax planning, should you have any further inquiries, do not hesitate to contact us.
The specific rules for VAT registration of foreign businesses in Bulgaria are described in detail in our vat registration of foreign businesses in bulgaria blog article.
Related links and articles:
- International company VAT Bulgaria
- Withholding tax Bulgaria
- Personal income tax in Bulgaria
- Tax audit Bulgaria