Since 2007, when Bulgaria became a member of the EU, the country has begun to create conditions for business development and provide support to foreigners. Today, Bulgaria offers a transparent company registration system, simplified taxation and the lowest income tax in Europe (10%). How to register a company in Bulgaria and what are the peculiarities of doing business in the country - read this checklist from Maira Consult lawyers.
What are the main features of registering a company in Bulgaria?
Like any other country, Bulgaria is favourable for the development of certain business areas. For example, the ideal choice would be to open a company in international trade, manufacturing or logistics/transportation. Maira Consult experts have compiled the main features of Bulgarian companies in one list:Limited liability company is the most common form of company ownership in Bulgaria.
- Taxation of Bulgarian companies for foreign entrepreneurs is set at the lowest level.
- An individual or legal entity can become the owner of a company without any residency restrictions.
- Registering a company in Bulgaria is possible only after signing the Memorandum of Association and the Articles of Association. After that, it is necessary to appoint a director.
- The required amount of the company's authorized capital is about one euro. But it is recommended to deposit at least 1000 Euros. This must be done before the company is registered.
- The liability of the owners is limited to the contributed authorized capital.
- The director of the company can only be an individual, but there are no restrictions on residency. It should also be noted that a director cannot be nominal, he or she must be aware of the situation in the company. Also, it is the director who manages the company's bank account and receives bank statements.
- The company's owner can also be a director. In this case, it is necessary to have a good command of English, as it is the most common language in the business environment of the country.
- You should know that in Bulgaria, directors do not issue general powers of attorney. To perform certain operations, such as negotiating or signing a contract, a special power of attorney is issued. It specifies what kind of transaction should be performed.
- If the director and the owner of the company are the same person, then according to EU directives, social contributions must be paid from the director's salary. They are paid even if the director does not receive a salary. However, if the director and the owner are different people, then there is no need to pay social contributions.
- The company should hire a local licensed accountant to do all the accounting.
What do you need to know about taxes in Bulgaria?
Maira Consult has compiled a list of the main taxes that companies in Bulgaria have to pay:
- Income tax - 10%. It is paid depending on the company's turnover (monthly or quarterly).
- Tax on dividends from subsidiaries - 5%.
- Tax on dividends transferred by the company to owners - 5% or 10%. The percentage depends on the existing double taxation treaties with the country to which the dividends will be transferred. After receiving a VAT number, the company must submit a report on a monthly basis. Even if there is no activity in this direction.
Bulgarian companies must keep accounting records and submit a financial report annually. The latter are signed by both the accountant and the director of the company. It is necessary to submit financial statements even if the company has not conducted any activities.
How to register a company in Bulgaria with Maira Consult?
To register a company in Bulgaria, its owner must visit the country in person or have the documents certified by the Bulgarian Embassy. How register a company in Bulgaria, Maira Consult experts will tell you step by step:
- Choose the form of company ownership and its type of activity by adding this information to the company's charter.
- Assist in signing the company's constituent documents (directly in Bulgaria or in the home country).
- Open a temporary account in a local bank to deposit the share capital. This should be done personally by the director.
- Help to obtain a VAT number after the company is opened.
- Help to open a permanent account for the authorized capital deposit. It is also necessary to have an account with the national currency of Bulgaria.
If you want to register a company in Bulgaria with the help of Maira Consult, sign up for a consultation. At a personal reception, you will learn about all the advantages of companies in this jurisdiction, the minimum price for registration and many different nuances of doing business in the country.
