VAT Registration

BULGARIAN VAT REGISTRATION

Bulgarian tax legislation has provisions for two main types of VAT registration – obligatory and voluntary. In general, taxable persons are legally bound to register for VAT purposes once their taxable gross income reaches BGN 50 000 (≈ 25 560 EUR) for the last 12 consecutive months.

Voluntary VAT registration and its benefits

However, each company performing independent economic activity may apply for voluntarily VAT registration at any time from the first day of its corporate registration as long as it has not reached the above threshold.

The voluntary registration is a general one and allows a deduction for any input VAT due by the recipient of supplies of goods and/or services used for further performance of taxable supplies. It is recommendable for any company the activity of which covers more than VAT exempt supplies such as financial, insurance, health, educational, etc. services.

Our experience shows that the immediate voluntary VAT registration is highly recommended for any new company which already performs or is planning to perform taxable supplies and:

  • Needs to make substantial initial investments in goods and services to be used for performance of its future taxable supplies. If VAT registered, the company will be entitled to deduct the input VAT due in respect of those goods or services; and/or
  • Plans shortly after its incorporation to: 1) perform intra-community acquisitions of goods the total amount of which will go over BGN 20 000 (≈ 10 220 EUR) within a given calendar year, and/or 2) obtain taxable services with place of supply in Bulgaria for which the company as recipient should self-charge VAT, and/or 3) perform services with place of supply in another EU member state. The reason is that if your company obtains/performs any of the above goods and/or services without already having VAT registration it has to apply for a special one which does not give right to VAT credit due for the related input supplies.

For our clients who are planning to invest in a Bulgarian company the activity of which will cover any of the hypotheses we offer two alternative solutions:

  • Purchase of a VAT registered ready-made company. This service saves our clients a lot of time and money related to the administrative obligations related to a VAT registration: drafting documents, certifications and/or apostille, filing, dealing with the tax authorities, etc. Buying a VAT registered ready-made company allows you to start immediately any actions related to the taxable activity of your investment; or
  • Services related to the voluntary VAT registration of your newly incorporated company. We will take care of all related steps and will save you the related hustle and battle with the tax administration.

What's included in our service

  • Preparation of the documents for VAT registration (accounting documents of the company, application forms and declarations)
  • Our officers will proceed as duly authorised representatives of your company and will represent it for the purposes of filling the application for VAT registration, as well as the audits performed by the NRA
  • Receipt of the VAT registration certificate

FREQUENTLY ASKED QUESTIONS

VAT registration is not required if the turnover is up to BGN 50 000. However, there is a requirement that if a company provides services to VAT-registered customers from another EU Member State, it must be registered for VAT seven days prior to the service, its invoicing, and payment. If the company is not VAT registered, VAT will be charged on the invoice for purchases from the EU. When a Bulgarian company that is VAT registered carries out transactions with VAT-registered companies in another EU Member State, VAT is not charged. For services from third parties (non-EU Member States), VAT is not due. In the case of transactions with third parties with goods, customs must be passed.
After submitting an application for VAT registration within seven days, the requested documents from the National Revenue Agency must be submitted, which include a turnover statement 12 months before the current one, bank statements at the time of filing the application, contract for using of the address of registration in the Commercial Register of the company, an accounting service contract, and a power of attorney. After submitting all the documents to the NRA, the person is registered for VAT up to seven days.
All purchase invoices, sales invoices, and bank statements must be sent until 10th of the month. The VAT declaration is submitted by the 14th of the following month.
VAT refunds are made three months after the first refund occurs.