Starting a business in
🇧🇬Bulgaria
Checked November 4, 2026 · How we score
Corporate tax
10%
Top income tax
10%
Setup from
$1,200
all-in, first year
Time to form
7 days
can be done remotely
Taxes in Bulgaria
| Corporate income tax | 10% Flat 10% corporate income tax, the lowest headline rate in the EU. Pillar Two 15% top-up applies only to very large groups. A proposed rise in the dividend rate to 10% in the 2026 budget draft was dropped. |
|---|---|
| Personal income tax (top) | 10% Flat 10% on employment, business and most other income. Self-employed and employees also pay social and health contributions up to a monthly insurable income ceiling of about EUR 2,100. |
| Tax system | Worldwide income |
| Capital gains tax | 10%10% on gains from sale of shares and property; gains on EU-regulated-market securities are exempt for individuals. |
| Dividend withholding (non-residents) | 5% |
| VAT / GST | 20% |
| Social security | Total contributions about 32%–33% of gross salary (employee about 13.8%, employer about 19%), capped at about EUR 2,100/month. Dividends carry no social contributions. Minimum wage EUR 620 per month from 2026. |
Forming a company in Bulgaria
| Usual entity | EOOD / OOD (limited liability company) |
|---|---|
| Minimum capital | $1 |
| Setup cost (all-in) | $1,200–$2,800 |
| Annual running cost | $1,200–$3,500 |
| Time to incorporate | 7 days |
| Form remotely as a foreigner | Yes |
| Local director required | No |
| Local address required | Yes |
| Owners on public register | Yes |
| Statutory audit for small companies | No |
| Business banking for non-residents | Moderate |
Residency and visas
EU citizens move freely; non-EU nationals usually need a work or business-based D visa or a long-term residence permit through a company with local hires. Bulgaria's citizenship-by-investment programme ended in 2022.
| Digital nomad visa | No |
|---|---|
| Golden visa | No |
| Ease of residency for founders | 3/5 (1 = easiest) |
Special tax regimes
10% flat tax system
A single 10% rate for corporate and personal income, plus 5% dividend tax, with social contributions as the main burden.
Investor Class A/B certificates
Tax incentives (reduced corporate tax in high-unemployment areas) and fast-track approvals for large investments.
Micro-enterprise and sole trader options
Freelancers can use presumed expenses (25%–40%) when taxed as sole traders under the Personal Income Tax Act.
Pros and cons
Why founders pick Bulgaria
- 10% corporate and personal income tax
- 5% dividend tax and no social contributions on dividends
- Low cost of living and labour
- EU member and euro adopter (since 2026)
Watch out for
- Social contributions of ~32% on salaries
- Bureaucracy, notarised documents and Bulgarian-language filings
- Non-resident bank accounts and payment processors can be slow
- Weaker international reputation than Western Europe
- Dividend tax on non-resident shareholders may rise in future budgets
Best for: Startups wanting the lowest headline tax rates in the EU · Dev outsourcing and shared service centres · Freelancers able to use the 10% flat tax
Bulgaria: common questions
What is the corporate tax rate in Bulgaria?
A flat 10%, the lowest headline rate in the EU. A further 5% tax is withheld on dividends paid to individuals and non-EU companies, giving a combined burden of about 14.5%.
Can a foreigner open a company in Bulgaria remotely?
Yes. Foreigners can register an EOOD/OOD through a lawyer with a notarised power of attorney, so a visit is not required. You need a Bulgarian registered address, and registration with the Commercial Register takes about 3–7 days.
Did Bulgaria raise its dividend tax in 2026?
A draft 2026 budget proposed lifting it from 5% to 10%, but the proposal was withdrawn after protests and the 5% rate remains. Check the current budget law before planning.
How much are social contributions in Bulgaria?
About 32%–33% of salary for employers and employees combined, capped at roughly EUR 2,100 of monthly gross pay. Self-employed pay about 27.8% on declared income.
Is Bulgaria a good place for a one-person company?
It can be: 10% on profits plus 5% on dividends is very low, and a director can pay themselves a small salary to limit contributions. The trade-offs are bureaucracy and banking friction for non-residents.
Sources
Compare Bulgaria
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Not tax or legal advice. Rates and rules change; we check official sources and update every page, but verify with a licensed adviser in the country before acting. Spotted something out of date? Use the correction form below.