Corporate Tax in Bulgaria: What Company Owners Pay in 2026

Corporate tax in Bulgaria is a flat 10% on taxable profit. That rate is why many founders compare a Bulgarian company with bases in Western Europe. This guide explains the Bulgaria corporate tax rate, how dividends are taxed, when VAT registration starts, and what you still have to file after the company is registered. Figures below describe the standard rules for 2026. Your result depends on activity, residency, and any double-tax treaty — confirm it before you rely on a headline rate.

Bulgaria corporate tax rate

The corporate income tax rate is 10%. It is charged on taxable profit, not on revenue. A company with €100,000 of taxable profit owes €10,000 in corporate tax. A company that breaks even owes no corporate tax for that year.

The rate has been flat for years and did not change when Bulgaria adopted the euro on 1 January 2026. The tax period for a Bulgarian company is the calendar year. A company formed during the year is taxed from the registration date through 31 December.

Taxable profit starts from the accounting result and is then adjusted under the Corporate Income Tax Act. Some expenses are not deductible, and some income is left out of the tax base. That is why bookkeeping has to follow Bulgarian rules from the first invoice, not only at year end.

What a Bulgarian company typically pays

• 10% corporate income tax on taxable profit
• 5% withholding tax on dividends paid to an individual, in the standard case
• 10% personal income tax on employment income paid in Bulgaria
• 20% standard VAT on most domestic supplies, once the company is VAT-registered

If profit is distributed to an individual after corporate tax, the combined burden is 14.5%, not 15%. On €100 of taxable profit the company pays €10. The remaining €90 is the dividend, and 5% of that is €4.50. Together that is €14.50.

An EU or EEA parent company can qualify for a 0% withholding rate on dividends when the statutory conditions are met. A non-resident individual may pay less than 5% if a double-tax treaty sets a lower rate and the relief is claimed correctly. Capital gains on shares can also be exempt in specific cases. None of these outcomes is automatic.

A wider look at why founders use this framework inside the EU is in Bulgarian business advantages.

Bulgaria company tax is not the same as VAT

Corporate tax and VAT answer different questions. Corporate tax is on profit. VAT is on supplies, and the customer usually bears it. Mixing the two is the most common mistake when people model a Bulgaria company tax bill.

In 2026 the standard VAT rate is 20%. A reduced 9% rate applies to a short list of supplies, including hotel accommodation. Qualifying intra-EU business supplies can be invoiced at 0% once the company has a valid VAT number and the customer is listed correctly.

When VAT registration becomes mandatory

Mandatory registration applies when taxable turnover exceeds €51,130 in a calendar year (1 January–31 December). The application must be filed within 7 days of crossing that line, and registration takes effect from the following day. The old rolling 12-month test no longer applies.

Two other paths matter for foreign-owned companies:

• Voluntary registration at any turnover, which is useful when your customers are VAT-registered businesses that can recover the VAT you charge
• Earlier registration for EU services. A company that supplies services to businesses in other EU countries often needs a VAT number before the first such supply, even below €51,130. That registration is not always the same as full domestic registration with a right to deduct input VAT

EU VAT (VIES) registration is available as part of company formation when the activity qualifies, or on its own. Details are on our additional services page.

Bulgarian company taxes for non-residents

The company pays the 10%. You do not need Bulgarian residency or citizenship to own an EOOD or OOD. Ownership and the place where you live are separate questions:

• Profit of the Bulgarian company is taxed in Bulgaria at 10%
• Dividends you receive may also be taxed where you are resident
• A treaty usually decides which country taxes the dividend and whether Bulgaria’s 5% is reduced or credited
• If you manage the company in a way that creates a taxable presence in another country, that country may tax part of the profit as well

Remote ownership is normal. Remote management without checking where decisions are made is not. If you want the company itself, start with how foreigners register a company in Bulgaria.

Annual filing after you incorporate

A low rate does not remove the filings. A typical Bulgarian company:

• Keeps accounts under the Bulgarian Accountancy Act
• Files an annual corporate tax return, generally by 30 June of the following year
• Files annual financial statements with the Commercial Register on the statutory deadline
• Pays monthly or quarterly advance corporate tax if last year’s revenue is above the threshold that triggers advances
• Files VAT returns on the assigned schedule if it is VAT-registered

Payroll and social security apply when the company pays a salary or a management fee in Bulgaria. An unpaid foreign owner is a different case from a locally employed director. We provide bookkeeping and tax filings after setup; the scope is covered in the FAQ.

How the tax fits the cost of forming the company

The 10% rate is the ongoing cost. Formation is separate. Turnkey company formation starts at €1,700 in person in Sofia and €2,000 remotely, including the registered address, tax setup, and bank-account coordination. After that, budget for accounting, the address renewal, and VAT compliance if you register.

For the incorporation steps themselves, see how to open a company in Bulgaria.

Common questions about corporate tax in Bulgaria

What is the corporate tax rate in Bulgaria?

A flat 10% on taxable profit. The rate applies for the calendar year and did not change with the euro.

How are dividends taxed in Bulgaria?

Dividends to an individual are generally withheld at 5%. Combined with the 10% already paid on profit, the burden on a full distribution to an individual is 14.5%. An EU or EEA parent company may qualify for an exemption. A treaty can lower the rate for some non-residents.

When must a Bulgarian company register for VAT?

When taxable turnover exceeds €51,130 in a calendar year, with an application within 7 days. EU B2B services can require a VAT number earlier. Voluntary registration is available at any turnover.

Do foreign owners pay Bulgarian corporate tax?

The company pays 10% on its Bulgarian taxable profit. Foreign owners can hold the shares without living in Bulgaria. Tax on the dividend, and any tax in the owner’s home country, depends on the shareholder and the treaty.

What taxes does a Bulgarian company pay if the owner is a non-resident?

The same as any Bulgarian company: 10% corporate tax on profit, VAT if registered, and 5% withholding on dividends to individuals unless a tax treaty or EU rule reduces it. The owner’s personal tax depends on their country of residence.