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Taxes & Social Security in Bulgaria — Complete Reference (2026)

Bulgaria offers one of the lowest tax rates in the European Union — 10 % corporate tax and 10 % flat personal income tax. This reference guide provides up-to-date information on all taxes, social security contributions, thresholds and deadlines applicable in 2026.

Important Note on the 2026 Budget

IMPORTANT: As of the publication date (March 2026), the National Assembly has not adopted a budget for 2026. The extended parameters from the 2025 State Budget Act remain in force. All rates and thresholds cited in this article reflect the current legislation. The draft 2026 budget contains proposals for changes (described below) that are NOT in effect at this time.

This article will be updated immediately upon adoption of a new budget. Please check the last updated date in the sidebar.

Key Taxes in Bulgaria

Tax Rate Legal Basis Note
Corporate income tax 10 % CITA Lowest in the EU (average 21.27 %)
Personal income tax 10 % PITA Flat tax, no progressive scale
VAT — standard rate 20 % VATA Registration threshold EUR 51,130
VAT — reduced rate 9 % VATA Hotels, restaurants, baby food, books, housing (primary residence)
Dividend tax 5 % PITA / CITA Final withholding tax
Withholding tax (interest, royalties) 10 % CITA Art. 195 For payments to non-resident entities
Withholding tax (EU Directives) 0 % CITA Subject to the Interest & Royalties Directive, Parent-Subsidiary Directive

The effective tax burden with 10 % corporate tax and 5 % dividend tax is 14.5 % — significantly below the European average. Note that the dividend tax is 5 %, not 10 %.

Social Security and Health Insurance Contributions

Social security contributions in Bulgaria are shared between the employer and the employee in an approximate 60/40 ratio. The table below provides a detailed overview of the current rates:

Fund Total Employer Employee
Pension Fund (SSI) 14,8 % 8,22 % 6,58 %
Supplementary Mandatory Pension Insurance (SMPI) 5 % 2,8 % 2,2 %
General Illness and Maternity 3,5 % 2,1 % 1,4 %
Unemployment 1 % 0,6 % 0,4 %
Occupational Accident and Professional Disease 0,4–1,1 % 0,4–1,1 % —
Health Insurance (NHIF) 8 % 4,8 % 3,2 %
TOTAL 32,7–33,4 % 18,92–19,52 % 13,78 %

The specific occupational accident rate depends on the economic activity of the enterprise and is determined by Annex 2 to the SSI Budget Act.

Insurance Thresholds and Minimum Wage

Indicator Amount (EUR) Note
Minimum wage EUR 620,20 Monthly, gross (BGN 1,212.70 at the fixed rate)
Minimum insurable income EUR 550,66 For self-insured persons
Maximum insurable income EUR 2 111,64 Upper limit for social security contributions
Mandatory VAT registration threshold EUR 51 130 Annual turnover (calendar year)

The minimum insurable income for employed persons is determined by economic activity and occupational qualification group. The stated value of EUR 550.66 is the minimum for self-insured persons.

Value Added Tax (VAT)

The Bulgarian VAT Act is harmonised with Council Directive 2006/112/EC. Key parameters:

  • Standard rate: 20 % — applies to most goods and services.
  • Reduced rate: 9 % — applies to: hotel accommodation, restaurant services (food for on-premises consumption), baby food and nappies, books (including e-books), housing (purchase of primary residence under the state housing policy).
  • Zero rate: 0 % — for intra-Community supplies, exports outside the EU, international transport.
  • Mandatory registration threshold: EUR 51,130 — upon reaching turnover of EUR 51,130 for the current calendar year or for the last 12 months (whichever occurs first), the company must file a registration application within 7 days.

Voluntary VAT registration is available at any time and is recommended for companies that mainly work with EU counterparts, as it allows deduction of input VAT credits on received supplies.

Advance Tax Payments Under CITA

Companies in Bulgaria are required to make advance corporate tax payments depending on their net sales revenue for the preceding year:

Net Revenue (preceding year) Payment Type Deadline
Up to EUR 153,000 Not required —
EUR 153,000 – EUR 1,530,000 Quarterly By the 15th of the month following the quarter (excl. Q4)
Over EUR 1,530,000 Monthly By the 15th of the current month

The amount of advance payments is determined based on the projected taxable profit for the current year. If the actual profit deviates by more than 20 %, interest is payable.

Draft Budget Proposals for 2026 — NOT in Effect

ATTENTION: The measures listed below are proposals from the draft 2026 budget submitted to the National Assembly. They have NOT been adopted and are NOT in effect as of the date of publication.

The draft 2026 budget contains the following key proposals for changes:

  • Increase of the dividend tax from 5 % to 10 % — proposed doubling of the rate. As of March 2026, the tax remains at 5 %.
  • Increase of pension contributions by 2 percentage points — proposed increase of Pension Fund contributions. The 2025 rates currently remain in force.
  • Introduction of SAF-T (Standard Audit File for Tax) — a standardised format for electronic exchange of tax information between taxpayers and the NRA. Phased rollout starting with large enterprises.

We recommend monitoring the legislative process and consulting your tax adviser when planning dividend distributions and structuring remuneration.

Frequently asked questions

What is the dividend tax in Bulgaria in 2026?
The dividend tax is 5 % (final withholding tax). Despite the proposal in the draft budget to increase it to 10 %, this change has not been adopted by the National Assembly and is not in effect. As of March 2026, the rate of 5 % applies.
What social security contributions do I owe as a self-insured person?
Self-insured persons owe contributions on a chosen insurable income between the minimum (EUR 550.66) and the maximum (EUR 2,111.64). Mandatory funds include: pension (14.8 % + 5 % SMPI), health (8 %) and general illness and maternity (3.5 %, optional). The overall rate is approximately 24.3–31.3 % depending on the selected coverage.
When is VAT registration mandatory?
VAT registration is mandatory upon reaching turnover of EUR 51,130 for the current calendar year or for the last 12 consecutive months (whichever occurs first). The application must be filed within 7 days of reaching the threshold. Voluntary registration is available at any time.
Do I need to make advance corporate tax payments?
It depends on the company's net revenue for the preceding year. Companies with revenue up to EUR 153,000 are not required to make advance payments. For revenue between EUR 153,000 and EUR 1,530,000, quarterly payments apply. For revenue above EUR 1,530,000 — monthly payments. Newly incorporated companies are exempt from advance payments in their first year.

Need assistance?

The Innovires team can assist you with tax planning, optimising the social security burden and meeting all tax deadlines.