However if your business is very strict forward, transparent and you can proof that. You may not have any problems to open your new bank account and benefit from the Bulgarian lowest EU tax treatment. Great news is that Virtual Office is still very acceptable and the banks does not complaint with that.
2018 Bank Account Opening Procedure in Bulgaria
Ones you visit any branch of bank operated on the territory of Bulgaria be ready for the following list of questions:
What is the main activity of the company
Who is the beneficial owner of the company
Is there any local who can be contacted if necessary
Ones you pass this first interview you must be very strict with all you have declare. Invoicing, clients, payments from and to the account. Your account will be monitored in the first 1 year and if there differences from what you have declared first, you account can be in the risk to be closed immediately.
Normally different banks are entitled to proceed according to their terms on local or foreign clients or regarding the type of the accounts which they can open and hold. In general the most popular type of bank account remains the current bank account that serves for all kind of transactions such as depositing, storing, withdrawing and transferring money.
Other types of bank account that can be open are either an individual account or a business account (for different types of legal entity, joint stock company in the process of being set up, etc.) that can be a capital account. There are no legal restrictions on the number of the bank accounts you can open and hold in one or several banks but a certain bank may have its own policy or certain limitation.
Documents required to be presented for individuals are identity card (for a Bulgarian citizen or a EU member citizen) or another identity document such as passport (for a foreigner or a non-EU citizen) or another type of residence permit of the foreigner. This document must be presented both in original and copy.
Also some of the banks may require the foreigner to submit IBAN of an existing bank account in the foreigner’s country in order to confirm he has bank customer’s history as well as a recommendation letter, translated in Bulgarian language, from a Bulgarian who is a client of the same bank.
Bulgarian banks opens and maintains accounts and carries operations in local currency (Bulgarian levs) but also in all major foreign currencies such as Euro, US dollars, Swiss francs or British pounds both for local and foreign customers. Respectfully, money can be received into the account through cash payments or cashless transfers.
In case of opening a business account, you need also to present a Specimen of the signatures of your company. All the specimen signatures must be handwritten in front of a responsible bank employee or certified by a notary. You will also have to provide to the account an amount equal to the capital stated n the contract and in the articles of association of the company. Depending on the type of the entity the bank may require more additional documents such as a court decision to set up the company, a bank certificate, etc.
For the opened individual account the bank provides to the account holder a card containing the account number, the name of the holder, the personal identification number for the Bulgarian citizens and date of birth or personal number of the foreigner (in case he had already issued) and term of validity of the card. Most of the banks provides their customers with the online banking opportunity too by which you can execute various operations with your bank account in real time through your Internet profile on the bank website.
Banks are entitled to require opening fees or minimum amount for initial powering of a current account.
If you need someone else to operate of the funds of your current account, you must authorize the person to have the rights to dispose of this account by an authorized power of attorney.
1) Ordinance No. 3 of 18 April 2018 on the Terms and Procedure for Opening of Payment Accounts, for Execution of Payment Transactions and for Use of Payment Instruments
2) Payment Services Directive of EU of 1 January 2018 (PSD2)
In case you work as a feelancer but you want to explore Sofia , a remote worker or still planning the stages of your future start up or even if you have a big business already, choosing a coworking space option happens to be the most convinient idea for saving your capital and developing new contacts and creative opportunities.
And how to choose a co-working space in Sofia? This can be quite a challenge too, so don’t hurry before you answer some relevant questions regarding what would be the best for you or your colleagues among fitting personal requirements, budget, type and more.
1 Type of Coworking Space
What type of co-working space do you need? Coworking spaces vary accordingly to the needs of their customers. For example, If you are working in a small team than you may find appropriate leasing a whole prived serviced office. This type of office should be fully fitted with various kind of services to satisfy everyones needs in your team. If you work alone, then standard coworking space offer is for you.
2 What Rental Cost and Services Included
Sofia is budget destination, comparing with most EU cities. Rental cost and what it will cover are always important to be asked. The serviced offices require some deposit and no prepayment most often. Coworking office must have profitable membership schemes of using a coworking space only when you need, month-to-month leases, shared or flexible payment fees options that you can take advantage of or arrange it. A ready office space or coworking office should be providing an office infrastructure, enough utilities and functionality of the space. You should concider to have everything you need to maximize your productivity including access to all-in-one such as fast WIFI, prefered type of seating and desks, reception, meeting rooms, conference room, printing devices, breakout spaces, kitchen, coffee suply, etc.
3 Sofia Offices Location
Choosing a location goes as a must ask too. You should concider the transport network in Sofia and the costs of travelling to the place. It must also be close enough for your clients or other employees to visit. The central or downtown locations are usually the most wanted and adding up a sense of prestige too and value to your business.
4 Coworking Community in Sofia
By choosing your coworking space or private office in Sofia you will also choose community, future human capital as well as networking opportunities. Being surrounded by other likeminded professionals is a great benefit in attracting new talents, networking or even hiring a potential team, receiving a feedback when you need, socializing in a culture that you fit in well, following an industry development from the very heart of it and discovering brand new ideas in these hubs of innovations that unite creative people.
5 Working Environment
Growing your busineess or being productive once you accomodate yourself in a coworking space depends a lot also on the working environment. You should always visit a coworking space before you lease and be convinced that the environment will allow you to focus and think, to follow conversations with clients and meet deadlines of your projects as well as give you an opportunity to set clear goals for yourself or for your working community.
We created this article in help of all investors who want to start their business in Bulgaria. It provides all essential details that need to be known about company formations and their registration in Bulgaria.
In general, every foreigner is allowed to start a business in Bulgaria, no matter if he/she has a Bulgarian residency permit or not. The establishment of a company formation in Bulgaria is easy and straightforward. There are several types of company formations that can be registered in the country. Each of them has its individual specifics that are listed below.
Types of Company Formations in Bulgaria
An important precondition for starting a business in Bulgaria is a registration of the company in the Bulgarian Commercial Register. The Commercial Register is a single, centralized, electronic database that aims to facilitate business start-ups in the country and reduce corruption.
In accordance with the Bulgarian law the following types of company formations are present:
Lіmіtеd Lіаbіlіtу Cоmраnу
The Limited Liability company (Bulgarian: Дружество с ограничена oтговорност, short: ООД) is probably the most common and popular form of doing business in Bulgaria. The formation is also known as LLC in the USA and Ltd. in the United Kingdom. This type of company can be established by one or more shareholders who have liability limited to the amount of their deposits in the company. The Limited Liability company is a preferred type of business formation because of the minimum capital requirement of 2 BGN which is about 1 EUR.
An alternative of LLC is a single-member Limited Liability business formation (Bulgarian: Еднолично дружество с ограничена отговорност, short: ЕООД). In this case, one of the partners is holding the entire capital of the company. Foreigners can be designated as business managers.
In any case, to establish a Bulgarian LLC formation it is good to consider the following issues:
Name of the company
Scope of company’s activity
Amount of initial capital
The registration procedure of Limited Liability Company formation requires the following:
A partnership agreement in writing form. It must be signed personally by the founders or by a representative with explicit power of attorney.
Listing in the Bulgarian Commercial Register.
A deposit of the initial capital. A bank account opening is required.
An appointed manager of the company.
Registration in the Bulgarian Registry Agency.
Јоіnt-ѕtосk Cоmраnу Formation
The Joint-stock company formation (Bulgarian: Акционерно дружество, short: АД) is preferred mainly by capital companies. This option is suitable for large companies that want to start a business in Bulgaria.
The minimum capital for opening a Joint-stock in Bulgaria is 50 000 BGN (approximately 26 000 EUR). The capital is divided into shares whose owners can be both individuals and businesses. Each share certifies that its holder/s participate/s with its nominal value in the company’s capital and grants one vote for the general meeting of the shareholders.
The Joint-stock Company is liable to its creditors with its property. The company formation should have one or more registered shareholders (individuals or companies) and minimum three members of the board of directors. Shareholders are not obligated to participate in the management. As regards their responsibilities, they are regulated by the (Articles of Incorporation/Commercial Law)
For the management of a Joint-stock company are required:
1. General meeting of the shareholders;
2. Board of Directors (in case of single-staged managing system) or Supervisory Board and Management Board (when the managing system is two-stage)
To register a Joint-stock company in Bulgaria, the following is necessary:
An election of an available business name.
A Meeting of Incorporation.
Election of the Board of Directors, respectively Supervisory and Management Boards.
Deposit of the company’s capital into an opened bank account.
Listing the company in the Bulgarian Commercial Register.
Registration in the Bulgarian Registry Agency.
General Partnership (Bulgarian: Събирателно дружество, short: “с-ие”) is a type of company established by two or more persons who want to manage efficient business transactions under a shred registered trade name. The trade name should contain the family name of one or more of the partners or the trade names of their existing companies.
In general, a General Partnership formation is characterized by shared ownership, shared returns and risks, and shared governance. Thus, the partners are liable with all their assets. They may have either material or nonmaterial rights and obligations. The foremost step to register a General Partnership is to list the company in the Bulgarian Commercial Register.
Limited Partnership (Bulgarian: Kомандитно дружество, short: “КД”) type of business formation can be established by two or more persons who want to manage efficient business transactions under a shred registered trade name. A Limited Partnership is founded on the basis of a partnership contract.
The way that partners can participate in a Limited partnership is the main difference between this company formation and General Partnership. In a Limited Partnership one or more of the partners are solidary and unlimitedly liable for the company’s liabilities and the others are responsible for the amount of the contracted contribution. So partners can be general partners – the ones that bear unlimited responsibility and limited partners – the ones that have limited liabilities.
The trade name of the partnership must contain the name of at least one of the limited partners. Only general partners can register the Limited Partnership in the Bulgarian Commercial Register.
Why Starting a Business in Bulgaria
There are a lot of benefits of having an active company in Bulgaria. The country is a member of the European Union which is considered to be one of most influential economic areas in the world. As an official member, Bulgaria makes use of all the economic, political, legal, labor, environmental and consumer benefits of the union.
The tахеѕ іn Вulgаrіа аrе аmоng thе lоwеѕt іn thе ЕU whісh mаkеѕ іt оnе оf thе mоѕt favored соuntrіеѕ for business. The country has an excellent reputation for its low flat rate on the corporate and personal income which is 10%. It offers affordable setup fees and social security contributions. The value-added tax (VAT) rate at 0% within the EU is yet another good advantage of setting a company in Bulgaria. Regarding the standard VAT rate here it is 20% and the tax on dividends from company’s profit is 5%.
How to Start Business in Bulgaria
Contact us and take advantage of our incorporation services to start your company in Bulgaria. We will be glad to help you choose the most suitable company formation for your business in compliance with the Bulgarian Commercial Law.
Our team of professionals can take care of:
Preparing all necessary documents and represent you during the registration procedure
Opening a company account at bank of your choice
Administering the process of receiving Tax ID and Value Added Tax Identification number
In addition, our accountancy department can manage your financing and the preparation of all the needed reports so that you can concentrate exclusively on your business.
Year 2017 that just ended can be defined as the year of the tall buildings in the capital of Bulgaria. The skyscraper projects provoked numerous disputes, protests, and debates about the need for such tall buildings in Sofia and the chosen location for them.
In February 2017 one of the biggest projects – Grand Kanyon Sofia received a building permission. The event was followed by more plans for constructing big office buildings in Sofia including a multi-functional building (215 m) near a large mall, a project for a residential building with offices (100 m) in Lozenets and an office building project (80 m) next to Bulgaria Blvd in Borovo District. In the autumn of 2017, it was reported that there is a serious struggle against the construction of an office building (150 m) in Strelbishte District due to lack of all the necessary documents.
Conversely other two tall office buildings has gained their building permissions and both are currently under construction. One of these office buildings is located on Tsarigradsko shosse Blvd while the other is rising up in the heart of the city on Macedonia Square. The increased demand for business offices in the capital have led to the renewal of several old projects for office buildings as well. In general, the largest office building projects of 2017 in Sofia are mainly focused on good infrastructure and fast transport links, with the new metro lines which are currently in development, being the main factor.
The Today’s Office Building Projects in Sofia
Which are the present worth mention office building projects in Sofia and what will they offer us as work area and environment? Let’s take a look on them.
Grand Kanyon Sofia
Grand Kanyon Sofia is one of the biggest office building projects that will be constructed in Mladost 2 District. The building is situated right next to Alexander Malinov metro station which grants quick access to almost each city point. The investor of this huge project is the Turkish company Garanti Koza.
The project includes modern offices, two residential buildings with 700 apartments, a hotel from an international brand, an entertainment and commercial center with a cinema complex, a spa area, and a park. The investment is expected to reach 120 million leva and the launch of the site is planned for 2020.
Advance Business Center
Advance Business Center is an administrative building on 11 floors in Mladost 4 District. It is built near the Business Park and is expected to be the tallest building in the area. The project has been financed by the foreign investor Global Trade Center. The company plan to open an area of around 14,500 sq. m. with Class A offices right after the first stage of the project is completed.
The investment for the entire project is 54 million euros, and the first building is expected to be finished in April 2019. The second part of the project is awaiting a building permit.
In the very heart of Sofia, only a few meters away from the Levski monument, a hotel of a famous international hotel chain is under construction. In addition to the countless five-star luxury rooms and suites, two restaurants, two bars, and a huge spa center, the Hyatt hotel will offer a large conference hall with an area of 600 sq.m as well as five smaller meeting rooms. The common space for the organization of various business meetings and events will be 1300 sq. m. The company owner of Hyatt Hotel project is Terra Tour Service. It plans an investment of 30 million euros that will support finalizing the project during the first half of 2019.
Building Office A
Located near Tsarigradsko shosse Blvd, this office building will provide office space of the highest Class A. The building will also feature a restaurant, a café and an underground parking area. The investment is 10 million leva and the expected date of completion is December 2018.
Office Building 15
The company Arko Real Property Holding will locate its Office building 15 in the eastern part of Business Park Sofia, not far from the lake. The building features an interesting architecture and offers five levels of offices and two levels of parking lots, as well as a ground floor with shops and restaurants. The roof space will be organized as a small park. The project value is about 30 million leva and the expected date of its completion is December 2018.
Interest in Class B Office Space in Sofia
The optimistic forecasts of the business and the good economic performance in 2017 affected the office property market in Sofia. Along with the new class A office projects the interest in Class B office spaces in Sofia has also revived.
Available Office Premises and New Office Projects in Sofia
The volume of new office rents has increased by 14% in 2017 compared to the previous year 2016. The offices of class A and B available at the end of 2017 are approx. 187,000 sq.m. Under construction are approx. 340 000 sq. m. of office space that are to be completed in the current year of 2018. At the same time, in 2017 were issued building permits for offices with approx. size of 110 000 sq.m. The experts expect that by 2020-2021 another 300,000 sq. m. will be completed.
There is a slight increase in the rental rates, reaching 7-10 euro/sq.m. for Class B offices and 12-14 EUR/sq.m for Class A offices.
The preferred business locations in Sofia remain the same. The interest is towards office buildings located in the districts of Lozenets, Hladilnika, near the Business Park Sofia, around Tsarigradsko shosse Blvd., Todor Alexandrov Blvd and Bulgaria Blvd. These areas have a high percentage of already rented office space at an early stage of the projects. The demand comes from well-established companies that expand their business and from emerging companies that are starting their business in Bulgaria.
This article will help you learn how to hire foreign student to work in your Bulgarian company
Foreign students admitted to training in the Republic of Bulgaria may be employed under a contract of employment without requiring a work permit from the Labor Offices. For them, a mandatory REGISTRATION REGIME is provided for in the Ordinance on the Terms and Procedure for Issuing, Refusal and Withdrawal of Work Permits for Foreigners in the Republic of Bulgaria. – within 3 days of entering the work, the employment contract must be registered at the “Labor Office” Restrictions on working hours and the duration of the employment contract are provided. It can be: – 20 hours a week during the school year and during the official holidays announced by the school concerned – the duration of the contract may not be longer than the period of validity of the residence permit The following documents are required to register the employment contract at the Labor Office Directorate: 1. 3 copies – Declaration for carrying out short-term employment without a work permit through the registration of students in the Republic of Bulgaria under Article 38 CTRM / Annex No. 6 to Art. 34, para 1, item 1 2. Copy of the Registration Certificate at the NRA / registration of the employee – PNL or SV number / 3. A Copy of a Passport 4. Certificate of Higher Education Certificate / that is enrolled as a student for the current year / 5. A copy of the Labor Agreement 6. Actual status of the labor contracts on ……. / last day of the month preceding the month of appointment of the employee / 7. Information about the Legal Register from the Commercial Register / download from the website of the Registry Agency – Commercial Register / All documents that are not originals must be certified with – True to the original, signature and stamp.
In the second half of 2016 the offices under construction in Sofia city reached 175 000 sq.m. The offices are expected to become ready in the capital city of Bulgaria in 2017. Great deal of these new office premises are based in the main business zones of the city, along Tsarigradsko Schousse Blvd., the ring road, the Business Center in Mladost 4 District and the city center.
Even so, the trend is for decreased number of available office premises. In fact, the available offices of class A and B in the last quarter of 2016 were approximately 210 000 sq.m, which is two times less than the previous quarter. The average rental levels remain unchanged, which means 11-14 Euro/sq.m for the offices of class A and 6.5-8.5 Euros/sq.m for the offices of class B.
The government of Bulgaria have allocated additional 20 million for three of its southeastern regions, I order to build a fence along the Turkish border. The fence that is referred to as a temporary deterring installation will be set to stop the migratory pressure on the border between Turkey and Bulgaria that have been growing in the past few years. According to the press statement by the government it will also stem the wave of the refugees.
Since 2014 for more than two years, the costs for the building of the fence have surpassed 100 million BGN. In addition, the cabinet have given more money to repair the border crossing, as well as the border police equipment and stations. All those measures have been done in relation with the hope for accession of Bulgaria in the travel-free Schengen zone.
One of the major construction companies in Bulgaria will built a huge office center right in the heart of the Bulgarian capital Sofia. This will be the second phase of the Polygraphia Office Center and it is calculated at 10 million Euros. The completion of the new office project is planned for the end of the summer 2017 and is expected to provide 12 600 sq.m of Offices of the highest class A. The investment is backed up with the Bulgarian holding company AG Capital and the British Real Estate Fund Northridge Capital.
The new office building will feature six floors and an inner yard. It will be connected to the already existing office center through a solid covered passage. It will feature a parking zone on two levels with 100 parking lots. The new office building will further have an ecological certificate LEED Silver. The rental levels in that office building under construction, are expected to be around 13 Euro/sq.m.
In the end of October Romania and Bulgaria agreed that their aim to get a visa free traveling would be included in the interpretative declaration of CETA. This was an answer to the concerts that Wallonia, the Belgian region, had.
During the summit of the European Union, the Prime Minister of Bulgaria informed the press about the good news and the fact that the visa situation will be solved. Until that moment, Canada had a no visa regime with all countries from the European Union except with Bulgaria and Romania. Now the two countries do not have objection to CETA, yet they wanted to solve the visa issues they have with Canada. Different meetings have been held between the European Commission, Romania and Bulgaria, as well as Canada, aiming to solve this visa issue. Thus, since 1st December 2017 there will be no visas for residents of the two countries who want to enter Canada.
The regulation, which will come into force on 20th December will require all European Union countries to act as if one on all cases including visa matters. Romania and Bulgaria confirmed once again that they are ready for entering Schengen area for several years already, yet they have been prevented by vetos from several countries.
Various companies from UK and Russia show interest towards Sofia offices market. They are opening new branches in the capital city of Bulgaria and are one of the numerous companies that are looking for new and larger office premises. Due to that many investors have stared new office building projects in 2016, choosing locations that are within easy reach to the already established office areas in Sofia.
The new companies that are in search of offices in Sofia are looking for 700 – 800 sq.m of usable area, in office buildings of class A, placed within easy reach to the central parts of the city. Those companies are usually outsourcing their business to Sofia, or are working in the spheres of communications, financial services, information technologies, etc. Often those companies are serving not the local Bulgarian markets but clients outside the territory of the country.