Tax planning in Bulgaria

All good company managers know that once the company is registered and the office is available, they have to look for a good accountant or an entire accounting company that will take care of the taxes. The accountants will be able to plan all corporate taxes of the company. These include the value added tax (VAT), the income tax, the tax impact on the business and the dividends tax. Actually, the accountants will play a vital role in the company’s life and in every financial move in Bulgaria that has to be done. That is why getting an experienced accountant or a professional accountant company that can offer comprehensive consultation on all taxes in the country and the changes they often go through is important. These accountants will be able to keep the tracks of the monthly expenses of the office, but will also provide the managers with tax information on the Bulgarian tax rates, the due dates for these taxes, as well as the so called process of tax planning. They will be able to support the company with information that concern the applicable VAT in Bulgaria and the VAT registration, and shall be able to represent the company before several national institutions or take care of the property tax.

Currently Bulgaria offers good and acceptable income tax system, which is the lowest one within the tax rates of the European Union. This tax rate is 10 % for corporate tax and withholding tax rate for the non-residents. There is also 5 % tax rate on dividends and tax from shares. The VAT rate is 20 % and there are no plans for its reduction at the moment. There is a reduced rate of VAT that amounts to 9 % for the hotel accommodations and the tourism sector. The good accountant will be able to inform the managers of the company in advance, so that they can use the most profitable way of making business and handling the tax liabilities of the registered company in Bulgaria.

The plans of the Finance Minister Simeon Dyankov include imposing of a 10 % tax on the income from the bank deposits and other taxes on the profit from the stock exchange in year 2013. These measures are taken by the government, as it aims to ensure an equal tax treatment over the income which actually underlines the idea of the flat rate. The plans of the Finance Minister do not include aligning of the tax rates with the rates that are implied in the other European Union countries. On the contrary, he put a stress that he plans to preserve the low taxation in Bulgaria. The stable politics that concern the taxes in Bulgaria and the new changes to the better that are expected in year 2013 are great news for the companies that are still hesitating whether to open offices in Sofia and other cities in Bulgaria.