Category: Company registration Bulgaria

The outsourcing business in Bulgaria has good perspectives ( Updates 2019)

Mina Boycheva 26/03/2019

The newly established Bulgarian Outsourcing Association made prognosis for a stable increase in the number of companies that plan to outsource their business to Bulgaria. These companies be registered in Sofia and could come from many spheres of activity. The new association predicted that the increase in the number of companies will be around three times in the next five years. The outsourcing business is considered among the most dynamic industries in the country and currently it employs around 15 000 people in the capital. Their number is expected to triple according to the five year prognosis. The stable political situation, the low taxes and the acceptable wages in the country, the professional skills of the employees, as well as its being part of the European Union, make Bulgaria an attractive destination for the large and stable companies in Western Europe and the United States. These companies will look for business centers with offices of the highest class, which have central and convenient locations and perfect infrastructure, besides offering an impressive range of services and facilities. It is believed that these big companies will later open other offices throughout the country in cities like Varna and Bourgas, Plovdiv and Rousse.

The outsourcing business is considered among the most dynamic industries in the country and currently it employs around 15 000 people in the capital. Their number is expected to triple according to the five year prognosis.

Among the founders of the Bulgarian Outsourcing Association are companies like Coca-Cola Hellenic IT Services, AII Data Processing, Sofica Group, Atos Bulgaria and Bulpros. They believe that if the state and the companies join their forces, this will lead to a stable development of that industry sphere. If the proper activities are arranged and successful policies are followed, then Bulgaria can become one of the top ten destinations for outsourcing. Special attention has to be paid to the professionals who apply for work in these outsourcing companies. Usually, these are people with a lot of knowledge and skills, but they still need training in certain spheres. It is not a secret at all that some of the largest outsourcing companies that are working in Bulgaria are in direct connection with the universities where they look for ambitious students. They try to attract the talented ones and offer them a job before they head to a carrier abroad. There is potential in the rest of the big cities in the country besides Sofia, where there are no such projects and opportunities, but there are still good professionals. The outsourcing industry is in demand for different types of employees – from recent graduates to managers and strictly qualified professionals.

In general, Bulgaria has excellent reputation among the companies in the outsourcing business and it will continue to attract them. The reasons for that are not only the membership of the country in the European Union, but also the tax alleviations and the desire for less bureaucracy.

In general, Bulgaria has excellent reputation among the companies in the outsourcing business and it will continue to attract them. The reasons for that are not only the membership of the country in the European Union, but also the tax alleviations and the desire for less bureaucracy. Of course, we should also mention the welcoming atmosphere, the excellent infrastructure and the construction of business centers with prestige location that correspond to the needs and the requirements that are important to the foreign investors.

Read More

How To Hire Foreign Student in Bulgaria in 2019

Mina Boycheva 26/03/2019

This article will help you learn how to hire foreign student to work in your Bulgarian company in 2019

  • 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.
Read More

Company Formation Bulgaria – What You Need to Know

Mina Boycheva 30/01/2018

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
    Partner/s
    Scope of company’s activity
    Registered address
    Amount of initial capital
    Manager/s

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

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

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.

Read More

Do You Need Our Payroll Services?

Mina Boycheva 25/03/2016

Bulgaria is а well-known destination for outsourcing services already. The country is known for its wide range of advantages that it offers to the local and the international investors. Prior to starting a business in the country, those investors need to decide about the type of business they will need to set up. According to the Bulgarian laws, citizens from abroad have the right to establish a business in the country in the form of sole proprietorship, a representative office, a partnership, a branch.

The team behind SofiaOffices company has been on the market for many years and is quite aware that the businesses in Bulgaria have diverse payroll needs. That is why the company started providing fast and accurate online payroll services to those clients that need them. Bulgaria has strong market potential and attracts the interest of many investors. Just like the rest of the European countries, it has however its own employment legislative subtleties. If wisely observed, these regulations ensure that your outsourced workforce in Bulgaria is nicely managed and paid accordingly. StaySofia has the capacity to provide employment and payroll outsourcing services on time, as well as business support.

The team behind SofiaOffices company has been on the market for many years and is quite aware that the businesses in Bulgaria have diverse payroll needs.

In order the work to be done fluently, every business company is in need of administrative and payroll services. This is a boring job (yeah, we know) that brings no profit (but is associated with expenses instead). Yet, someone should do it, so it is always better to leave that task in our hands and focus on what you do best. Among the administrative services that we provide is the preparation of all documents associated with the start of the employment process of every employee, including the registration of the labor contracts in the National Revenue Agency, and all other documents that concern the change in the employment status, the retirement, the cash benefits and the social assistance documents. The maintenance of the employees’ records in perfect condition is also part of the task.

The payroll services that SofiaOffices cover include all important aspects that concern the payment of the employees in Bulgaria. These include the process of the variable monthly payroll information, calculation of the vacation days and sick leaves, changes in the wages, method of remuneration, working positions, calculation of the monthly gross and net wages, social and health insurances, income tax, etc.

Payroll Services in Bulgaria Milestones:
• Minimum wage – 210 EUR
• Employer’s taxes – 30.7%
• VAT – 20%
• PIT – 10%
• Annual paid vacation – at least 20 days
• Payroll currency – BGN, Euro, Dollar
• Overtime – Working overtime is principally not allowed by the Labour Code) with exceptions only under tight premise. The extent of overtime must not exceed 6 h (night work 4 h) per week, 30 h (night work 20 h) per month and 150 h per year. During two consecutive days no more than a total of 3 hours (night work 2) overtime are allowed. The premiums amount to minimum of: – 50% for work on regular working days; -75% for work on days of rest (Sundays); – 100% on statutory holidays.

Read More

Company registration and opening of an office in Sofia city

Mina Boycheva 31/05/2013

Investors who want to start their business in Bulgaria and find its Sofia a great destination for outsourcing their business will be pleased to find out the various positive aspects of Sofia city. The capital of Bulgaria provides several very good office buildings of the highest class A, as well as numerous professionals that can help them with consulting and company registration, financing and taxation process. Investors who want to register their company in Sofia will be able to choose from joint stock companies, limited liability companies and sole trader enterprises, depending on their purposes and intentions. They will have to complete a pack of documents, prepared according to the legislation of Bulgaria. The company registration includes reservation of a company name, opening of a company bank account, signing of power of attorney, registration at the National Insurance Institute, National Statistical Institute, Local Tax Authority and the Commercial Register.

Once the company is registered, then comes the sweet but also hard part and that is to find a suitable Sofia office that corresponds to the business intention and needs. In the city of Sofia could be found excellent offices that correspond to all requirements for class A office premises.

Once the company is registered, then comes the sweet but also hard part and that is to find a suitable Sofia office that corresponds to the business intention and needs. As mentioned above, in the city of Sofia could be found excellent offices that correspond to all requirements for class A office premises. Most of the Sofia offices are organized in the Business Park Sofia in Mladost District, along Bulgaria Blvd. and Tsarigradsko Shousse Blvd., as well as in the center of the city and in Lozenets District.

Read More

The taxes applied on the registered companies in Bulgaria

Mina Boycheva 30/05/2013

Whether renting an office in Sofia, the rest of the big cities like Varna, Plovdiv and Bourgas, all companies that are registered in Bulgaria and operate here should work according to the regulation of the Bulgarian law and legislation system. At the same time, they have to follow the European laws as well, as the country is a member state of the European Union. The managers of all companies that are registered in Bulgaria should know that the tax management process is important part of the accounting and the financial activity of every company. It has direct connection with the profit and the investments that the company can do.

Whether renting an office in Sofia, the rest of the big cities like Varna, Plovdiv and Bourgas, all companies that are registered in Bulgaria and operate here should work according to the regulation of the Bulgarian law and legislation system.

Companies that are registered and operate on the territory of Bulgaria should use a company providing tax accounting services or should hire own accountant. The services mentioned include the modeling of the tax rate, the handling of the tax documentation, the tax assistance and the tax analysis, but also a forecast for the income tax, which is important. Other aspects that should be covered include analysis of data, evaluations of tax returns, tax liability reduction planning, VAT book keeping, etc. The companies being registered and operating in Bulgaria, which have an office in Sofia or elsewhere or do have a car, should also pay immovable and movable property taxation. The companies that are registered in Bulgaria and operate here should further cover national insurance for the employees.

Read More

Tax planning in Bulgaria

Mina Boycheva 14/01/2013

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.

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.

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 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.

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.

Read More

Bulgaria is appealing for the outsourcing companies

Mina Boycheva 27/12/2012

For several years already Bulgaria keeps on being quite appealing for the outsourcing companies. This sphere of business in Sofia and the rest of the big cities in Bulgaria is generating significant income for the international companies that have decided to make this step. According to the British newspaper “Financial Times”, this sector employs more than 15 000 people in the country. Although not as famous outsourcing destinations as the Philippines or India for example, Bulgaria and the city of Sofia in particular attract investors due to several factors. Among them are the good location, the professional and well trained staff and the relatively low wages. Many popular and large international companies have already opened and successfully run their outsourcing centers in Bulgaria. Among the leading ones are such solid companies like Hewlett-Packard and IBM, Coca-Cola, as well as Telus – the Canadian company, which bought part of the Bulgarian company CallPoint New Europ.

Many popular and large international companies have already opened and successfully run their outsourcing centers in Bulgaria. Among the leading ones are such solid companies like Hewlett-Packard and IBM, Coca-Cola.

Outsourcing sector in Sofia is open to anything that will make the work easier and the employees – satisfied. The goal is for the work to be done and the customer to receive what one paid for. The outsourcing companies, like all other companies, have certain positions that do not require the employees to work from the office. The outsourcing sector welcomes this idea and this opportunity and even encourages some employees to work from home and visit the office once or twice a week. In this way they save time and money for travelling. These outsourcing companies also have open positions to part time employees and are happy to hire people with disabilities. After all, we all live in an era where one needs a computer, a telephone and a good Internet connection in order to do one’s work. The outsourcing companies appreciate the general knowledge of their employees and their great professionalism, and cherish the knowledge of different languages. It is this knowledge of languages make Bulgaria stand out from the other countries that are destinations for outsourcing. That is why we have to put our emphasis on this. In conclusion, Bulgaria is expected to attract many new outsourcing companies in the future. Young people will have the opportunity to benefit from the knowledge and skills that they have, to learn how to take risks and to set the basis for their career growth.

The outsourcing companies, like all other companies, have certain positions that do not require the employees to work from the office.

The outsourcing sector is driven by the state in many direct and indirect ways. These include infrastructure improvements and tax exemptions, logistics support and training of the personnel. Those major players who wish to register a company in the country and operate their business from Sofia are further encouraged to do so by the relatively low wage costs. In an interview that was published by Economy.bg, Mr. Joseph Lazarus, the manager of IBM Global Delivery Center Bulgaria, stated that at present Bulgaria provides the right balance of talented and ambitious professionals with experience and reasonable costs. The big companies that decided to outsource their business to Bulgaria have invested a lot of energy and money here in order to expand their business and offer competitive products and services. Big obstacles in the expansion of their business are the costs and taxes they have to pay, but this is a sphere that could be interfered with government's changes.

Read More

2013: what to expect from the office market

Mina Boycheva 21/12/2012

Now that year 2013 is ahead of us, many are wondering what to expect from the office market in the next twelve months. According to the research, the main driving force will most probably be the foreign companies which work in the production and services sphere, as well as the outsourcing companies. These will most probably be registered companies in Bulgaria, which will pay taxes here and will hire local employees. The big international companies are focused on the optimization of their expenses and that is why they will keep on searching for other ways and countries to make business. These will be destinations, where the political situation is stable, the tax levels are low and the sums for salaries are affordable for them to cover.

The big international companies are focused on the optimization of their expenses and that is why they will keep on searching for other ways and countries to make business.

This tendency has already started in Bulgaria and will be valid for the next year as well. Bulgaria, and especially its capital Sofia, as well as other of the major cities like Plovdiv, Varna and Bourgas, will put efforts into creating corporate business centers, which will be modern, with the required facilities and prestige city address. These business centers will be of the highest class A and will answer the requirements of the international companies that plan to operate here. These will be IT and HR companies, accounting companies, logistic companies, express services, call centers and companies that offer different administrative activities and services. Besides the already existing outsourcing companies, there will be new ones that will emerge on the market and this will lead to demand for new working places in modern offices. Big investments are also expected in the industrial sector, which will be stirred by companies that want to relocate their production to Bulgaria and reduce their expenses made in the process of production.

Besides the already existing outsourcing companies, there will be new ones that will emerge on the market and this will lead to demand for new working places in modern offices.

The rented offices in Sofia during the first nine months of 2012 amounted to 71 150 sq.m, which is with 50 % more if compared to the same period the previous year and with almost 18 % more when compared to year 2010. In year 2012 the tendency of the big companies to expand their business to Bulgaria continued. Companies like Coca-Cola Enterprise and Ingram Micro are just two of the companies that set the example. The bank sector was also busy moving offices. Two of the bank institutions, Alpha Bank and Post Bank moved to new head offices in modern office buildings of their own. In general, the companies are looking for office buildings of the high class, with the required facilities. Some of the companies are searching for top locations in the city center, others are looking for the business zones along “Bulgaria” Blvd. and “Tsarigradsko Schousse”, while others are considering the new office building “Sofia Airport Center”. The rental levels are varying between 9 and 15 Euro per sq.m., depending on the location and the class of the office building. According to the statements of the experts and their prognoses, the offices that will come into operation in year 2013 will amount to almost 28 000 sq.m.

Read More

More investments in Bulgaria during 2012

Mina Boycheva 19/12/2012

According to the recent analyses of the National Statistics Institute and the leading media, the business climate in Bulgaria is good and faces an increase of almost one percent in November compared to its level in October. The expectations of the managers in the industry sphere and in the sphere of services are for an increase with 3.5 per cent during December. A great part of the contractors plan to freeze the prices for the next three months. In general, Bulgaria and especially Sofia city keep their stable positions when the investment in office centers and trade buildings is concerned. There are several reasons for that. Bulgaria is in stable economic position and political situation. The country is also a member of the European Union. All these premises lead to an increase of 4.3 % in the investments during year 2012 compared to the investments made during the previous year 2011. The prognoses for year 2013 are for an increase in the investments made in the light and heavy industry including the processes of mechanization, automation, new production technologies, etc. The tendencies are for registration of companies in Bulgaria which trade with the European Union, but also with Turkey and China, Russia and USA, Serbia and Macedonia. The direct investments made in the country during the first nine months of the year are estimated at almost 972 million Euro, compared to the 712 million Euro for the same period in 2011. Great deal of investments was made from registered companies from The Netherlands, Switzerland and Russia.

According to the recent analyses of the National Statistics Institute and the leading media, the business climate in Bulgaria is good and faces an increase of almost one percent in November compared to its level in October. The expectations of the managers in the industry sphere and in the sphere of services are for an increase with 3.5 per cent during December.

In August 2012 it became clear that the Finance Minister of Bulgaria, Mr. Simeon Dyankov, stated that there will not be an increase in the value added tax in the end of 2012. In his statement however, he added that such a change is possible by the end of 2013. The Finance Minister also stated that our country does not approve the European Union tax harmonization and will not support it. This is so, as the country needs its flat tax, which amounts to 10 %, in order to be stable and to have an economic growth. Actually, the plans of this minister are for the flat tax to remain for the next ten or even fifteen years. The predictable policy of the government, as well as the stable political situation, make the country look quite appealing to the foreign investors. Many big companies are now looking towards Bulgaria and plan to outsource their business here or at least certain specific branches of their business. The good news is that the country can offer them stability and excellent infrastructure, as well as reasonable tax policy and option to register companies in Bulgaria. The other assets of the country, which are concentrated in the capital Sofia are the talented and experienced professionals, as well as the business centers of the highest class, which enjoy central and prestige locations and business addresses.

Read More