DIVE Accounting - accounting and business services in Bulgaria

What do we need to start a business in Bulgaria?

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  10% flat-rate income tax

  lowest income tax in the European Union

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  VAT-free EU trading

  no VAT due for any trading between entities within the European Union

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  Low office costs

  prices as low as 5 EUR per m² (6 USD per m²) per month

• 

  Low labor costs

  as low as 51 EUR per month (63 USD per month) per person at minimum wage

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We at DIVE Accounting are a young team of professionals offering legal, financial, accounting and business services. As your loyal partner, we would like to introduce you to the highlights in accomplishing lasting business relations in our country.

To invest in business in Bulgaria and successfully develop it, you need a company with which to operate. In Bulgaria there are several legal forms of companies that occur under the Commerce Act, but the most preferred form of registration of a commercial entity is the limited liability companies (LLC). Depending on whether the shareholder shall be one or more individuals or legal entities, these companies are sole-proprietor and limited liability companies. You don’t need large capital to register a company in Bulgaria. Prices for registration start at 350 euros and can reach up to 600 euros depending on the choice of a company shareholder and manager selection. If you have difficulty in choosing what type of company to sign up, our lawyers will respond to your queries and help you choose the legal form of registration that will help you achieve your future goals. The actual registration of a company is easy and fast. We work with highly qualified lawyers and once they have all the necessary documents, they will manage to register your company within 3 business days.

To invest in Bulgaria means to conduct your business on the territory of our country, or to perform transactions between Bulgarian legal entity and other parties regarding the trade of goods or providing services.

One of the main advantages to invest in our country is that it is a European Union (EU) member, and as such it has simplified trading regime when conducting trades with other countries in the European Union. When you sell goods or provide services to companies registered for VAT in another EU country, you do not have to pay VAT. However, this only applies to entities with a valid VAT number in the system VIES (that is the system of the European Union for Member-States VAT registrants). For direct individual customers, VAT is paid at the rate of 20% of the cost of goods sold or the services provided. For that you need a valid Bulgarian VAT number.

Once your company is registered, it receives a unique identification number from our Commercial Register. That number is not yet valid until we move to the next step - VAT registration in Bulgaria. The registration procedure can begin immediately if you are facing mandatory registration – one such condition is trading with another company in the EU. If the VAT registration is needed, we can prepare all documents necessary for carrying out the procedure. Prices for VAT company registration vary from 90 to 150 euros, depending on whether the registration is mandatory or voluntary. Voluntary registration may be requested by any legal person who starts business activity. For additional questions about VAT registration, you can consult our accountants, who will respond quickly and adequately minding the situation of your company.

The next step for carrying out business activity in Bulgaria is finding an office and/or a warehouse, if there are goods to be stored, and finally - recruitment of staff - the most important factor for doing business. In Bulgaria you can quickly and easily find office space, while monthly rent prices vary from 200 to 500 euros depending on the location, the size and condition. The most expensive office spaces available are in the centre of the city, and the cheapest are offices in areas outside the city, because these areas are harder to access by public transport. Trusting our experience, we work with some of the largest real estate agencies in the country and we can negotiate for you, as our customer, special prices if needed. Usually when office is rented, a deposit is paid in the amount of one to three monthly rents.

The most important condition for doing business in our country is recruiting staff.

The human factor is the main factor in carrying out successful activity and implementation of the planned business objectives. In Bulgaria, the staff works through contract of employment, the working week is 5 days and the legally established working time is 8 hours per day. Currently, as of 2019, the minimum monthly wage for the country currently is 560 Levs (approximately 280 Euros or 325 USD). That means hourly rates as low as 3,50 Levs per hour (approximately 1,78 Euro per hour or 2,03 USD per hour). Insurance contributions are paid by both the employee and the employer. In percentage terms, they are divided as follows:

• 13.78% are the amounts of contributions on gross wages that are due by the employee, and 10% tax on personal income, based on the difference between the gross salary and the already calculated contributions.
• The amounts due for insurance and taxes are deducted from the salary of the employee, and with the contributions paid by the employer in the amount of 18.92% to 19.62% (depending on activity) on the gross salary, payable to the NRA.
• The amounts are due each month; the payment must be done by the 25th of the month following the month to which they relate.

Our specialists in tax law will explain the details, if you have any further questions regarding social security and tax contributions. When you are recruiting staff through employment contract, one of the basic obligations of the employer is to conclude a contract with the so called "labour medicine". Occupational health services are specialized services provided by engineers and doctors who’s task is to ensure the safety of workers. They prepare a set of documents required for the functioning of each company depending on its main activity. We, at DIVE Accounting, are working in partnership with some of the prestigious labour medicine services. If you choose us as your future partner, we will offer you a contract with the Labour Medicine Service, which agreement will ensure the smooth conduct of business in Bulgaria.