Closing a company in Bulgaria: liquidation step by step

Companies and taxes · Last reviewed: 2026-08-26

Close it or put it to sleep: decide this first

The first question is not „how do I close“ but „should I really close“ — because Bulgaria also has an established regime for keeping a dormant company. A company that has stopped trading can „sleep“, provided the annual no-activity declaration is filed; for someone who knows they will return after a short break, this path is cheaper and lighter than liquidation. But dormancy is not closure: the company keeps existing in law, your capacity as manager continues, the address and bank obligations do not vanish, and the small omissions that pile up over the years — a missed filing, an unupdated address — come back as fines. If you know you will not return, the right path is liquidation: it costs money and takes months, but at the end the company is struck off the register and the ledger truly closes.

There is also a third path: selling or transferring the company instead of closing it. A share transfer is faster than liquidation; but who the buyer is matters — trying to shed a debt-laden company onto a „straw buyer“ is a minefield legally and ethically, and it does not automatically erase the old manager's responsibility. If there is no genuine buyer, do not force this route; this article is about closing honestly.

The map of the three procedures

In Bulgarian law a company's end runs along three main paths. Liquidation: the company can pay its debts and is closed by the shareholders' decision — the subject of this article. Insolvency (несъстоятелност): the company cannot pay and enters a separate court-run procedure; it must not be confused with liquidation — there is no „quiet liquidation“ for a company drowning in debt, and if during liquidation it turns out the debts cannot be paid, the case shifts to insolvency. Expedited liquidation: the shortened procedure added to the law for companies without recent activity or staff — covered in its own section below. The single question that decides your path: can all the company's debts be paid in full out of its assets?

The logic of liquidation: protecting creditors

The backbone of the procedure is a waiting regime that prevents shareholders from taking the money and disappearing. The winding-up is announced in the Commercial Register and an invitation to creditors is published: all creditors, whether their claims are due or not, are invited to present them — and the liquidator additionally notifies known creditors in writing. The law's rule is plain: the company's assets may not be distributed to the shareholders before at least 6 months have passed from the publication of the invitation. That period is the window in which a distant supplier, a former employee or the revenue agency can say „I have a claim too“. The 6-month rule was verified from official sources as of 26 August 2026; check the current value on the official page.

Step by step: from decision to strike-off

1. 1

   Take the shareholders' decision

   In an EOOD the sole owner, in an OOD the general meeting, resolves to terminate the company and open liquidation; the same decision sets the period and appoints the liquidator. In most small companies the liquidator is the manager.
2. 2

   Notify the revenue agency first

   BEFORE the termination is entered in the register, a notification is filed with the NRA and the agency's certificate is obtained — without this document the register will not record the liquidation. The step protects the state's tax claims; issuing can take time, so build the calendar around it.
3. 3

   Register the liquidation and publish the invitation

   The termination decision, the liquidator's appointment and the invitation to creditors are announced in the Commercial Register. From that moment the company's name carries the suffix „in liquidation“, and the six-month period runs from the invitation's publication.
4. 4

   Wind up the business, collect receivables, pay debts

   The liquidator's job is to end ongoing contracts, turn stock and equipment into cash, collect the company's receivables and pay the claims presented. If there are employees, their contracts are terminated according to the rules.
5. 5

   Hand the payroll records to the NSSI

   Before the strike-off, a certificate is obtained confirming that payroll ledgers and personnel files have been handed to the social security institute (NOI) — this protects former employees' insurance history and is a mandatory part of the file.
6. 6

   Final balance sheet and distribution

   After the six months have run and all debts are paid, the closing balance sheet is drawn up; the remaining assets are distributed among the shareholders in proportion to their shares. Clarify the tax effects of the distribution with your accountant.
7. 7

   Request deregistration (заличаване)

   Documenting the completed procedure, the liquidator applies for the company to be struck off the register. When the strike-off is announced, the legal person ceases to exist — the ledger closes on that line.

Expedited liquidation: for whom, and what it saves

The most common real-world case is closing an „empty“ company that has not actually operated for years — and the legislator shortened the procedure precisely for that case. Under the expedited liquidation regime added to the Commerce Act, a company that certifies the statutory conditions — in essence: no recent activity, no staff, no debt risk — waits less: the assets may be distributed once 3 months instead of 6 have passed from the publication of the invitation. The full list of conditions and documents is in the statute; check with your accountant against the text whether your company fits through this door. The period was taken from official sources as of 26 August 2026; verify the current provision on the official page.

The tax and accounting side: the invisible workload

Most of liquidation's paperwork piles up on the tax and accounting desk. Deregistering a VAT-registered company is a separate procedure, and the VAT effect on stock and equipment has to be computed. Separate financial statements and returns are prepared for the liquidation period; payroll filings are closed when the last employee leaves; cash and bank balances are planned to reach zero before the distribution. None of these items is hard on its own, but their order matters — a step taken out of order (say, running to the register without the NRA certificate) gets the file returned and costs weeks. A good accountant is this procedure's driver; that is also why liquidation fees run higher than incorporation fees.

Running it from Türkiye: the power-of-attorney setup

If the owner lives in Türkiye, the liquidation can be run remotely — provided the power of attorney is built correctly. The shareholders' decision and part of the liquidation documents require notarised signatures; a power of attorney issued by a Turkish notary is used in Bulgaria with an apostille and a sworn translation. The practical route: during the visit when you take the closure decision, execute a broad liquidation power of attorney, drafted by your accountant, before a Bulgarian notary — then you will not cross the border for every signature in the months that follow. Closing the bank account can usually be done by proxy too, but banks apply their own internal rules; scheduling that step for a date when you are in Bulgaria in person cuts out the surprises.

What a company in liquidation may and may not do

From the publication of the invitation until strike-off the company lives on, but in a different legal condition: it carries the suffix „in liquidation“ next to its name and its capacity is limited to the purpose of winding up. In practice this means: the company may sell its stock, sue its debtors, dispose of its equipment, deliver work in progress and invoice it — but it takes no new business, makes no new investments, creates no new debts. The liquidator guards this boundary; if it is crossed, the transaction's validity becomes contestable and the responsibility gathers on the liquidator. Telling customers and suppliers early is both courtesy and protection: a supplier who delivers goods to a company in liquidation and leaves payment for after the distribution may meet an unpleasant surprise — and that unpleasantness is charged to your commercial reputation.

Closing a company with employees

If the company has staff, a labour-law layer is added to the liquidation calendar. Closure of the enterprise is among the statutory grounds for the employer to terminate employment contracts; but termination does not happen by itself — notice periods are observed, unused annual leave is paid out, and in the cases the law prescribes, compensation is calculated. Payroll filings must be kept complete until the last employee's departure, because the tidiness of the archive to be handed to the NOI rests precisely on those records. Do not skip the human side either: hiding the closure from staff until the final week destroys trust and rushes the departure paperwork. The employer who speaks early and openly is the one who can work with the same people in the next venture.

ET, branches and freelancers: different shells, different exits

This article's backbone is EOOD/OOD liquidation, but two neighbouring situations are worth knowing. A sole trader (ET) is not a company but a natural person with trader status; it is removed from the register without a classic liquidation, and the process is markedly lighter — yet closing the tax and social security accounts demands the same seriousness, because with an ET the person is directly liable for the commercial debts. A Bulgarian branch of a foreign company is closed by the parent's decision and struck off; a branch has no legal personality of its own, so the classic liquidation construction does not apply one to one. „Closing“ a freelance registration is likewise not a liquidation but a termination of the relevant registrations. Whatever shell you are in, exit through its own door — a file started under the wrong procedure gets sent back to the start.

After the closure: archive and memory

When the strike-off is announced the legal person ends, but the shadow of its obligations lives on for a while. The statutory retention periods for accounting and tax documents apply after deletion too — put the files into an archive, not the bin, and know where they are; a query years later, or a former employee's request for a service record, is answered from that archive. The payroll originals are already with the NOI; your own copies, the bank closure slips, the final balance sheet and the strike-off decision belong together in one „grave file“ of the company. As seasoned accountants put it: the company dies, the binder lives.

Three sample cases

Case 1 — the dormant EOOD run from Istanbul: a company founded years ago for a residence application, with not a single invoice issued. If the declarations were filed on time, this is the textbook case for expedited liquidation: power of attorney + accountant + a three-month wait; one planned trip to Bulgaria by the owner is usually enough. Case 2 — the closing corner shop: an active business with stock, two employees and VAT registration. Here the order is critical: the stock sell-off and staff departures are planned first, the NRA notification goes in early, the VAT deregistration is built together with the stock account — the standard six-month path is realistic. Case 3 — the OOD with a vanished partner: if one shareholder cannot be reached, the decision stage jams; this stops being „a job for the accountant“ and becomes one for a lawyer, and the solutions (share transfer, court) depend on the situation. Whichever case yours resembles, give that snapshot to your adviser in the first meeting.

Frequent mistakes

• •Dropping the filings and 'forgetting' the company: an unclosed company's obligations continue; years of neglect arrive as a printout of fines on the very day you decide to close.
• •Skipping the NRA notification: without the certificate the register will not record the liquidation; a file opened without it is turned back at the door.
• •Treating the six months as a 'formality': distributing before the period ends can trigger the liquidator's personal liability — if a creditor appears, the account is settled with them.
• •Neglecting the payroll archive: without the NOI certificate the strike-off cannot complete; with disorderly personnel files this step can take weeks.
• •Closing the bank account early: refunds and collections during liquidation need an account; close it last, on distribution day.
• •Leaving contracts hanging: auto-renewing contracts — rent, phone, hosting — quietly drain the liquidation cash box if not terminated.

Closure and residence status: the overlooked link

A critical warning for Turkish-citizen owners: if your Bulgarian residence permit was obtained through the company — trade representation, company activity or a similar ground — closing the company removes the ground of your status as well. Make the status plan before the liquidation starts: can the residence be moved to another ground (family, retirement, another company, long-term status), does the renewal date collide with the liquidation calendar, how will the strike-off appear in the renewal file? The answers are individual and belong to migration law — a matter for a residence adviser, not the company's accountant. The price of the wrong order is heavy: the company closes, the residence cannot be renewed, and an order built over years breaks over one signature. The right order is simple: status first, liquidation second.

The checklist in your pocket

• •Before the decision: is the filing status of the last three years pulled? Is a residence permit, licence or vehicle tied to the company?
• •Start: is the NRA notification filed and the certificate received? Are the liquidator and the period written into the decision?
• •Announcement: are „in liquidation“ and the invitation to creditors visible in the register? On which day did the six-month (or three-month) counter start?
• •Process: are the contracts terminated? Are the staff departures and the NOI archive done? Is the VAT deregistration planned?
• •Finale: were the final balance sheet, the distribution, the bank closure and the strike-off application done in order?
• •Afterwards: is the archive binder assembled and are the retention periods noted?

The psychology of closing: a full stop in the right place

The last word is strategic, not technical. Closing a company is not an admission of failure but balance-sheet discipline: keeping a non-working structure on the register costs money, attention and risk every year. The criterion is simple — if there is no real chance the company will be used for genuine work in the next two years, liquidation should start today; the procedure takes months anyway, and every year of „maybe later“ pushes the closing day a year further out. Founding a new company in Bulgaria is fast and cheap; a cleanly closed past is not an obstacle but a reference for the next venture. Close the ledger properly so you can open the next one with an easy heart.

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