Company types in Bulgaria: EOOD, OOD, AD and ET

Companies and taxes · Last reviewed: 2026-10-10

Why the decision is usually EOOD versus OOD

An EOOD is a limited liability company with a single owner; an OOD is the same structure with two or more partners. Liability is in principle limited to the capital contributed, so a partner's home or personal account is not security for company debts. If you start alone and later take on a partner, the company becomes an OOD — you do not incorporate again, the change is simply registered.

When AD and ET actually come into play

An AD is a joint-stock company whose capital is divided into shares. It is considered where outside investors are expected, where share transfers should be easy, or where formal management and supervisory bodies are wanted; in exchange, its minimum capital is markedly higher than for limited liability companies and governing bodies are compulsory. An ET (sole trader) creates no separate legal person at all: the business and the individual are one, so you are liable for business debts with everything you own. It suits small, low-risk activity — where risk exists, this difference decides the matter.

A branch or representative office is not a company

• •Branch (клон): an extension of a foreign parent company, entered in the trade register but without its own legal personality — the parent answers for the debts.
• •Trade representative office: intended for promotion, market research and liaison work, and it may not carry out commercial activity for profit.
• •Neither is the right vehicle for regular trading — for that you incorporate a company of your own.

Four questions to settle first

1. 1

   Does the activity carry risk

   If there is any prospect of harming a client, taking on debt or facing damages, a limited liability form is the first option to consider.
2. 2

   Will there be a partner

   If a partner is likely soon, incorporating directly as an OOD saves a later registration change.
3. 3

   How will profit reach you

   In a limited liability company profit is taxed at company level first and again as withholding tax when distributed as dividend. A sole trader has no such two-tier structure.
4. 4

   Who carries the accounting load

   Every form has annual filing and financial statement duties. In Bulgaria this work is usually handed to a contracted accountant.

The business forms in numbers

The Ministry of Economy's small-business handbook (last updated 18 June 2025) names ET, EOOD/OOD and EAD/AD as the forms used most often in Bulgaria. The Commerce Act also recognises the general partnership (SD), the limited partnership (KD), the partnership limited by shares (KDA) and the European company (SE), which is rarely used in practice. Since 2023 there is also a variable capital company: a variation of the OOD with no fixed minimum capital, in which partners can join and leave without amending the articles; it is registered under the OOD/EOOD procedure and its name must show that its capital is variable.

The handbook lists the main advantages of the ET as having no capital requirement and a relatively simple procedure for ending it, and the main drawbacks of the EOOD/OOD as a registration fee significantly higher than for an ET and a long, complicated liquidation.

The tax calendar: how the form changes it

According to the NRA's pages, corporate tax is 10% (Art. 20 of the Corporate Income Tax Act); the annual return is filed between 1 March and 30 June of the following year, and the tax is paid by 30 June. A sole trader (ET) is not a separate legal entity: the annual tax on the profit is 15%, and the filing window and payment date are the same, 1 March to 30 June. So the rates and calendar look alike, but the law differs: a company falls under the Corporate Income Tax Act, while an ET owner falls under the annual tax of Art. 28 of the Personal Income Tax Act.

Branch and representative office: the BULSTAT entry

The Registry Agency's BULSTAT page says that branches of foreign persons who are not traders, and foreign trade representative offices under Art. 24 of the Investment Promotion Act, are entered in BULSTAT. A representative office needs a registration document from the Bulgarian Chamber of Commerce and Industry, and a foreign legal entity that carries on activity in the country needs a document showing that activity plus a legalised document showing how it was created and who represents it.

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