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Bulgaria's tax system: flat rates and who collects

What distinguishes the Bulgarian tax system is that it applies a flat rate rather than a progressive scale. Personal income and company profit are taxed at the same fixed level, and the institution that runs the system is the National Revenue Agency (НАП / NRA).

Companies and taxes · Last reviewed: 2026-08-16

The headline rates, and why there are so few numbers

Settled rates; how the base is computed is a separate matter
TaxRate
Personal income tax10%
Corporate income tax10%
Dividend withholding tax5%
VAT — standard rate20%
VAT — reduced rate9%

The simplicity of the system ends at the rates. How the taxable base is formed, which expenses are recognised and which income is exempt are governed by detailed rules. That is why the sentence «I will pay 10%» is misleading on its own: what matters is what those 10% are charged on.

The two layers between profit and dividend

A company's profit is first subject to corporate income tax. When the remainder is distributed to an owner as a dividend, withholding tax arises on top. Leaving money in the company and paying it out to yourself therefore have different tax consequences. Paying yourself a manager's remuneration is a third route, where social security contributions join the income tax.

Contribution rates are not stated here

Social security and health insurance contribution rates, and the minimum and maximum insurable income, are set annually by the budget act. This page deliberately gives no figures — rely on the NRA's official pages and your accountant.

Who counts as a Bulgarian taxpayer

Tax residence is determined not by citizenship but by statutory criteria: where the permanent address is, how long the person stays in the country during the year, and where the centre of vital interests lies. A resident is answerable in Bulgaria for worldwide income; a non-resident only for Bulgarian-source income. For someone living between two countries, this is the first question that decides which state the tax belongs to.

Double taxation treaties

  • Bulgaria has concluded treaties with a large number of countries, Türkiye among them; a treaty takes precedence over domestic law.
  • Treaty relief is not applied automatically — a separate procedure runs before the NRA, usually requiring a residence certificate issued by the other state.
  • Information exchange mechanisms also operate within the EU, so income undeclared in one country does not stay invisible in the other.
  • Which state may tax depends on the type of income: salary, dividends, rent and professional income are governed by separate articles.

Working with the NRA in practice

The NRA is the centre of filing and collection: the annual return, VAT returns and contribution declarations all go there. Electronic services are accessed with a qualified electronic signature or with a personal identification code issued by the agency. For companies, keeping the filing calendar is usually the contracted accountant's job, but legal responsibility stays with the taxpayer.

This is not tax advice

The rates above are framework information; the base, exemptions and reliefs that apply to you depend on personal circumstances. Confirm with a tax adviser or certified accountant before deciding anything.

This is not legal or financial advice

This page explains the process in general terms and points to the official sources of the competent authorities. For decisions specific to your own situation, consult a lawyer, an accountant or the relevant institution. Rules and amounts change over time.

Frequently asked questions

Is there really only one personal income tax rate in Bulgaria?

For personal income, yes — the flat rate is 10%. But statutory reliefs and special regimes for certain income types affect how the base is formed, so the effective burden is not always exactly 10%.

Will I pay again in Bulgaria on income already taxed abroad?

Double taxation treaties exist precisely to prevent that. Relief or credit is not automatic, however: the procedure before the NRA has to be followed and the supporting documents produced.

What is the better way to move company profit to myself?

Dividends, remuneration and retaining funds in the company have different tax and contribution outcomes; which suits you depends on income level and insurance status. It is a decision to take with an accountant, using real figures.

Sources

The information on this page is based on the official sources listed below. Legislation changes — open the links and verify the current position.

  1. Национална агенция за приходите (НАП / NRA) — https://nra.bg/ · 2026-08-16
  2. ЗДДФЛ и ЗКПО — официални текстове (lex.bg) — https://lex.bg/ · 2026-08-16
  3. European Commission — Taxation and Customs Union — https://taxation-customs.ec.europa.eu/ · 2026-08-16
  4. Your Europe — Citizens: taxes and double taxation — https://europa.eu/youreurope/citizens/ · 2026-08-16

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Bulgaria's tax system: flat rates and who collects | Bulgaristan.bg