Bulgaria is the newest EU member. It’s located at the boarder of Europe and Asia between the Black and Adriatic Seas. It has a population of 7.2 million mainly concentrated in the administrative centers of its 28 provinces. Most commercial and cultural activities are centered in the capital which is the largest city named Sofia. The largest economic sectors are heavy industry, power engineering, and agriculture.
Bulgarian legislation is designed to attract foreign investors. The income tax regime is among the lowest in Europe holding a 10% flat tax on all sources of income and favorable tax treaties with its European partners and is completely synchronized with EU legislation. Bulgaria also has one of the lowest labor costs and services in the EU but still maintains a well-qualified workforce.
Bulgaria’s offshore company’s law was amended in the previous National Assembly. It had restrictions on company ownership in key areas of the Bulgarian economy such as banking, pensions and media. The European Commission prompted the recommendations because they were overly restrictive. The amendments have opened up new opportunities.
The new Act introduces a much more detailed set of requirements for registration of offshore companies and their beneficial owners. Failure to register may result in a new sanction amounting from EUR 5,000 to EUR 25,000. It takes only several days to register a new company in Bulgaria. International Value Added Tax (VAT) registration takes 10 days. The minimal start-up capital has been reduced to only €1 ($1.25 USD). Bulgaria does have Double Taxation Treaties with 58 countries world-wide.
There has to be at least one director to represent the company in front of all authorities; there is no requirement for the director/s to be a resident of Bulgaria. An audit is only required if the company exceeds certain limits for turnover, assets or employees. Monthly VAT returns must be filed if the turnover exceeds €25,000 ($30,750 USD). The company should have a bank account and local address for efficient communication with the authorities