Bulgaria company formation (2026): 10% tax, 5% dividends and the EOOD

Founders & Company Structures
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To open a company in Bulgaria, most founders register a single-member limited liability company (EOOD) with the Registry Agency’s Commercial Register. The minimum capital is now €1, because Bulgaria adopted the euro on 1 January 2026, and the electronic state fee is about €28. Profits are taxed at a flat 10%, dividends paid to individuals carry a 5% final withholding tax, and personal income is taxed at a flat 10%.

Last checked: October 2026

In short:

  • An EOOD needs one owner, one manager who is an individual, and at least €1 of capital; foreigners can own and manage it.
  • Corporate tax is 10% and dividends to individuals are taxed at 5%, so a profit taken out as a dividend bears about 14.5% in total.
  • A Bulgarian company only makes sense with real Bulgarian substance or a founder who actually lives there; your home country may otherwise tax the profits anyway.

Bulgaria’s tax rates at a glance

PwC’s Worldwide Tax Summaries for Bulgaria were last reviewed on 2 August 2026. They show these headline rates:

Tax Rate in 2026 Notes
Corporate income tax 10% Flat rate on company profits
Dividend tax, individuals 5% Final withholding tax at source, for residents and non-residents
Dividend tax, EU/EEA companies 0% No Bulgarian withholding tax, except on hidden profit distributions
Dividend tax, other non-resident companies 5% Can be reduced by a tax treaty
Personal income tax 10% Flat rate on most income
VAT, standard rate 20% 9% reduced rate for some goods and services
Social security and health insurance, employees 32.7% to 33.4% in total Employer 18.92% to 19.62%, employee 13.78%

In December 2025 the government said it would submit a revised 2026 budget after mass protests against its first draft (bne IntelliNews). Tax proposals in Bulgaria can move quickly. PwC’s August 2026 summary still shows the 10% and 5% rates, and we found no source showing a change in force. Check again before you plan a large distribution.

A simple example. A company earns €100,000 of profit. It pays €10,000 corporate tax. If it pays the remaining €90,000 to you as a dividend, 5% withholding takes €4,500. You keep €85,500, so the combined rate is 14.5%. Any social security you owe as a manager comes on top (see below).

EOOD or OOD

Bulgaria’s limited liability company comes in two forms. The government’s Point of Single Contact (psc.egov.bg) describes them like this:

EOOD OOD
Owners One person, individual or company Two or more persons
Foreign owners Allowed Allowed
Manager Must be an individual; can be the owner or a third party; foreigners allowed Same
Founding document Founding act Company contract (articles)
Minimum capital €1 €1

The EOOD is the default choice for a solo founder. Choose an OOD only if you have co-founders who will hold shares directly.

Minimum capital after the euro

Bulgaria joined the euro area on 1 January 2026. The conversion rate is fixed at 1.95583 leva to €1 (European Central Bank).

The government portal still shows the old rules in leva: a minimum of BGN 2 in total, with each share at least BGN 1. Corporate services firm Mercator says the statutory minimum for an OOD or EOOD is now €1, and €25,000 for a joint-stock company. Existing companies have until 31 December 2026 to update their articles to show their capital in euro. The Registry Agency converts the registered figure automatically, but the company is still responsible for amending its documents.

The government portal also notes that non-cash contributions must be valued by three independent experts. Most founders contribute cash.

How registration works

Registration is handled by the Registry Agency (Агенция по вписванията), which keeps the Commercial Register. You can file on paper or electronically with a qualified electronic signature. Applications must be in Bulgarian, and foreign documents need certified Bulgarian translations (psc.egov.bg).

A typical EOOD process looks like this:

  1. Check and reserve the name. You can check availability in the Commercial Register.
  2. Prepare the founding act. It is signed by the sole owner.
  3. Manager’s consent. The manager signs a declaration of consent with a specimen signature, which is normally notarised.
  4. Pay in the capital. You open a capital account with a Bulgarian bank and get a certificate of deposit.
  5. File the application. You submit the registration application with the founding documents and declarations, and pay the state fee.
  6. Register for tax and social security. The company is then registered with the National Revenue Agency for tax purposes; the manager may also need to be registered for social security.

State fees. The government portal lists the fees in leva. The table shows them with the euro equivalent at the fixed rate:

Fee Paper filing Electronic filing
Registration of a limited liability company BGN 110 (€56.24) BGN 55 (€28.12)
Retention (reservation) of the company name BGN 40 (€20.45) BGN 20 (€10.23)

Bulgarian accounting firm Innovires gives the same €28.12 and €56.24 figures for 2026. It says an electronic filing with complete documents is usually registered in 1 to 3 business days, and remote registration from abroad takes about 7 to 14 business days. These are the firm’s estimates, not official deadlines.

Government fees are small. Professional fees for a lawyer or accountant, translations, notary costs, a registered address and monthly bookkeeping will cost far more. Get written quotes.

Social security for managers

Dividends are not subject to Bulgarian social security. What you pay yourself as a manager is.

According to Innovires, a sole owner who also manages an EOOD is usually treated as a self-insured person. The owner is often insured through a management contract and must register with the National Revenue Agency. The firm lists the 2026 contribution rates as 14.8% pension, 5% supplementary pension (for people born after 1959) and 8% health insurance, a total of 27.8%. Sickness and maternity cover at 3.5% is optional.

PwC gives the monthly insurable income limits for the self-employed in 2026:

Period Minimum insurable income Maximum insurable income
1 January to 31 July 2026 €550.66 €2,111.64
From 1 August 2026 €620.20 €2,300

This is why many owner-managers pay contributions on a small salary and take most of their profit as dividends at 5%. If you live and work in another EU country, the EU social security coordination rules may make that country, not Bulgaria, responsible for your contributions. Take advice on which country has the right before you register.

VAT registration

PwC says the VAT registration threshold from 1 January 2026 is €51,130 of taxable turnover in Bulgaria. The period used for the test changed from a rolling 12 months to the calendar year. The standard VAT rate is 20%.

Many service businesses selling to EU companies will deal with the reverse charge and may need a VAT number earlier. Ask your accountant how this applies to your customers.

Tax residency: you and the company

The company. PwC says a company is resident in Bulgaria for tax purposes if it is incorporated there. That is the only domestic test. But a tax treaty can override it. If another country treats the company as resident because it is effectively managed there, the treaty tie-breaker usually looks at where key management decisions are actually made.

You. PwC says an individual is Bulgarian tax resident if they spend more than 183 days in Bulgaria in any 12-month period, or if their centre of vital interests is in Bulgaria. Residents are taxed on worldwide income. Non-residents are taxed only on Bulgarian-source income.

Spending fewer than 183 days in Bulgaria does not make you tax-free anywhere. Your home country may still treat you as resident. Our guide to the 183-day myth explains why.

Banking

You need a Bulgarian bank account before registration, because the capital has to be paid into it. Bulgarian banks are now part of the euro area and have been under European Central Bank supervision since October 2020 (ECB).

Expect enhanced anti-money-laundering checks if you are a non-resident. Banks will usually want to see:

  • passport and proof of address;
  • a description of the business, customers and expected payments;
  • source-of-funds and source-of-wealth evidence;
  • the beneficial ownership of the company.

Requirements vary by bank. Some want the owner and manager to attend in person. Ask the bank before you book a flight.

Who Bulgaria suits

  • Founders who will live in Bulgaria. As a resident you get the 10% company rate, 5% dividends and 10% personal tax on salary, inside the EU and now inside the euro area.
  • EU businesses with real operations there. For example, a team in Sofia or Plovdiv, or customers in the region.
  • Holding structures. Dividends paid to EU/EEA companies carry no Bulgarian withholding tax, according to PwC.

Pitfalls

Substance. A Bulgarian EOOD with a virtual office and a founder who never visits is a weak structure. Banks, payment providers and foreign tax authorities will all ask what actually happens in Bulgaria.

Management and control. If you run the company from Lisbon, London or Bangkok, that country may say the company is resident there or has a permanent establishment there. The 10% rate then stops being the only tax you pay.

Your home country’s CFC rules. Many countries tax residents on the profits of low-taxed foreign companies they control, whether or not the profits are paid out. If you stay resident in a high-tax country, a Bulgarian company may save nothing. Check before you incorporate.

Social security mistakes. Taking no salary as a working manager, or paying contributions in the wrong country, can lead to back-payments and penalties.

The euro changeover. Old guides quote fees and capital in leva. Use euro figures and check that your documents are updated by the end of 2026.

Related guides: Where to incorporate as a digital nomad: US LLC, UK, Estonia, UAE · Holding company for founders (2026): how it works and where to set one up · Cyprus company formation (2026): the 15% tax, non-dom and setup steps · Tax residency explained: why the 183-day rule is a myth for most countries · Tax-free countries (2026): no income tax countries you can actually live in

Quick answers

Q: How much does it cost to register a company in Bulgaria?
The Registry Agency’s fee for registering a limited liability company is BGN 55 (€28.12) online or BGN 110 (€56.24) on paper, plus a small name retention fee. Minimum capital is €1. Lawyer, notary, translation, address and accounting costs are extra and usually far higher than the state fees.

Q: What is the dividend tax in Bulgaria in 2026?
Dividends paid to individuals, resident or not, are taxed at a 5% final withholding tax, according to PwC’s August 2026 summary. Dividends paid to companies resident in the EU or EEA are generally exempt. Combined with 10% corporate tax, profit paid out as a dividend bears about 14.5% in total.

Q: Can a foreigner open an EOOD in Bulgaria?
Yes. Foreign individuals and companies can own an EOOD, and a foreign individual can be its manager. The manager must be a person, not a company. You need certified Bulgarian translations of foreign documents and a Bulgarian bank account for the capital. Banks apply extra due diligence to non-residents.

Sources

This is general information from the Nomad Forums team, not legal, tax or financial advice. Rules change; check the official source or a qualified adviser before acting.

Over to you: If you have registered an EOOD since the euro changeover, how long did it take and which bank opened your capital account? And if you live outside Bulgaria, how has your home country treated the company?

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