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Property in Bulgaria starts “five years of growth”

The real estate market in Bulgaria there are five-year plans: one grows, another falls, and then rising again. About when the long-awaited “Wellness” five-year plan and what it will mean for the buyer – in the material .

The price for six months remained stable

Bulgaria has entered a new five-year plan for growth which experts were waiting for all last year. Now this country does not belong to those who speak about that real estate there is getting cheaper every day: leave it Greece, Cyprus and Croatia.

According to Eurostat, in the fourth quarter of 2013, housing in Bulgaria have risen by 0.1% in the first quarter of 2014 and by another 1%. Then, in the beginning of 2014, Bulgaria for the first time recorded an increase in prices in annual terms – by 0.7%.

d646bd3255809f64df93258888522a51 - Property in Bulgaria starts "five years of growth"

National statistical Institute of Bulgaria published encouraging data on the second quarter: square meter on the secondary market in Bulgaria increased by 3 levs and cost 869,29 Lev, which in terms of the European currency is equal to €444,5. Slowly, but the third consecutive quarter, average prices are rising. Considering the wide time span, now the prices are at the level of 2006, while the Golden time for sellers has fallen to mid-2008, when “square” was worth €725.

d4bb640c0cafeca4fc16d2fac0537299 - Property in Bulgaria starts "five years of growth"
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In the second quarter to the first a bit more expensive Burgas (€578), Plovdiv (€489), Sofia (€754). Slightly decreased prices in Varna (€699). Three expensive cities is as follows: Sofia, Varna, Burgas. One-bedroom apartments in Sofia are sold on average €50 thousand, three – room – €70 thousand three cheapest cities includes Kyustendil, which does not save even the proximity to the capital, border with Romania, Vidin and Gabrovo in Central Bulgaria where the cost of the “square” just over €250.

Of course, the new projects being built of the coast, these rates do not apply. The primary market offers higher quality and therefore more expensive apartments. Finished apartment with views of the sea or just near the beach cost from €35-50 million, that is about €1 thousand for sq. m (for example, in Varna or Primorsko). In addition, the price depends on the prestige of the resort: expensive to include Golden Sands, Pomorie, Varna, Nessebar, Tsarevo, cheaper – Sozopol and Sunny beach.

The price increase does not mean that the era of cheap accommodation in Bulgaria ends. The market is recovering is barely noticeable, so the time to buy cheap houses and apartments in Bulgaria the buyer has. The real estate prices Bulgaria in Europe can be compared only to that of Turkey, where on the coast you can buy a home of comparable quality at the same price. And the prices for goods and services, Bulgaria has no competitors. Electricity is like in Russia – 9 cents for 1 kWh, alcohol is the cheapest in Europe, food and drink – for the second cheapest after Poland. Moreover, over the past year, consumer prices decrease: deflation of almost 2%.

c3d54b7434a80bfcab411c43569c38f1 - Property in Bulgaria starts "five years of growth"

Sales grow Bulgarians, and Russians – fall

Information about real estate sales in Bulgaria are not as affordable as the average price, and you have to rely on the testimony of real estate agents. Most of them say the revitalization of the market in the second half of 2013, according to rough estimates sales have increased by 15-20%. The largest number of transactions accounted for the segment of affordable housing and real estate economy class cost up to 100 thousand BGN, that is, in the range of 50 thousand euros. Bulgarians often buy two-bedroom apartments at an average price of €39 thousand

The Russians are the main buyers of property in Bulgaria and they rely on the realtors who dreams about stabilization of the Russian economy and the speedy resolution of foreign policy issues. In the first quarter, “Yandex” property in Bulgaria was searched for 20% more than a year ago, but many agents say the decline in sales. Teodora Dimitrova, Executive Director of “EPA Bulgaria” notes that in the first half of the year Russians bought in Varna and Burgas is 35% less than in the same period last year.

——————-
“The investments of Russians in real estate in Bulgaria exceeded the budget of this country”
——————-

Perhaps there is reason to associate the drop in sales with a certain saturation of the market. The number of Russian-speaking owners in Bulgaria of seven million is committed to half a million. The Russian Consul in Varna Yurii Solovyov voiced data about 500 thousand “Russian” objects in your consular district (Varna, Dobrich, Shumen, Burgas, Sliven, Yambol regions). In this case, living only 6 thousand people, and another 300 thousand visited Bulgaria regularly. Some publications claim that the Russians in Bulgaria and is owned by 700 thousand houses and flats, the total value of which exceeds the country’s budget and is equal to €18 billion.

721e41b5d4bf617fadb7eb550605917c - Property in Bulgaria starts "five years of growth"

According to Pauline Stoykova, Executive Director of Bulgarian Properties, buyers from Russia prefer the resorts to the South of Bourgas, such as Sozopol or Burgas. However, Pomorie, Nessebar and Sunny beach, located to the North of the regional capital, also do not lose their popularity. Average transaction amount the Russians have 32 thousand a Great option for those seeking a cheap holiday by the sea.

Text: Kirill Ozerov,

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Bulgaria: resorts for every taste

Portal European property in anticipation of the summer season is considered the main resorts most dear to Russian foreign countries – Bulgaria.

Bulgarians – people are open, hospitable and extremely talkative. For Russian tourists this is a rather positive fact, because of the language barrier in this country are almost there. All because first, Russian is widely spoken in this country, and secondly, the Bulgarian language is similar to Russian.

People unfamiliar with Bulgarian culture, at first may surprise national custom of the Bulgarians: the negative pump head if necessary to answer “Yes.” Sense of humor is another attractive feature of the Bulgarian national character. In Bulgaria there is even a capital of humor – Gabrovo, and the inhabitants of this city, Gabrovo, characters jokes, known far outside the country.

Occupy a special place in Bulgaria, numerous folk festivals. The most popular and loved New year, Carnival, Trifonov day (February 14) that is associated with the ritual cutting of the vine and of electing the “king of the vineyards”. On 1 March Bulgarians celebrate the arrival of spring, in whose honor I give all relatives and friends martenitsa – a delicate trinkets in the form of tassels of red and white threads.

Sunny beach

The largest sea resort of Bulgaria occupies the space along the long Golden sandy beach 8 km. there are more than 100 hotels and numerous restaurants, bars and night clubs. Hotels located near the sea and surrounded by greenery.

The shore here is flat, enclosed by high dunes, and the seaside is one of the cleanest on the Black sea. Bulgarians adhere to high environmental standards, no wonder Sunny beach awarded the Blue flag (certificate of quality beaches, established by the European Commission on environment and districts annually awarded on the basis of the results of testing the purity of water and sand).

Apartment is 30 square meters in this resort region can be purchased for around €10 000. Studio with area of 44 sq. m. will cost you €15 000. Cheap apartments in 400 meters from the sea will cost about €20 000.

Golden Sands

Golden Sands resort is located 18 km North from Varna, famous for its sandy beaches, amazing yellow, stretching all along the coast. The most famous and popular resort in Bulgaria.

Golden Sands is famous for its ecological cleanliness – the beaches here are quite narrow, and immediately behind them begins the forested hills. Dense forests and Golden sand – a wonderful combination that creates a unique landscape. The sea is quite shallow and the bottom is very clean. The average water temperature in summer is +24°C.

To the sea on the Golden Sands you can add a treatment on mineral sulfur springs. Throughout the year working balneological center. In addition to mineral water for the treatment are sulphur mud. The season lasts from may to October, the weather is usually Sunny and dry.

Studio apartment 25 sq. m. in Golden Sands will cost approximately €30 000. The prices are a little higher than in Sunny beach. Studio 50 sq. m. in Varna, near Golden Sands, will cost about €45 000.

Pomorie

20 km North of Bourgas is the town of Pomorie, which is located on the Peninsula in the center of the large Burgas Bay. Pomorie is famous for its salt lakes with medicinal mud, which treat disorders of the musculoskeletal system, gynecological diseases, disorders of male reproductive activities, neurological and skin diseases.

Since time immemorial, in this region salt was obtained. In the exposition of the unique Museum of salt are ancient structures and tools for salt production, photos and videos. Artificial bays with an area of 20 hectares you can observe ancient ways of evaporation of salt.

In recent decades, the city became an important Spa and Thalasso therapy centre. Among other things, the famous Pomorie brandies and wines. To appreciate all this, you can buy a small apartment of 35 sq. m for only €20 000. Apartment of 30 sq. m. just 70 meters from the sea cost €26 000.

Pamporovo

Pamporovo – a famous ski resort with excellent, Sunny weather, which pleases tourists and gives them a good tan. In addition to ski slopes here is still and hot springs, around which there are several Spa centers.

In Pamporovo there are trails for skiers of different levels. In the warm season due to the ideal climate here you can enjoy Cycling and Hiking. Many of the hotel infrastructure, make Pamporovo a great place to stay for a whole year. You can of course purchase and private housing that is inexpensive. For example, the apartment is 31 sq. m. has a price tag of €21 000. Apartment 42 sqm can be purchased for just €28 000.

Text: Ivan Ulitin,

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Sofia housing during the construction phase is more expensive apartments in ready homes

For the period from June to September 2016, average cost of facilities that were commissioned in Sofia earlier than 2015, amounted to €870 per sqm Property under construction in the Bulgarian capital is valued higher – at €1019 per sq. m. This information lead investor portals.bg and novinvite.com referring to the study of the construction and investment company BLD.

Now on the market there are two types of buyers. For the first group who buy housing for the first time, two important criteria – price and quality. They act strictly within their budget, and they come from such common parameters, such as the development of infrastructure, availability of schools, location of district, etc.

Customers from the second group (those who want to improve their living conditions) more meticulous – they draw attention to the environmental situation in the area, even neighbors. This category of buyers has determines the trend of growth of cost of square meter in buildings under construction.

According to the Executive Director of the BLD, with the beginning of this year in Bulgaria is building more than 13,000 new apartments. They are created on the basis of customers ‘ requirements. Therefore, the price of housing under construction are above average.

One of the most important factors affecting the price of the apartment is a garage. The cost of Parking garages in the best new properties varies between €10,000 and €14 000.

Materials novinite.com

Photos Depositphotos.com

 

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In the Bulgarian town of Nessebar has increased the real estate tax

The city Council of Nessebar made a final decision to increase the real estate tax from 1.2% to 1.8%.

Recall, back in 2015 in the settlements of the first category of the whole Burgas region, the tax rate was raised. This change did not affect only of Nessebar, where with the 2011 tax levy for property owners is kept at 1.2%.

At the end of summer 2016, the mayor of Nessebar has proposed to the City Council to increase the tax up to 2.2% – the funds will be spent on the repair of sports and playgrounds, the construction of Cycling roads, repair the post buildings, etc. the Board of Deputies, as expected, raised the tax only to 1.8%.

Materials bourgas.ru

Photos Depositphotos.com

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In Bulgaria mortgage rates fall below 4%

In the fall of 2016, many Bulgarian banks will offer potential customers loans at a rate of around 3,95%. This information leads the management of the Credit center of Bulgaria. So low interest rates will persist only within 12-24 months of the loan term. In the remaining period of the crediting rate will rise.

Recently in Bulgaria is slowly but surely increasing the size of wages and falling interest rates, so Bulgarians are more active in taking loans from local banks to purchase their own homes.

Not long ago, experts of the European Commission conducted a stress test of the Bulgarian banking system. The audit showed that local banks I “feel” good and help is not needed.

Materials bourgas.ru

Photos Depositphotos.com

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In Bulgaria, the average mortgage rate in June, below 5%

By the end of June 2016 mortgage in Bulgaria continues to decrease. The average rate of the Bulgarian National Bank amounted to 4,97% (in local currency).

With regard to mortgage loans in foreign currency, they gradually lose their appeal. Per month rate rose from 5.61% to 5.75%. A year ago, in June 2015 the mortgage in the currency gave at the rate of 6.14%.

The interest on the mortgage in BGN has been declining during the year. In June 2015, borrowers took out loans of 5.77% per annum, and in may 2016 under of 5.03%.

According to the expert Kostadin Jig, over time, credit conditions will become even softer, cheaper mortgage. The population will start more actively to buy real estate with the assistance of mortgage loans.

Materials novinite.ru

Photos Depositphotos.com

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By the end of 2016, Bulgarian property will rise in price by 12%

Bulgarian mass media “Standart” reports that for the period from January to June, housing prices rose by 7%. It is expected that by the end of this year the price growth will reach 12%

One of the reasons for the increase in the average cost per square meter in Bulgaria – low interest rates on mortgages. Central State Bank reported earlier that the amount of mortgage loans that were issued during the first six months of 2016, is €4.5 million Is the highest result for the last year and a half.

Property buyers often make repairs in the apartments and thus increase their value. The final price at times reach €2,000 per sq. m. And if earlier the most popular facilities were a small Studio, it is now well sold in more expensive options – comes with multiple bedrooms, a large dressing room and spacious bathroom.

The average price of housing in the capital of Bulgaria the city of Sofia by the beginning of July – €772 per sq m. In Varna apartments are sold on average at €726 per sq. m. Property in Burgas and Plovdiv is much cheaper. The average cost per square meter in these cities barely reaches €550.

Materials bourgas.ru

Photos Shutterstock.com

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Bulgaria: prices for residential property on the coast will soon rise to 10%

The experts from Bulgarian Properties believe that the rumors about the collapse of prices on the resort property after a decline in demand from the Russians is clearly exaggerated. Although in the coming years in Northern Bulgaria are unlikely to be major new investment.

The buyers from Russia came to the inhabitants of Bulgaria. Furthermore, it is now quite active citizens of other countries. For example, in Golden Sands active buyers from Israel, Lebanon, the UK.

According to Bulgarian Properties, resort real estate in Varna by the end of this year will rise by 10%.

While the share of investment purchases is only 4%, the lion’s share of customers buy housing, either directly for themselves or for their children (80% and 12%, respectively). The most frequent request – Studio apartment (40%). Spacious apartments or detached houses interested in 15% of potential buyers.

Materials novinite.ru

Photos Flickr.com

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Property in Sofia continues to grow in price

The representatives of “real estate imoti” reported that from January 2016 price per square meter in the Bulgarian capital has also increased, and during the whole 2015. In addition, since last year for a major Bulgarian cities are characterized by an increase in the number of transactions with real estate.

By the end of 2015, sales in Sofia increased by 17%, 15% in Blagoevgrad. In comparison with 2013, Sofia estate has risen by 25%.

This trend only applies to large cities. On the coast of the square footage, on the contrary, become cheaper, and the number of transactions decreases. For example, in Pomorie the number of sales fell by 20% in Reserve — 19%.

Experts from the “real estate imoti” I believe that by the end of this year the growth of prices for real estate in Bulgaria will slow down and the market will enter a phase of equilibrium.

Materials bourgas.ru and rus.bg

Photos flickr.com

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Requirements on the size of investment for obtaining a residence permit in Bulgaria has decreased in 6 times

Foreign investment in Bulgaria is decreasing. In this regard, the Parliament considered a draft law, according to which is reduced the lower the investment threshold required to obtain a residence permit in Bulgaria. Yet foreigners applying for residence in Bulgaria, you need to acquire real estate in the amount of €306,000. However may soon that amount will reduce by 6 times – up to €51,000.

The portal “Russian Bulgaria” reports that in support of this legislative initiative is already supported by the representatives of the migration Directorate Moi. Indeed, the owners of Bulgarian square meters spend a lot of time in the country, then spend their savings and, therefore, extremely useful for the economy.

The bill contains another notable norm – a foreigner who is granted permanent residence in Bulgaria may become a full citizen of the country, investing around €510,000 in one of the Bulgarian companies, or increasing its investments to €1 million.

Against the bill voted by the deputies of the Bulgarian socialist party, who believe that such changes can lead to an influx of migrants from “risky” States.

Materials realty.newsru.com

Photos Depositphotos.com

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In Bulgaria are increasingly investing in real estate

in Bulgaria last year the number of citizens declared the income from housing delivery in rent, increased by 6 000 people. Total for the year of 2015 was declared about 213 million lion received by landlords.

Experts believe that the Bulgarians began to more actively buy property and rent it out because in local banks interest rates on deposits fell by almost 5%.

Currently, about 20% of transactions with real estate in Bulgaria are made in order to investment capital.

Some investors invested in expensive housing oriented to wealthy tenants. Others prefer apartment with two rooms cost from €50 to €70 thousand. During the year, such facilities bring to €3 500. The percentage of banks by the same amount will amount to €563 per year.

According to the materials of rus.bg

Photos Depositphotos.com

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The real estate market in Bulgaria adapts to buyers from other countries

With the approach of summer, the demand for the Bulgarian resort real estate. However, the market has significantly changed the spread of power – the Russian and British buyers withdrew to the sidelines.

More recently, the real estate market in Bulgaria has been trapped under a rather narrow category of people. Basically, on the Black sea resorts was advertised for the Russians and UK citizens. In April 2016, Bulgarian Properties reported an increase in demand from people in other 15 countries. Among them were citizens of Canada, New Zealand, Serbia, Italy and Spain.

Interestingly, increased number of buyers from Bulgaria itself. Basically, they buy houses in the ski resorts or on the coast. In the beginning of 2016 were sold especially a lot of properties in Bansko, also for example in Borovets 90% of buyers were Bulgarians.

Buyers from Russia was less than in previous years. Now the Russians, in response to the crisis, interest in Bulgaria only the most expensive houses and apartments.

In the first quarter of this year, the square meter in Bansko can be purchased for €358, Borovets – €585, and in Sunny beach for €520.

Materials inostrannik.ru

Photos Depoditphotos.com

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In Sofia there is a significant increase in sales in new

In the first quarter of 2016 in the capital of Bulgaria Sofia, there was a significant increase in sales in new buildings. Most buyers were interested in properties worth up to €50 000. However, such options were not so many, especially in the most popular area of Sofia.

The average price for housing in Sofia have exceeded €800 per square meter. The price increase for the year was 8.4% and 2.5% compared to the previous quarter. As regards new buildings, the apartments are usually sold at a price of €950 per square meter.

It proves once again that today customers are willing to pay more for a new home. The average price of apartments in the secondary housing sector amounted to €79 800, and in the sector of new buildings is €90 000.

An important trend of the period — increase shares of the acquired two-bedroom apartments. Now apartments with two and three bedroom apartments in Sofia are sold with equal success. They account for 85% of the sold properties for the last 3 months.

Often three-bedroom apartments sold in the early stages of construction, allowing you to combine several neighboring apartments and thus meet the needs of the most demanding customers.

Materials novinite.com

Photos Depositphotos.com

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The number of transactions in urban real estate in Bulgaria is growing

12% increase in the number of transactions for the purchase of real estate in Bulgaria for the first quarter of 2016 compared with the same period last year.

It seems that the market begins to revive after a long period of stagnation – this contributes to the decline in interest on deposits in Bulgarian banks and understanding the customers, that further lowering of prices will not makes sense to buy now.

The growth in the number of transactions of purchase and sale has led to higher prices on the real estate on average by 5-10% compared to last year.

The prices on the resort property, especially those not in the first line, continue to fall – now quite possible to buy apartments in Sunny beach (5-6 lines) for €10-15 thousand.

In this case demand only the real estate with favorable location (on the beach or near ski lifts).

At the same time, falling demand for rural property, and as a consequence prices: house with land in the Bulgarian provinces can now be purchased for 5-6 thousand BGN (€2,5 – 3 thousand).

c5f957faa8a0ae1e147ffc1acf8be627 - The number of transactions in urban real estate in Bulgaria is growing

According to the materials of rus.bg

Photos Depositphotos.com

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Chinese investors learn the Bulgarian market

€270 million plan to put Chinese investors in the reconstruction of a cargo airport in Radomir, as well as in the construction of luxury housing and commercial real estate at coast of Bulgaria.

It is reported that major Chinese construction company plans to invest €65 million in the reconstruction of the former Soviet military airfield and extending the runway, constructing a freight and passenger terminals and rail line to make the airport in Radomira (45 km from Sofia) is the country’s largest cargo airport.

With regard to investment in a luxury building, more than the €204 million will be invested by Chinese investors in the development of the Golf complex Thracian Cliffs at Cape Kaliakra: on site within the next 4 years will be built the hotel complex luxury, villas, Marina and casino.

It is expected that both transactions will be completed within the next three months and construction will begin in mid-2016.

According to the materials of rus.bg

Photos Depositphotos.com

 

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Bulgaria: the decrease of foreign investment

More than half declined over last year, foreign investment in Bulgarian property.

From January to November 2015, the amount that foreign buyers invested in the purchase of real estate in the country amounted to € 50.4 million For the same period in 2014 this amount was more than double at € 115.1 million

Traditionally, the main foreign buyers of real estate in Bulgaria remained Russians – despite the crisis they have brought the country’s budget is € 25 million (49.6% of total investments)

Moreover, the total foreign investment in the country’s economy for 2015 amounted to € 1.467 billion (3.3% GDP), € 251 million more than in the same period of 2014.

According to the materials of rus.bg

Photos Depositphotos.com

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HOW TO DECLARE TAXES FROM RENTAL REAL ESTATE

If you rent out a property or renting, then this article will be of interest to You.

I will try
to tell briefly and clearly.

The
important that you need to know regardless of whether you are renting or renting
lease, rental income subject to advance tax during the year.

Very often
found that landlords find various forms of not declaring taxes
with these revenues. For example, do not constitute a rental agreement, sign the contract on gratuitous
the use of the property, the use of friends or relatives, etc.
Of course, this is pure tax evasion and those who do should
know that they fall under liability.

At the same time
correct taxpayers should know that if they enter into a contract
lease-a legal entity, the obligations on the calculation, Declaration and
the payment of the tax imposed on a legal person-the tenant. Ie if you
legal entity-the lessee, you are required to pay advance tax for your
the landlord, who you hold with the monthly rental amount. And
only in the last quarter of the tax is not paid upfront, unless
the landlord has not stated it in writing.

Tax
shall be paid on a quarterly basis until the end of the month following the reporting quarter.

The legislator
also determined normative recognized costs of the lessor that do not
taxed at the rate of 10% of the amount of income. It has no value
who you going to rent – a natural or legal person.

If you
rent their property to a natural person, it is your responsibility
to pay advance tax on the income. This tax is paid before the end of the month
following the reporting quarter. If you forgot to pay the tax in
during the year, you should file an annual tax return where to point the amount
earned income and calculate the tax payable. Such a Declaration
available until 30 April for the previous year. In the same period paid himself
tax.

And on sanctions. For incorrectly
the data provided in declarations on incomes of physical persons, but only if
they lead to the arrears of tax or payment of tax, provided the sanction
up to 1 000 levs, and for repeated violation – up to 2 000 leva.

Olena Shopova

Planely Finance LTD

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The difference between EM EOOD and OOD

The most popular legal forms for conducting trading activities in Bulgaria are EM EOOD and OOD.

I suggest you consider some of the features of these shapes to make the right choice for your business.

Who can register a LTD.
OOD and EM?

If you have the desire
independently carry out trading activities, can choose legal
form between the ET and the LTD are. A sole trader can be registered by any competent
a natural person with domicile in the country (article 56 of the Trade law). As well
article 58 of the same law says that one person can register
only one ET.

Check EOOD (ednolichno fellowship with the limited otgovornost) can be registered by any natural or legal person (local or foreign).

The registration of OOD (a company with
limited otgovornost) can be registered in two or more physical
or legal persons (Bulgarian citizens or foreigners).

Any person (regardless of
fizicheskoe it or legal) may participate in more than one firm.

The required capital at
the registration of the company

There are no legal requirements
the minimum amount of capital when you check EM.

The minimum
capital at registration EOOD and OOD – BGN 2.

Materialna responsibility
founders/owners

Its debts sole
the merchant meets all of the assets of his company and his personal family, i.e.
unlimited property liability. This is a consequence of the fact that when
registration is not a new,second legal entity, ie a sole trader, and
a natural person who established it, is one and the same person.

The owner of the company is responsible for
the debts of their firms exclusively in the size of the share capital (limited
property liability) because the owner/founder and LTD is
two completely different legal entities. The law considers the company as
an independent legal entity.

The owners of the OOD answer
the debts of his company in the amount of their share in the capital of the company (limited
pecuniary liability), because the owners/founders and OOD is
completely different legal entities. The law considers the OOD as an independent
legal entity.

Patent tax and tax on
profit

Taxation is EM
according to the law on tax on personal income. tax Rate is 15%.

If the activities of the ET subject
under the activities described in Appendix 4 to the Law on local taxes and
the training camp, he will pay the patent tax.

LTD. and LTD. are not subject to
the patent tax. Their taxation is based on the Law on
corporate income taxation. The rate of income tax is
10%.

Tax on dividend

ET not taxed on
dividend. After paying income tax at 15% they can use
the profit for his personal needs, or keep it for business development.

For LTD. and LTD. the tax on the dividend
is 5%. Tax liabilities arise from the moment of taking decisions
owners/owner on distribution of the profit under the form of dividends.

Social security

The sole trader pays
social payments as a self-employed person. At the end of the year in the annual tax return
these social transfers are aligned on the basis of gross profit.

Owners LTD. and founders in
OOD can pay social charges on the basis of one of several
methods:

– as a self-employed person

– as a person working under contract
the management and control.

They do not justify ciplinary on
the end of the year.

Closing EM EOOD/OOD

Closure of ET in the Trade register
takes no more than 1 month.

Closing EOOD/OOD in the Trade
the register is only possible after the procedure to eliminate that
takes 6 months.

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I will be more profitable LTD or self employed?

Sooner or later, every freelancer comes to the question of what it will be

more profitable to work as a Manager in LTD or to register

as a specialist in the free practice. So in this article I will try to make comparison of these two types of activities. Of course, that the information provided here is basic. Since every business is very specific, in order to make your choice work for one or another system should be considered more carefully.

What you should know before
register LTD.

Advantages

Minimum capital – 2
Lev.

When you register an LTD, you
will be responsible for the debts of the company within amount of capital LTD., ie
do not respond with their personal property.

Have the right to increase or
reduce its capital at any time. This procedure is relatively complicated. As well
can attract co-founders, and their funds will increase the capital; can
to sell shares – in short, you are more flexible in attracting additional
funds.

Have the ability to use
tax benefits under ZKPO, to optimize taxes, social
contributions.

Disadvantages

The state fee for
check EOOD is quite high:

– 110 BGN if you are applying
in the window in the commercial register

– 55 BGN if you are applying
through the website of the Trade register.

It is also necessary to pay
the Commission of Bank for opening of account for capital preservation. On this account you
will be required to make an asset to your future company. capital.

If you decide to close the company,
the elimination procedure takes 6 months.

With the running of the company, you
are required to keep records, make and submit annual financial
reports, i.e. it is necessary to provide expenses for accounting services.

If you receive payment
of goods/services in cash, you should have a cash register.

When your company starts
to work, it needs to have a Manager that you want to pay social
payments. Social security Manager can be done in two
methods:

  • The management agreement
    and control – in this case, the minimum social threshold, above which
    calculated social payments is determined on the basis of economic
    the company’s activities.
  • Example

    You’re a consultant in the field of IT.
    Register the company with subject of activity “consulting in the field of
    computer technology“ and decide that you are going to pay ciplinary on the basis of
    agreement to manage and control. Activity your company will be
    to determine the minimum social threshold for your as a Manager. In
    your case it will be 1 008.00 LV. This means that the mandatory
    the monthly amount of social security payments for you will be 416.52 LP.*

    • As a self-employed person
      which itself pays for the payments. In this case, a
      Declaration on registration of self-employed persons. In 2019 the minimum social
      the income of 560 m., and a maximum of 3 000 BGN.

    Example

    If you decide to choose to pay
    social payments as a self-employed person, above the minimum threshold, then
    monthly payments will be 175.28 m.*

    !!! In respect of siperia
    the following should be noted: the agreement on the management and control equal to
    employment contract, this means that the minimum social threshold higher, so
    there are sitzplatze by the employee and by the employer, which
    case EOOD is one and the same person.

    Example

    If there is agreement about the
    management and control we have two parties to the agreement: the customer and the contractor. Customer
    is the party that holds the Executive to run the company. You like
    the owner of the company can trust its management, and to another person. In this
    you’ll look like a customer, and another person, the principal. Most often, LTD. and
    the owner and Manager are one and the same person. This means that if you
    doing business in the field of IT technologies and choose social
    the provision on the basis of the contract on management and control, the minimum
    social security income on the basis of which will be calculated social
    the payments will be 1 008.00 LV.

    As I mentioned above, the total amount of
    social security payments, which must be paid monthly, will be
    416.52 m., this amount will be distributed as follows:

    – amount of deductions due to
    artist – 138.91 m.,

    – tax on income of physical persons
    – 86.91 m.,

    – the sum of the deductions due
    customer – BGN 190.70.

    As in this case and
    the contractor and the customer are one and the same person, then you will cover the entire amount.

    !!! Therefore, more often elected
    form of social security is a self-employed person.

    Taxation

    Taxable profit is taxed
    corporate tax of 10%. If you want to get paid
    dividend, you will have to pay another 5% tax on the dividend.

    I want to draw your attention that
    earn income form dividend is possible only after the payment of the tax
    profit, i.e. at the end of the financial year.

    Example

    Your company has received
    taxable income of $ 5 000.00 BGN, consequently, the company
    will have to pay income tax in the amount of BGN 500.00. After tax
    net profit your company will make 4 500.00 BGN you have
    the right to pay in the form of dividends. But you must withhold tax
    dividend – 5% or in the case of 225.00 m. Thus, on its own account or on hand
    you will receive 4 275.00 LV.

    What you should know if you
    want to register as self-employed

    To engage in free
    the profession should make the registration in the register BULSTAT of Real
    writing.

    Advantages

    Easy and cheap procedure
    registration. Government fee is 10 BGN.

    More simplified reporting.

    Upon receipt of the cash payments
    funds are not required to have cash register.

    Has the right to regulatory
    recognized costs. Depending on the type of activity, experts on
    free practice are entitled to 25% of the total, or 40% upon receipt
    royalties. I.e. there is no need to raise invoices for the costs, because when
    filing the annual tax return taxable income will be immediately
    adjusted for these normative recognized costs. This is a big plus when
    if you don’t have big expenses.

    The procedure for deregistration
    quick and easy. You only need to apply the pattern.

    Disadvantages

    If you have a large percentage of
    the costs involved in your activity, this choice is not for you.

    Example

    In the General case, you have a 25%
    normative recognized costs, and they reduce your taxable income.
    Ie, if the income in 1 000.00 LV. in a month, recognized normative costs –
    250.00 BGN. Ie if to do its work you need, for example, rent
    premises, payment of utility bills, and they are above 250 m., it
    registration as a specialist in free practice isn’t profitable.

    At the end of the year you will need to submit
    tax return income received, in which also will be done
    alignment of social payments and income tax.

    Example

    You have chosen to pay social
    payments of the minimum income in the year you make regular
    social payments from the amount of 560 m. During the year You received and
    declared income in the amount of 10 000 BGN. This amount is divided by the months in
    have you carried out activities:

    10 000 : 12 = 833.33 m.

    833.33 LV. – it is, really
    you received monthly income. Ie you have income, the top of which you
    really made ciplinary during the year:

    560 X 12 = 6 720 BGN.

    and final income
    10 000 levs.

    The difference 10 000 – 6 720 = 3 280
    LV. is the income of the top which need to calculate ciplinary and their
    to amend the budget.

    Also note that individuals in
    free practice has unlimited liability for its debts.

    *- the amount given on the assumption that the person has a permanent residence
    or Bulgarian citizenship.

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    FREE PROFESSION/PRACTICE AND HOW TO TREAT IT

    We are all free in the choice of profession and place of work. But often

    people do not want to associate himself with one employer, to fixed working time and place. To implement this, our desires, the legislator we were kindly offered to be an expert on free practice.

    What is it?

    According to the Law on income tax of individuals (SNGPL)
    is a profession listed in §1, vol. 29, namely:
    experts-accountants, notaries, lawyers, auditors, private judicial
    artists, jurors, experts in the courts and Prosecutor’s offices,
    licensed appraisers, medical specialists, translators, architects,
    engineers, technical managers, artists, education, art and
    science, insurance agents, and to apply simultaneously the following conditions:

    – carry out professional activity on its own
    account

    – not registered as private entrepreneurs,

    – self-employed persons under the terms of the Code of social
    security.

    Persons engaged in free practice, can not
    to be a legal entity and all the costs of your activities will be at your expense, in
    and social payments.

    To exercise free practice, you need
    to register as such in the specialist register in the BULSTAT Agency for
    writing within 7 days from the time of the activity. After a successful
    registration get unified identification code (Eik), which coincides with the
    your EGN.

    Required documents for registration:

    – personal card,

    – application on registration of a person in the free practice,

    – a document proving
    required qualifications for activities, diploma, certificates etc,

    – Declaration of the truth
    the data provided,

    – a document confirming payment
    state fee – 10 BGN.

    After registration, you must submit to the NRA Declaration
    check self-employed person. She also served within 7 days after
    beginning of the activity. After such registration, each month following the month in
    reporting, by the 25th day you are required to declare and pay social charges.

    At the end of the tax year and the results of the year in the annual
    tax return is the alignment of social payments.

    Taxation

    The taxation can be various and depends on the type
    activities.

  • If
    the operations of the patent, the patent tax is paid on the basis of the Law on
    local taxes and fees. In this case, before starting the activity, you need
    submit in relevant community (or at the location of the object in which you
    will work, or at the place of their permanent address) the Declaration on the patent
    on the basis of article 61 of the Law on local taxes and fees. This same Declaration
    available until 31 January of each year.
  • If
    activity is not patent, the taxation is carried out on the basis of
    Law on taxation of income of individuals.
  • Persons pranayma free trade, are subject to
    law on the tax on value added. Registration for VAT normally
    is subject to a taxable turnover of BGN 50 000. 12
    consecutive months.

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    Patent tax – who to use

    Patent tax is a kind of lightweight net for small traders and artisans.

    For their activities they pay a patent tax (patent), it is not taken into the calculation of the profit or loss. Patent tax is an annual tax. It is regulated by the Law on local taxes and fees (SMNS). A link to the law https://www.lex.bg/laws/ldoc/2134174720

    This law established minimum and maximum
    the size of the patent tax, and each Community sets specific dimensions
    tax for different activities and for different areas in their territory.

    What are the conditions necessary to fulfill to become
    the payer of the patent:

    – a natural person, including private entrepreneurs,

    – carries out activities which are included in
    Appendix 4 SMNS (patent activities),

    – turnover for the previous year does not exceed 50 000 BGN,

    and the person is not registered for VAT, with the exception
    registration on the basis of article 99 and article 100, vol. 2 of the Law on value added
    cost.

    Persons engaged in patent activities, not
    levied in the manner prescribed by the law on taxes on income of individuals.

    So why is the payment of a patent can be very profitable?

    Consider a simple example:

    Entrepreneur is engaged in tailoring,
    implements the annual turnover in the amount of 45 000 leva and has expenses in the year in
    the amount of 5 000 leva. The patent tax is determined depending on the location
    his Atelier, but if you calculate its maximum size from 840 m., it will be
    less than accrued income tax of physical persons 15% (6000
    LV.), also Supplement social security payments or, if we are registered as a LTD.
    – payment of 10% tax and after 5% tax on the dividend.

    What activities come under the patent tax?

    They are described in Appendix 4 SMNS:

    – places to stay, but not more than 20 rooms

    restaurants, tearooms, bars,etc.

    – retail trade up to 100 sq m net sales area
    object

    services (woodworking, sewing services, Shoe
    services, hairdresser, typewritten, cosmetic services, watchmaker, upholstery
    services, auto repair, glass and others),

    – sale of Newspapers, magazines and other

    games entertainment (mini football, table
    tennis and other);

    – pawnshops,

    services entertainment (boats,
    trains, carousels),

    – training of voditeley cars;

    – paid Parking,

    – other.

    Declaration

    Individuals who must pay a patent tax, served
    tax return according to the pattern in which declare until 31 January of the current
    years of circumstances that are associated with the determination of the amount of the tax. If you
    starting the activity after this date, the tax return is filed
    pre-start activities.

    Link to the Declaration

    Other features of the patent

    When within 12 consecutive months
    (note!!! consecutive months, not a year) one
    a natural person has terminated patent activity and/or formed new
    the company, which performs patent activity, and total turnover
    the two companies more than 50 000 levs. for 12 consecutive months, for the current
    the year the newly formed company is subject to the General conditions under the law on
    income tax of individuals.

    If in the current tax year the turnover of the person
    exceed 50 000 BGN. or the person registers under the law on tax on
    added value, you will be taxed on General terms under the law on
    income tax of individuals.

    In the above cases, patent tax for the current year shall be
    payable until the end of the quarter before the quarter in which any of these
    circumstances. Amended tax reduces the tax obligation under the terms
    law on income tax of individuals.

    If in the current tax year the person will be
    zaregistrirovano according to the law on value added tax, then
    taxation will be carried out on General conditions in the tax act
    individuals ‘ income for the whole tax year.

    If you have some patent activities,
    the patent tax is paid for each separately.

    If the activity is carried out in multiple sites
    the patent tax is paid for each object separately.

    The patent tax is paid every quarter – until the end
    of the month following the reporting quarter or within 7-days term from filing
    the Declaration of the beginning of patent activity.

    The tax is paid in the community where the object or
    the permanent address of the person.

    If, before January 31 shall be paid all the tax for the patent
    the whole year, the person has the right to use a discount of 5%.

    Income from activities not listed in Appendix
    4, shall be taxable on General terms according to the law on personal income tax
    entities.

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    Annual financial report and filing of annual tax return

    Year-end closing and submission of annual tax returns is a mandatory part of accounting of any enterprise. At the end of the year it is necessary to determine the financial result on the basis of the carried out during the year of activity of the enterprise. In plain language – it is necessary to determine the profit or loss received the company at the end of the year.

    After the closure of accounts for the calendar year and determine the financial result, you need to complete and submit annual tax returns Natsionalna agentsiya over Come (HAΠ), as well as to prepare and submit an annual report to the National Cтaтиcтичecĸи Institute (NSI). An important part of fiscal year closing is the preparation and publication of annual financial reports in the commercial register.

    Annual tax return is submitted until 31 March of the year following the reporting year
    (for example, to March 31, 2019 the deadline for the submission of the Declaration for 2018) Supply
    the Declaration is done electronically. In the annual tax return
    determined by the annual corporate tax (tax on profits),
    which the company must pay. Today corporate tax rate
    Bulgaria 10%. Corporate tax to be paid also by 31 March. Payment
    is on Bank account of the respective office NAP at the place of registration
    enterprise.

    Tax is usually paid once a year, but
    depending on company’s turnover for the previous year, it may be
    the obligation to pay quarterly or monthly advance contributions
    corporate tax.

    Enterprises that are not operated in
    throughout the year, are exempt from preparing and filing the annual tax return.
    These companies served in the NSI report that the activities during the year they are not
    conducted and the Declaration in the commercial register, the owner of the company with the same
    content.

    If You have additional questions on the topic
    closing the year, do not hesitate and contact us for more
    information or to request services.

    No Comments

    New requirements for cash registers in Bulgaria

    New amendments to the Ordinance № H-18 of 13 December 2006 on the registration and report through the fiscal device sales in retail facilities, the requirements for software to control and requirements for persons who carry out sales via e-shop. The changes relate to reporting of financial devices sales at retail, the software requirements for their management and requirements for online trade (http://dv.parliament.bg/DVWeb/showMaterialDV.jsp…) require that information about each new purchase, paid by cash, cheque, voucher, debit or credit card or other means for the exchange of money, went in for five minutes to the servers of NAP. Each check must have a QR code. After scanning the customer to check whether sent data on purchases in the NAP.
    All registered for VAT the company must begin to comply with the new requirements until the end of March 2019. The deadline for all other, including gas stations – until the end of June 2019, and for those who utilizes the integrated automated control systems to trade by the end of 2019. To check if the revision of your cash register to meet the new requirements you can use the link http://nraapp02.nra.bg/fdlookup/