Whether you’re an individual or a business owner in Bulgaria, there are several tax benefits you can take advantage of. Here’s an overview of the most important reliefs and incentives.
Tax Relief for Individuals and Families
- Children Tax Relief: a deduction from your annual taxable base of EUR 3,067.75 for one child, EUR 6,135.50 for two and EUR 9,203.25 for three or more — worth EUR 306.78 of tax saved per child. For a child with a disability the deduction is EUR 6,135.50.
- Mortgage Relief: young families can deduct the interest paid on the first EUR 51,129.19 of the principal. One spouse must have been under 35 when the loan was signed, and it must be the family’s only home.
- Reduced Work Capacity: a deduction of EUR 4,049.43 for people assessed at 50% or more.
- Donations: deductible up to 65% of the annual taxable base, depending on the recipient.
- Voluntary Insurance Contributions: up to 10% for voluntary pension insurance and a further 10% for voluntary health insurance and life assurance.
- Home Improvements: labour costs up to EUR 1,022.58 on work done to your own home, a maximum saving of EUR 102.26, and the expense must be documented.
- Cashless Payments: a small relief where you received taxable income by transfer and spent at least 80% of it without cash.
- E-filing Bonus: If you submit your annual tax return online and pay the tax due by March 31, you receive a 5% discount on the tax owed (up to EUR 255.65), provided you have no outstanding public debts at the time.
Business Tax Incentives
- R&D and Innovation Incentives: Expenses for research and development may be deducted or supported under specific programs.
- Regional Investment Relief: Companies investing in underdeveloped areas may benefit from partial or full corporate tax exemptions.
- Donations and Sponsorships: Corporate donations to approved organizations are deductible up to a defined limit.
Every personal relief above carries one common condition: you must have no enforceable public debts when you claim it. Check your tax account before you file, not after.
Work out what you can claim on the tax reliefs calculator, and see the filing dates on the tax calendar. Taking advantage of tax incentives is a smart move for individuals and growing businesses alike — talk to us about which apply to your situation.