In recent years, Bulgaria has become an increasingly attractive destination for foreign nationals looking to work or start a business in the country. This is no surprise, considering Bulgaria’s strategic location, low taxes, and favorable business environment. However, the process of setting up a business or starting work in Bulgaria may be accompanied by bureaucratic requirements and legal challenges, especially for foreign nationals. In this article, we will explore the key steps and requirements for foreign citizens wishing to work or open a business in Bulgaria.
1. What Documents Are Needed to Work in Bulgaria?
If you are a foreign national and wish to work in Bulgaria, the first thing you need to do is ensure you have the required documents to work legally. These typically include:
- Work visa or work permit – depending on your nationality.
- Bulgarian personal identification number (EGN) – required for tax and social security purposes.
- Employment contract with a Bulgarian employer – to start working in Bulgaria, you must have a signed employment contract with an employer.
Foreign nationals from non-EU countries must undergo additional steps to obtain a work permit and visa.
2. How to Open a Business in Bulgaria as a Foreign National?
Opening a business in Bulgaria is particularly attractive for foreign entrepreneurs due to favorable tax conditions and a straightforward registration process. Here’s what foreign nationals need to know:
- Choose a legal structure – The most common business structure for foreign nationals is the EOOD (Single-member limited liability company) or OOD (Limited liability company). You can easily register these companies through the Commercial Register.
- Provide a Bulgarian address – You need a Bulgarian address for business registration. Additionally, you must appoint a company manager.
- Representation in the country – If you are not permanently in Bulgaria, you will need to appoint a representative who can handle daily business activities.
Once you register, you will need to register for VAT if your annual turnover exceeds BGN 100,000. You must also submit tax and social security declarations.
3. Tax Obligations for Foreign Nationals in Bulgaria
Bulgaria offers a simple tax system that is appealing to foreign nationals. Here are the key taxes to be aware of:
- Personal income tax – Foreign nationals pay a flat rate of 10% on personal income, including wages and earnings
- VAT – The standard VAT rate in Bulgaria is 20%, and if you are a business owner, you will need to register for VAT if your turnover exceeds a certain threshold.
- Social and health insurance – All employees, including foreign nationals, must contribute to social and health insurance.
4. Social Insurance and Health Insurance for Foreign Nationals in Bulgaria
Foreign nationals working in Bulgaria are subject to social and health insurance, which provides access to health services and pensions:
- Social insurance – mandatory for all employees in Bulgaria.
- Health insurance – provides access to the national healthcare system.
When registering for employment, the employer is obligated to ensure that social and health insurance is paid for their employees.
5. Rights and Obligations of Foreign Nationals Working in Bulgaria
Foreign nationals working in Bulgaria have the same rights as Bulgarian citizens under the labor law. These rights include:
- Minimum working conditions, breaks, and vacations.
- Protection against discrimination and unfair treatment.
- Equal rights to healthcare and pension benefits as Bulgarian citizens.
Working and starting a business in Bulgaria presents many opportunities for foreign nationals. The country offers a favorable business climate and low taxes. However, you must understand the tax and legal systems and follow the necessary procedures. If you want to work or start a business in Bulgaria, consult with an accountant or lawyer. They can guide you through the process and help you meet all requirements.
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