New VAT Reporting Requirements for Small Businesses

In 2025, small businesses in Bulgaria will face new VAT reporting requirements aimed at simplifying the tax process and increasing transparency in tax filings. The new rules will affect how businesses report VAT on their goods and services.

What’s changing?

1. Monthly VAT Reporting for Small Businesses:
   Previously, VAT reports for small businesses were filed quarterly. However, from 2025, the reporting frequency will change to monthly, meaning small businesses will need to submit VAT declarations every month.
2. Digital Invoicing:
   Another significant change is the shift towards digital invoicing. All businesses must issue electronic invoices for transactions exceeding a certain threshold. This new method will help reduce administrative errors and ensure quicker processing of VAT refunds.
3. Simplified VAT Calculation for Micro-enterprises:
   Small businesses with turnover below a set amount will have simplified VAT calculations. The new reporting method will help these companies reduce their administrative burden.
4. New E-Reporting Platform:
   The National Revenue Agency (NRA) is rolling out a new e-reporting platform that allows businesses to submit their VAT reports online. This platform will also include tools to help businesses automatically calculate their VAT liabilities based on their invoices.

What Small Businesses Need to Do:

• Review your VAT reporting frequency: Make sure you are prepared for monthly VAT filings starting in 2025.
• Switch to electronic invoicing: Begin issuing digital invoices for your transactions, if you haven’t already.
• Get familiar with the NRA’s new platform: Start using the NRA e-reporting platform to ensure a smooth transition and avoid delays in your VAT filings.

By preparing in advance, small businesses can avoid penalties and fines for non-compliance with the new VAT rules. Your accountant can help you prepare for the changes.