Substantial changes have been introduced into Bulgarian tax legislation in 2018. Here are the key amendments for 2018 that you need to know about:
I. Amendments in the Personal Income Taxation Act
1. According to the new Art. 50a of the Personal Income Taxation Act (PITA), the following facts may now be declared in the tax return:
- Non taxable income
- Inherited property or property received by covenant or donation
- Received property with a restored right of ownership
The purpose of the alteration is individuals possessing significant property to be relieved in the procedure of proving their available funds in the event when the property held and the declared taxable income differ significantly.
2. Companies, acting as payers of income, submit the tax return only electronically (Art.56, para 2 PITA)
3. Individuals are obliged to submit with the annual tax return evidence regarding the amount of taxes and social security contributions paid abroad.
4. The time limit for filing a statement of paid incomes is significantly reduced – until 15 of March of the ensuing year, before the territorially competent division of the National Revenue Agency.
5. Tax relief is applicable in case the tax return is submitted electronically until 31 of January of the ensuing year. The maximum amount of the discount is reduced to 500 BGN.
II. Amendments of the Value Added Tax Act
One of the major alterations of the Value Added Tax Act (VATA) is related to the reduced time limit for applying for registration – the term has been reduced from 14 days to 7 days, as of the date the legal ground for registration occurred.
Art. 96 (1) of the VATA imposes an obligation to file a registration application when the taxable turnover from BGN 50 000 is reached during a period, longer than two consecutive months. The time limit for filing the registration application is 7 days.
We strongly advise to pay particular attention of the deadlines – VATA envisages administrative penalties in case you miss them (Art. 102, para 4). The taxable person who has failed to submit the necessary registration application on time, will be charged value added tax (VAT) for the taxable deliveries, exceeding the taxable turnover of BGN 50 000, for the period from the date the company went over the threshold until the date of registration under the Value Added Tax Act.
An important change under the Value Added Tax Act is that the reference-declarations and the VIES-declarations under Art. 125 are now submitted electronically.
III. Accountancy Act Amendments
The major changes it this Accountancy Act are associated with eliminating part of the administrative burden for the small business.
The requirement for submitting an annual financial report by enterprises, which have not operated during the reporting period, has been dropped for the cases when the declaration for the lack of economic activities has been timely submitted in the Commercial Register.
The enterprises which fall into the categories of small micro or small enterprises, have the opportunity to submit only an abridged balance sheet and abridged income and expense statement, instead of the full set of financial reports.
This publication is written in the context of Bulgarian legislation, effective on June 03, 2018.Please note that future amendments in the relevant legislative acts, court decisions or opinions of official authorities or other sources of legal obligations, which became effective after the quoted date, may affect the accuracy of the information above. This is one-time publication and Prosperamo is not responsible to keep it up-to-date. For more information – please read the following disclaimer.
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