Is Bulgaria's 10% corporate tax really 10%?

Effectively yes for a clean company that distributes nothing. If you take dividends, add 5% withholding, putting the combined effective rate around 14.5% at the shareholder level. Still significantly below most EU jurisdictions.

When can I deduct VAT paid on purchases?

VAT is a separate filing. Input VAT is reclaimed in the monthly VAT return, not the corporate tax return. Corporate tax operates on net amounts (excluding VAT) once the company is VAT-registered.

What if my company has no activity?

You still file an annual corporate tax return, even with zero activity. Penalty for missed filing is 500 to 3,000 BGN (256 to 1,534 EUR) plus interest.

Do I need to file an annual financial statement if my EOOD is dormant?

Yes. Every commercial entity registered with BRRA must file an annual financial statement by 30 September, even if dormant. Penalty for missed filing escalates over time.

Can a foreign parent receive Bulgarian dividends tax-free?

Yes, under the EU parent-subsidiary directive — if the parent is an EU/EEA company, holds at least 10% for at least 1 year, and meets the directive's conditions. Otherwise the default 5% withholding applies, possibly reduced by tax treaty.

How do I know if I'm liable for advance payments?

Look at last year's annual corporate tax return — if the tax profit exceeded 300,000 BGN (153,388 EUR), advances apply this year. Your accountant calculates the instalment in January.

Corporate Tax in Bulgaria 2026 — ZKPO Guide for Businesses

Bulgarian corporate tax 2026: 10% flat rate under ZKPO, deductible expenses, dividend withholding, advance payments, loss carryforward. By Fakturka.bg.