You have to work on the business first before it works for you.Idowu Koyenikan
New challenges and new benefits
Incorporating in Bulgaria through a trusted agent with legal compliance as paramount
Incorporating in Bulgaria is more difficult than ever before, there is no doubt about that. Still, it is definitely worth the hassle as the benefits are greater than ever. With our support, you will not only optimize your taxes and enhance your profits. You will also enjoy better capital protection by diversifying your projects through incorporation in one of the most stable EU jurisdictions.
Why should you incorporate your company in Bulgaria
One of the main advantages of the companies incorporated in Bulgaria is the extremely low tax rate in the country.
Bulgaria applies ridiculously low (especially by EU standards) tax rate of only 10% flat. This rate applies to both corporate and personal income. One very important advantage is that the 10% tax rate is flat – it doesn’t depend on the amount earned. In most countries, the general rule is that the higher the amount earned, the higher the tax rate. This is seen by many as unfair as even with flat rate (as in Bulgaria), those earning more, logically end up paying more in taxes (as they have higher tax base). Flat rate is especially beneficial for companies that have significant earnings that would otherwise lead to extremely high taxation in the EU, in many cases in excess of 50%. Companies with lower income expectations will still benefit immensely from the Bulgarian tax regime, as 10% is simply the lowest in EU and in all other reputable jurisdictions. Lower rate than that, one can only find in some distant offshore islands, which are not accepted for doing legitimate business with (one can’t even open bank accounts in reputable jurisdictions for such companies).
There are also many other tax advantages in Bulgaria, such as low tax on dividends, low municipal taxes (great for investments in real estate), etc. The large number of double tax avoidance treaties that Bulgaria has signed provides another layer of certainty to the business entrepreneurs willing to incorporate in Bulgaria.
Professional administrative and accountancy support
Incorporating through our formation services department will not only guarantee you legally compliant registered company, but will also provide you an access to a wide range of additional services and customer support.
Accountancy is always an issue that needs to be dealt with from the very beginning. Each new company needs to have its books in order, especially in highly trusted (and legally compliant) jurisdictions, such as the European Union. This task is often a real challenge for the foreign entrepreneurs when they incorporate and start business in another country. Bulgaria makes no exception of this rule. With our accountancy services however, you will need not worrying about accountancy and bookkeeping. Our specialists will take care for all accountancy requirements of your company. They will make the monthly bookings and declarations, VAT filings, annual reports, tax declarations and much, much more. The best option for you is to commission us on turnkey basis so you can have 100% guarantee for the legal tax standing of your company so you can enjoy maximized earnings through comprehensive legal tax optimization. Each of our accountants is backed by highly skilled tax lawyer to ensure ultimate compliance in areas where specialized legal assistance is needed.
Having registered office in the country is another problem for the foreign business, willing to incorporate company in Bulgaria. With can not only provide a registration office in Sofia for the incorporation of your entity, but can also offer you wide range of additional services through our virtual office packages.
In some cases, incorporating a company in Bulgaria can help non-EU citizens to obtain legal residence in Bulgaria. For instance, by hiring 10 or more Bulgarian nationals in your Bulgarian company, you can obtain residency permit. Alternatively, if you incorporate a company in Bulgaria, you can apply for work permit for any non-EU national to work in your company. If that is your goal, we urge you to contact our immigration department at Posolstvo.eu.
How to register a company in Bulgaria
Choice of company type
The company registration process in Bulgaria starts with careful consideration of what type of company you really need. The Bulgarian commercial law specifies wide range of corporate entities, however the following 3 are most commonly utilized:
- Sole trader (ET);
- Limited Liability Company (EOOD, OOD);
- Joint-stock company (EAD, AD).
The other (company) legal forms can be naturally also registered, but as they are much more complicated, we would advise you to visit us in our office for legal consultation on the matter. We will also explain you the differences, the pros and cons of each company type. If that is your intention (to register company with more “exotic” legal form), then please contact us in advance in order to book you an appointment in our offices.
Choice of name and business activities
The next step is to choose the name of your company. All names are written in Cyrillic and can be written additionally in English (Latin). We will check whether your chosen name is available and if not, we will request you to provide an alternative one.
The business activities that the newly formed company will be performing will also need to be registered with the authorities. As some of the activities may be subject to licensing regime or other restrictions, we will work closely with you to determine the best approach and draft the legally suitable wording in all documents.
Deciding on the company capital
The company capital can be as low as 2 BGN (about 1 EUR), but we recommend to our customers to register (much) higher initial capital. This will not only be perceived with higher confidence by all future partners of the company, but will also provide better options to split the shares of the company (at a later stage). Additionally, if the company needs initial capital to cover start-up expenses (ie opening office), the initial company capital is the best option and the most economical one.
Preparation of the documents
We will prepare all company documents, including the memorandum, the first minutes and all necessary forms and declaration. If you can not visit Bulgaria to sign the forms personally in front of Bulgarian notary public, we will prepare a special POA so you can legalize the required documents with the Bulgarian embassy in your country or with a notary public (an apostile and translation will be required in this case).
Once the documents are prepared and signed, the seed capital bank account opened and the company capital deposited (can be as low as 1 Euro), we will proceed with the registration of the new company in the commercial register.
Registration in the commercial register
Once all of the above is completed, our lawyer will register your company with the commercial register in Bulgaria. For added security, we use electronic registration that guarantees ultimate protection.
The follow-up services
Once the company is dully registered, we will provide additional services, such as accountancy fillings, VAT registration, apostille of corporate documents services, translations, legalizations and many more.
As this article on company formation provides only a brief information about all steps of the registration process, we urge you to contact us for any additional information you might require.