Can I Claim VAT-Recoverable Inputs as a Business Expense in Bulgaria?
Yes, input VAT on business expenses is recoverable through the monthly VAT return for VAT-registered businesses. Standard rate 20%. Reverse charge applies for cross-border services and intra-EU acquisitions.
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What National Revenue Agency (NRA / НАП) says
The VAT Act allows recovery of input VAT on supplies used to make taxable supplies. The NRA says the tax period is one calendar month and a return must be filed for every period, including periods with no purchases or sales. The return and the sales and purchase ledgers are due by the 14th of the following month, and the return shows output VAT, input VAT credit and the result. VAT on entertainment is blocked from input recovery. Reverse charge purchases are recorded in both ledgers.
When you can claim
- Office rent VAT at 20%
- Equipment and software purchases
- Professional services from VAT-registered providers
- Reverse-charge purchases, recorded in both the sales and purchase ledgers
- Hotel accommodation, which carries the 9% reduced rate
When you cannot claim
- VAT on entertainment expenses
- VAT on private-use proportion of mixed-use items
- VAT on supplies that are themselves exempt
Good to know
Pro tip: Match every purchase invoice to the right ledger period. Include documents you find after the deadline in the ledger for the period when the error is found, and notify the tax authority in writing if a document was recorded wrongly. File a nil return even for a month with no purchases or sales.
Important: The NRA states that filing late carries a fine or property sanction of €255.65 to €5,112.92. Registration for VAT is mandatory above €51,130 of annual turnover from 1 January 2026, so check the threshold early in the year. Voluntary registration is also allowed below the threshold, so a business under the threshold can choose to register.
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