What is the VAT rate in Bulgaria?
Bulgaria's standard VAT rate is 20%. A reduced rate of 9% applies to hotel accommodation, restaurants and catering, books, baby food, and certain tourist services. The VAT registration threshold is BGN 100,000 annual taxable turnover. Monthly VAT returns are due by the 14th of the following month.
Detailed Explanation
Bulgaria is a full EU VAT member and applies the EU VAT Directive framework. The main VAT rates are as follows:
Standard rate: 20%
The 20% rate applies to most goods and services supplied in Bulgaria. This includes professional services, software, e-commerce, retail goods, construction, consultancy, and most business-to-business supplies.
Reduced rate: 9%
The 9% reduced VAT rate applies to: - Hotel accommodation and short-term rental accommodation (Airbnb-type lets) - Restaurant and catering services (food and non-alcoholic beverages served in restaurants, cafes, bars, and similar establishments) - Books (physical and e-books since 2021 EU alignment) - Baby food and nappies - Certain tourist services when part of a package holiday
The 9% reduced rate was introduced as a temporary measure during the COVID-19 pandemic and has been extended repeatedly, becoming a permanent feature of Bulgarian VAT law.
Zero rate: 0%
The zero rate applies to: - Intra-EU supplies of goods to VAT-registered buyers in other EU member states - Exports of goods outside the EU - International transport services - Some financial services related to exports
Zero-rated supplies are taxable supplies at 0%, meaning input VAT on related costs is fully recoverable. This is different from VAT-exempt supplies.
Exempt supplies
Certain supplies are exempt from VAT and do not allow input VAT recovery: - Financial services (lending, insurance) - Healthcare services - Educational services - Rental of residential property for living (but not hotel/short-term rental) - Certain land transactions
VAT registration threshold: BGN 100,000
A Bulgarian business must register for VAT when its taxable turnover in the preceding 12 calendar months reaches BGN 100,000. This is an annual rolling threshold, not a calendar-year threshold. You have 14 days from the end of the month in which you crossed the threshold to apply for VAT registration.
Voluntary VAT registration is available at any time below the threshold. This is common for businesses that purchase significant VAT-bearing inputs or deal primarily with other VAT-registered businesses.
For businesses receiving services from non-Bulgarian suppliers (for example, Google Ads, AWS, LinkedIn, Zoom, Slack), a mandatory VAT registration applies from the first purchase, regardless of turnover, if the total value of such intra-EU services exceeds BGN 20,000 in a calendar year.
Monthly VAT returns: Vat14 form
All Bulgarian VAT-registered businesses file monthly VAT returns using the VAT14 form, submitted electronically via the NRA portal. The deadline is the 14th of the month following the reporting period. There is no quarterly option in Bulgaria (unlike the UK). For example: - January VAT return: due by 14 February - February VAT return: due by 14 March
VIES declaration for intra-EU trade
If you supply goods or services to VAT-registered businesses in other EU member states, you must also submit a VIES (VAT Information Exchange System) declaration monthly, listing each EU customer's VAT number and the value of supplies. This is submitted alongside the Vat14 return by the 14th of the following month.
Input VAT recovery
VAT-registered businesses can recover input VAT on purchases used for their taxable business activities. The standard method is invoice-based: you need a valid Bulgarian VAT invoice from your supplier showing their VAT number, your VAT number, and the correct VAT amount. Input VAT is claimed on the monthly Vat14 return.
VAT on digital services to consumers
If your Bulgarian company sells digital services (apps, software, e-books, streaming) to consumers in other EU countries, you may need to register under the One Stop Shop (OSS) scheme rather than registering for VAT in each member state separately.
Annual VAT summary return
In addition to the 12 monthly Vat14 returns, Bulgarian VAT payers must file an annual VAT summary return (Spravka-deklaratsiya) alongside the corporate income tax return in March. This reconciles the year's total output and input VAT.
Source: nra.bg
Real-World Examples
Restaurant owner applying the 9% reduced rate
A Sofia restaurant owner charges customers for food and soft drinks at the table. Under the 9% reduced VAT rate, a BGN 100 meal bill includes BGN 8.26 VAT (9/109 x 100). The restaurant owner remits this to the NRA via the monthly Vat14 return due on the 14th of the following month. Beer and wine at the bar are also at 9% under the restaurant exception.
Software company crossing the BGN 100,000 threshold
A Bulgarian EOOD providing software development services to local clients reaches BGN 100,000 in taxable turnover in October 2025. The owner applies for VAT registration within 14 days of the end of October (so by 14 November 2025). From 1 December 2025, the company charges 20% VAT on all invoices and files monthly Vat14 returns by the 14th of each following month.
UK consultancy supplying services to a Bulgarian company
A UK-based consultancy invoices a Bulgarian OOD for advisory services. The Bulgarian company applies the reverse charge: it self-accounts for 20% Bulgarian VAT on the invoice value, declaring it as both output VAT and input VAT on the same Vat14 return. No actual cash changes hands for the VAT amount if the service is fully used for taxable activities, resulting in a net-nil VAT position on that transaction.
Common Mistakes to Avoid
- Applying the standard 20% VAT rate to restaurant and hotel services instead of the 9% reduced rate, overcharging customers and creating a refund liability.
- Missing the mandatory VAT registration trigger for intra-EU service purchases (the BGN 20,000 annual threshold for digital services received from non-Bulgarian EU suppliers is separate from the BGN 100,000 general turnover threshold).
- Filing VAT returns late or missing the 14th monthly deadline: even a one-day delay triggers automatic NRA penalties of 0.05% of the tax due per day.
- Failing to include VIES declarations when supplying intra-EU B2B services: VIES is a separate monthly submission but due on the same 14th deadline as the Vat14 return.
Frequently Asked Questions
When must I register for VAT in Bulgaria?
You must register for Bulgarian VAT when your taxable turnover in any trailing 12-month period reaches BGN 100,000. You have 14 days from the end of the month in which you crossed the threshold to submit a Vat1 registration application to the NRA. Separately, you must register immediately if you receive intra-EU services (e.g., from Google, AWS, LinkedIn) exceeding BGN 20,000 in a calendar year.
Can I voluntarily register for VAT before reaching BGN 100,000?
Yes. Voluntary VAT registration is available at any level of turnover. It is beneficial if your customers are VAT-registered businesses who can reclaim the VAT you charge, or if you have significant input VAT to recover on purchases, equipment, or premises.
How often do I need to file VAT returns in Bulgaria?
All Bulgarian VAT-registered businesses file monthly VAT returns using the Vat14 form. The deadline is the 14th of the month following the reporting period. There is no quarterly VAT return option in Bulgaria.
What is the reverse charge mechanism in Bulgaria?
When a Bulgarian VAT-registered business receives a service from a non-Bulgarian supplier (for example, Google Ads, a UK law firm, or an EU SaaS provider), it applies the reverse charge. The Bulgarian company self-assesses the Bulgarian VAT (20%) on the invoice, reports it as output VAT and (if fully used for taxable activities) simultaneously reclaims it as input VAT on the Vat14 return. No cash changes hands for the VAT.
Is Bulgarian VAT the same for digital services sold to EU consumers?
If your Bulgarian company sells digital services to consumers in other EU countries, you must charge the VAT rate of the consumer's country (not Bulgaria's 20%). You can handle this by registering for the EU One Stop Shop (OSS) scheme, which lets you file a single OSS return rather than registering for VAT in every EU country where you have customers.
Practical Tips
- Set a calendar reminder for the 14th of every month: missing the Vat14 deadline even once triggers automatic NRA penalties, and the penalties compound daily.
- When you cross the BGN 100,000 threshold, update all invoice templates immediately to include your Bulgarian VAT number (BG + 9-digit UIC) and the correct 20% VAT amount.
- If you receive services from Google, Meta, LinkedIn, or other EU-based digital platforms, track the annual total: once it exceeds BGN 20,000, you must register for VAT regardless of your own revenue.
- Keep copies of all supplier VAT invoices showing your company's VAT number: input VAT can only be recovered on properly issued invoices where your VAT number appears.
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