Updated last 18.06.2025
General information
The value added tax (VAT) is regulated by the Value Added Tax Act (VATA) and the Rules on the Application of the Value Added Tax Act (RAVATA), which implement in the Bulgarian legislation the rules of Directive 2006/112/ЕО on the common system of value added tax in the EU. The European VAT legislation may be found on the following website.
VATA differentiates between taxable and exempt supplies of goods and services.
According to the Act the following supplies may give rise to an obligation to charge VAT:
- Local supplies of goods or services;
- Intra-community acquisitions of goods or services;
- Import of goods.
Exempt supplies are stipulated in Chapter Four of VATA. Generally these include supplies related to healthcare, social care, education, sports or physical education, religion, supplies of non-profit nature, supplies of financial services, supplies of insurance services, gambling, supply of post stamps and postal services, as well as supplies of goods or services for which no right of tax credit was used.
As a rule 20% VAT is charged on all local supplies, intra-community acquisitions of goods, import of goods and services with a place of supply in Bulgaria. The Bulgarian VAT system envisages a reduced 9% rate for hotel accommodation services.
With a reduced rate of 9% in connection with the consequences of COVID-19, the deliveries of:
- Books and journals: The reduced rate of 9% for books (on paper or electronic) and printed journals was introduced temporarily, but subsequently became a permanent measure. In other words, the supply of books and periodicals continues to be taxed at 9% VAT even after 31.12.2021, and this preference has no end date.
- Infant and young children’s foods; baby diapers and hygiene products: Similar to books, the reduced rate of 9% for baby foods and products (e.g., purees, cereals) and for baby diapers/hygiene items became permanent. These goods were initially on the list of temporary COVID-19 measures, but since the end of 2022 the law treats them with a permanently reduced VAT of 9%.
How is VAT reported?
The obligations to report and pay VAT arise after registration under VATA. Registration may be mandatory – if certain criteria specified in the VAT Act are met, such as reaching a taxable turnover of BGN 100,000 [*] for the last twelve months, or voluntary as chosen by the person. The registration can be done also ex officio by the NRA, in case there are grounds for mandatory registration and the person has not submitted an application for registration within the prescribed time limits. In this case, the administrative penal provisions provided for in the law will be applied to the person. Additional information is available on the website of the NRA.
VATA registered persons are obliged to issue the documents regulated in the VAT Act and the Regulations for its application for each delivery made by them. In certain cases, the registered persons have an obligation to issue documents also when they are recipients of supplies, such as to issue protocols for received supplies of services from abroad, for intra-community acquisition of goods, etc.
The information from the documents mentioned above should be included in the purchases and sales ledgers, which the registered person should keep.
VATA registered persons are obliged to report the supplies of goods and services made and received by declaring and paying the VAT due to the state budget on a monthly basis.
VATA registered persons are obliged to file monthly VAT Reference return in a standard form. The return is filed only electronically via the NRA system, with the exception of cases set out in detail in the VATA. Additional information on the electronic filing of the VAT return is available at the following web address.
| Term | The deadline for the filing of the return is the 14th day of the month, following the reporting period (month). The return is drawn up based on the information available in the ledgers, where are included the issued and received in the respective month documents. The registered person is obliged to file the purchases and sales ledgers together with the return for the respective month. It is important to know that return should be filed even when the person has not made any supplies during the respective calendar month. |
If the registered person has made intra-community supplies of goods or services with a place of supply in another EU member state, the person should file VIES-return, where these supplies are included. Additional information on the VIES return is available at the following web address.
As a rule, VAT should be charged by the supplier. However, the Act stipulates explicitly situations (Art. 84, Art. 163a of VATA, etc.) where the recipient of the supply is obliged to charge the VAT and pay the tax themselves (in most cases in intra-community acquisition of goods or services, also when purchasing goods under Annex № 2 – waste, grain and technical services, etc.).
| Important to know | |
 | It is important to know that payment of VAT should be made within the deadline for its declaration (by the 14th day of the month following the reporting period). Payment may only be made via bank transfer to the NRA accounts. In this respect you have to have in mind that the different territorial directorates of the NRA have different bank accounts, which are available on the website of the NRA. Furthermore, in the payment order companies should include a specific code for the specific tax due, as otherwise they risk paying other tax liabilities (if there are such outstanding and eligible). |
When and how is VAT refunded?
VAT is subject to refund as a result of exercising the right to tax credit. The right to tax credit is the possibility to deduct the VAT paid for the supplies received by the person /input VAT/ against the VAT due calculated on the basis of the taxable supplies made by the person/output VAT/.
The right to tax credit arises only when the supplies (inward receipts) for which the person has paid VAT are related to the economic activity carried out by that person and are intended for subsequent taxable supplies (outward sales). In most cases the right to deduct tax credit is rejected exactly due to the lack of these preconditions (for example, when the goods or services received are for personal use or exempt supplies).
When, for a given tax period, the amount of “input” VAT exceeds the amount of “output” VAT, a tax refund arises. This tax is not refunded immediately, but pursuant to Article 92 of the VAT Act, it is first offset against the person’s liabilities under the VAT Act for the next three consecutive tax periods.
If, after the expiry of these three periods, there is still unpaid tax to be refunded, then, pursuant to Article 93 of the VAT Act, it becomes subject to actual refund. In this case, the revenue authority initiates an audit.
As part of this check the revenue authority has the right to request additional information from the liable person (for example, copies of invoices, credit / debit notes thereto, written explanations, etc.). As a result of the check it is found whether the registered person has a valid right to receive VAT refund.
| For more information | |
 | In this respect it is important to know that, if there are liabilities related to outstanding public payables due by your company as at the time of the check, these liabilities will be offset against the VAT that is subject to refund. |
The VAT refund is made to a bank account set out by the registered person. In most cases this occurs after completion of the audit initiated in relation to the VAT refund.
| Important to know | |
| More information regarding the VAT reporting and refund is available on the website of the NRA. |
VAT on supplies to non-taxable persons in the EU
When a Bulgarian company supplies goods and services for which recipients are tax-free (individuals) from another EU Member State, the supplier company is obliged to charge VAT according to the rules and rates in the respective Member State where these consumers are established. (Member State of consumption). This also applies to the supply of the following goods and services:
- supply of telecommunications services, radio and television broadcasting services and services provided electronically;
- supply of services which have a place of performance in another Member State;
- intra-Community distance sales of goods with a place of performance in the territory of another Member State, ie electronic sale of goods to another Member State.
The provisions related to these supplies require the Bulgarian company to register and file a VAT return in each Member State where it makes supplies to non-taxable persons or to register under a special regime in Bulgaria that allows VAT to be declared and paid for all supplies in the EU in one place.
If the total value, VAT excluded, of the supply of telecommunications services, radio- and television broadcasting and electronic services and of intra-Community distance sales of goods to non-taxable persons does not exceed the threshold of EUR 10,000, the supplier may choose to tax these supplies according to the Bulgarian legislation.
You can read more about VAT on sales in the EU to non-taxable persons on the NRA website.
[*] From 1 January 2026 onwards, the equivalent value in euros, calculated using the official exchange rate, shall apply.