Why Bulgaria?
Bulgaria is an appealing destination for business ventures due to its:
- Low Corporate Tax Rates: One of the lowest in the European Union at 10%.
- Strategic Location: Positioned in Southeastern Europe, providing easy access to both European and Asian markets.
- Skilled Workforce: A diverse and highly educated labour force available at competitive costs.
- Stable Economy: Promising GDP growth and favourable macroeconomic indicators.
- Cost-Efficiency: Lower costs of living and doing business compared to Western Europe.
Step-by-Step Guide to Setting Up a Company in Bulgaria
1. Business Structure Selection
The initial step is to choose the type of business entity. The most common types include:
- Limited Liability Company (LLC or OOD)
- Sole Shareholder Limited Liability Company (SMLLC or EOOD)
- Joint Stock Company (JSC or AD)
- Representative Office
2. Legal Procedures and Documentation
A. Contact Local Lawyers
Engage with local legal experts to prepare the necessary documentation, which includes:
- Minutes of the Shareholders Meeting: Detailed documentation of the initial shareholder meeting.
- Articles of Incorporation: The charter that governs the company.
- Affidavits: Various legal declarations by the appointed managers.
B. Deposit Capital
Open a corporate bank account and deposit the minimum required capital:
- Minimum Capital: BGN 2 (€1) for LLCs.
- Bank Certificate: Obtain a certificate proving the capital deposit.
C. Commercial Register Registration
Register your company with the Bulgarian Commercial Register. This involves:
- Submitting Articles of Association
- Resolution for Setting Up a New Company
- Notary-Certified Documents: Including consent and signature specimens of managers.
- Affidavits and Legal Declarations: Required under Bulgarian Commercial Law.
3. VAT Registration
Register for Value Added Tax (VAT) with the National Revenue Agency (NRA). VAT registration is mandatory for companies exceeding a certain turnover threshold (BGN 100,000).
4. Employment Agreement Registration
Register employment agreements with the NRA. This includes details such as:
- Employer’s Identification
- Employee’s Full Name and Personal Identification Number
- Employment Terms: Basic salary, job position, and other contractual terms.
5. Commercial Premises Registration
Register the company’s working hours and premises with the local mayor’s office, especially if involved in food production or distribution.
Advantages of Doing Business in Bulgaria
Low Taxes and Costs
Bulgaria offers the lowest corporate income taxes in Europe, along with low social insurance costs. Additionally, the cost of renting office space and real estate is significantly lower than in Western Europe.
Favorable Business Environment
The country’s alignment with EU legislation ensures a smooth and expedited company registration process. Political stability and membership in international organizations (EU, WTO, NATO) further enhance its attractiveness for investors.
Skilled and Multilingual Workforce
Bulgaria’s labour market is filled with highly skilled professionals, many of whom are multilingual, providing a competitive edge in various industries such as IT, outsourcing, and others.
Strategic Location and Infrastructure
Bulgaria’s position at the crossroads of Europe and Asia, coupled with its well-developed infrastructure and fast internet connectivity, makes it an ideal hub for international business operations.
Conclusion
Setting up a company in Bulgaria is a strategic move for those looking to expand their business operations into Europe. With its competitive tax rates, skilled workforce, and strategic location, Bulgaria offers a conducive environment for business growth. By following the outlined steps and leveraging local expertise, you can seamlessly establish a presence in this promising market.
For personalized assistance and expert guidance, contact our team. We specialize in helping entrepreneurs and investors navigate the complexities of international business and optimize their tax strategies.
