Step one: are you a resident as a digital nomad in Bulgaria
Tax residency is not chosen and not applied for — it follows from facts. Under Art. 4(1) of the Personal Income Taxes Act (PITA), a resident individual, irrespective of nationality, is a person who satisfies at least one of four conditions: they have a permanent address in Bulgaria; they are present for more than 183 days in any 12-month period; they have been sent abroad by the Bulgarian State, its bodies or Bulgarian undertakings; or their centre of vital interests is in Bulgaria.
The difference in consequence is one of principle:
| Status | What Bulgaria taxes | Provision |
|---|---|---|
| Resident individual | Income from sources in Bulgaria and abroad | Art. 6 PITA |
| Non-resident individual | Only income from sources in Bulgaria | Art. 7 PITA |
That is precisely why the choice of structure comes second. If you remain a non-resident, a Bulgarian company or a freelance registration will change the picture, but your worldwide income stays outside the charge. If you become a resident, it comes within it — wherever the bank account happens to be.
How the days are counted, and what weighs in assessing the centre of vital interests, we deal with in eSIM and SIM cards in Bulgaria; the certification procedure is in becoming a tax resident of Bulgaria.
How this article differs from our general guide. Our tax guide for digital nomads covers the D visa, social security, banking and the practical steps of relocating. This one deals with the order in which the decisions have to be taken and with the two points that cost the most when they are taken in the wrong order: the scope of the charge, and VAT.
When both states treat you as theirs
Dual residence is not unusual among nomads — the state you are leaving often applies its own criteria and does not release you automatically. The answer is in Art. 75 PITA: where a tax treaty or another ratified, promulgated international agreement in force contains provisions differing from those of the Act, the provisions of the treaty apply.
In practice the dispute is resolved under the tie-breaker rules in the relevant treaty, not under the domestic law of either state. Which is why the ordering of the facts matters — home, family, place of activity. We deal with treaty application separately in double tax treaties.
From our practice: do not assume that leaving "automatically" terminates the old status. Check what the state you are exiting requires — in a number of jurisdictions, cessation has to be proved rather than presumed.
Step two: which structure for which income
Once the status is clear, the choice is usually between three positions. The figures below are the tax ones; social security contributions are determined under a separate regime and are payable in the first two.
| Position | Tax treatment | Provisions |
|---|---|---|
| Foreign employer, you remain a non-resident | Bulgaria taxes only income from Bulgarian sources. The employment and social security regime is determined by the law of the employer’s state and by the coordination rules. | Art. 7 PITA |
| Freelancer (liberal profession), resident | Taxable income is the revenue reduced by a 25% statutory expense allowance; the rate on the total annual tax base is 10%. The effective burden does not exceed 7.5% of gross revenue, before social security contributions are deducted. | Art. 29(1)(3) and Art. 48(1) PITA |
| EOOD | 10% corporate tax on taxable profit, plus 5% on distribution of a dividend to the owner — 15% in all on distributed profit. Undistributed profit remains taxed at 10% only. | Art. 20 CITA; Art. 38(1) in conjunction with Art. 46(3) PITA |
A few clarifications that are regularly missed. The statutory expense allowance is not evidenced — it is deducted by operation of law, irrespective of actual expenditure. For lawyers and notaries the percentage differs: 40% (Art. 29(1)(2)(d) PITA, as amended in State Gazette issue 30 of 2026, in force from 1 January 2026).
A freelancer also pays advance tax — on the difference between the taxable income and the contributions the self-insured person makes for their own account for the months of the quarter concerned (Art. 43(1) PITA). The social security side is dealt with in self-insured persons: contributions and insurable income.
Important: comparing 7.5% with 15% is misleading on its own. Under an EOOD the 15% falls due only on distributed profit; as a freelancer the tax is due on the income whether or not you draw on it. Which comes out better depends on how much you take out and how much you reinvest.
The minimum capital of an EOOD is EUR 1, and an individual share may not be smaller than one euro cent (Art. 117(1) Commercial Act, as amended in State Gazette issue 70 of 2024, in force from 1 January 2026). Entry is in the Commercial Register at the Registry Agency; the procedure itself is set out in registering an EOOD in Bulgaria. If you are still weighing the legal form, see EOOD, OOD or DPK and freelancer registration.
VAT: the two regimes have different thresholds
This is where the most expensive mistake is made at the outset, because the threshold everyone remembers is not the one that bites first.
| Ground | When it arises | Threshold |
|---|---|---|
| Art. 97a VAT Act | On receiving services with a place of supply in Bulgaria for which the tax is chargeable from the recipient, and on supplying services to taxable persons in another Member State | None |
| Art. 96(1) VAT Act | On taxable turnover exceeding the threshold for the calendar year | EUR 51,130 |
Registration under Art. 97a runs to a short deadline: the application is filed no later than 7 days before the date on which the tax on the supply becomes chargeable — that is, before the advance payment or the chargeable event (Art. 97a(4) VAT Act). A freelancer issuing their first invoice to a client in another Member State, or paying for an advertising service from an EU platform, falls within it from the first euro.
The place of supply of services to a taxable person is where the recipient has established their independent economic activity (Art. 21(2) VAT Act) — which is why the invoice to an EU client carries no Bulgarian VAT, yet the registration obligation remains. The EUR 51,130 threshold under Art. 96(1) (as amended in State Gazette issue 115 of 2025, in force from 1 January 2026) concerns full registration and comes later. More in VAT registration in Bulgaria.
Deadlines and returns
| Obligation | Deadline | Provision |
|---|---|---|
| Annual tax return — individuals | 10 January – 30 April | Art. 53 PITA |
| Annual tax return — EOOD | 1 March – 30 June | Art. 92 CITA |
| Advance tax for a freelancer | quarterly | Art. 43 PITA |
| Application for registration under Art. 97a VAT Act | no later than 7 days before chargeability | Art. 97a(4) VAT Act |
If you are between two regimes, or unsure from which date your status runs, ask us to review it — the date on which it arises is what determines which return is filed and by when.
The address where they will look for you
One obligation surprises almost everyone who manages a Bulgarian company from a distance. The registered address of management of a local legal entity is also its address for correspondence (Art. 28(1)(2) of the Tax and Social Insurance Procedure Code, TIPC), and where the legal representatives are absent from that address for more than 30 days, they authorise a person to whom communications and other acts are to be served (Art. 28(4) TIPC).
If no recipient is found at the address, the document may be deemed duly served 14 days after the notice is posted (Art. 32 TIPC) — with the appeal periods running whether or not you have seen it. The mechanism, and what the address agreement has to cover, is set out in using a coworking address as an EOOD’s registered address.
Note: give the revenue authorities an electronic address for receiving communications at the point of registration (Art. 28(2) TIPC). That is the channel that keeps working while you are abroad.
Taken together, this is the whole of the argument for reversing the usual order. A digital nomad in Bulgaria who settles the status first knows which of these obligations apply and from what date; one who starts with the structure finds out from a notice deemed served at an address nobody was watching.
A review of status and structure before the first return
We work with foreign professionals and entrepreneurs moving their activity or their presence to Bulgaria: assessing status under Art. 4 PITA on the totality of the circumstances, applying a treaty where residence is dual, choosing between a freelance registration and an EOOD against your actual pattern of income and drawings, registering for VAT on the correct ground and in time, and arranging the authorisation under Art. 28(4) TIPC for the periods you are outside the country. Describe your situation briefly and we will tell you what we think the priority is.
Frequently asked questions
If I become resident, does Bulgaria tax my foreign income?
Yes. Resident individuals are liable to tax on income from sources in Bulgaria and abroad (Art. 6 PITA). Non-resident individuals are liable only on income from sources in Bulgaria (Art. 7 PITA). Where another state also treats you as its resident, the dispute is resolved under the relevant double tax treaty, whose provisions apply in priority to the Act (Art. 75 PITA).
Freelancer or EOOD — which is better?
It depends how much of the profit you draw. As a freelancer, taxable income is reduced by a 25% statutory expense allowance (Art. 29(1)(3) PITA) and taxed at 10% (Art. 48(1) PITA) — effectively not more than 7.5% of gross revenue before social security contributions are deducted — but the tax is due whether or not you use the income. Under an EOOD, 10% is due on the profit and a further 5% only when a dividend is distributed. If you reinvest, an EOOD usually comes out better; if you draw everything, the difference narrows.
From when am I obliged to register for VAT?
There are two separate grounds. Under Art. 97a VAT Act the obligation arises with no threshold — on receiving services for which the tax is chargeable from the recipient, and on supplying services to taxable persons in another Member State. The application is filed no later than 7 days before the date on which the tax on the supply becomes chargeable (Art. 97a(4)). Separately, where taxable turnover exceeds EUR 51,130 for the calendar year, full registration under Art. 96(1) VAT Act becomes compulsory.
Must I authorise someone if I manage an EOOD from abroad?
Yes, where you are absent from the address for correspondence for more than 30 days. Art. 28(4) TIPC requires the legal representatives of legal entities and sole traders to authorise a person to whom communications and other acts are to be served. If no recipient is found at the address, the document may be deemed duly served 14 days after the notice is posted (Art. 32 TIPC), and the appeal periods run whether or not you received it.
How many days must I spend in Bulgaria to be resident?
More than 183 days in any 12-month period (Art. 4(1)(2) PITA). That is only one of four grounds, however — a permanent address and the centre of vital interests operate independently and require no presence at all. The converse is also true: a person with a permanent address in Bulgaria whose centre of vital interests is not in the country is not a resident individual (Art. 4(5) PITA).
Sources
- Personal Income Taxes Act — Art. 4, Art. 6, Art. 7, Art. 29, Art. 43, Art. 48, Art. 53 and Art. 75
- Corporate Income Tax Act — Art. 20 and Art. 92
- Value Added Tax Act — Art. 21(2), Art. 96(1) and Art. 97a
- Tax and Social Insurance Procedure Code — Art. 28 and Art. 32
- Commercial Act — Art. 117
- National Revenue Agency
- Commercial Register and Register of Non-Profit Legal Entities — Registry Agency
This material is for information only and reflects the law as at 28 July 2026. It is not legal advice on any particular matter. Social security obligations are determined under a separate regime and are not analysed in detail here.