What Are Food Vouchers
Food vouchers are monetary value documents (in paper or electronic form) that entitle the holder to receive food and food products at participating retail outlets. They are provided by employers to employees through a licensed operator under the procedure established by Ordinance No. 7 on food voucher operator activities.
The legal framework is found in Art. 204(1)(2)(b) and Art. 209–209a of CITA, as well as Art. 24(2)(1)(e) of PITA.
Tax Advantages
| Aspect | Without vouchers (cash bonus) | With food vouchers (within limit) |
|---|---|---|
| Income tax (PITA) | 10% | 0% |
| Social security (employee) | ~13.78% | 0% |
| Social security (employer) | ~18.92% | 0% |
| Tax on expenses (CITA) | Not applicable | 0% (when conditions are met) |
| Deductible expense for employer | Yes (salary) | Yes (social expense) |
| Effective employer cost for EUR 100 net | ≈ EUR 148 | EUR 100 |
Example: If an employer wishes to provide an additional EUR 100 net to an employee, a cash bonus would incur social security contributions and income tax — the total cost would be approximately EUR 148. With a food voucher within the limit, the cost is exactly EUR 100, with no additional charges.
Conditions for Tax Exemption (Art. 209a CITA)
For food vouchers to be exempt from the tax on expenses, all of the following conditions must be met cumulatively:
1. Limit — Up to BGN 200 (≈ EUR 100) Per Month Per Employee
The value of food vouchers must not exceed BGN 200 per month (approximately EUR 100) for each employed person (Art. 209a(1)(1) CITA).
2. For All Employees
Vouchers must be provided to all employed persons — workers, employees and persons engaged under management and control contracts (managers). Selective provision to only certain categories is not permitted (Art. 209a(1)(2) CITA).
Important: Employees may receive different nominal values (e.g., EUR 80 and EUR 100), but all must have access to the benefit.
3. Through a Licensed Operator
Vouchers must be purchased from an operator that has received authorization from the Minister of Finance under Ordinance No. 7 (Art. 209a(1)(3) CITA).
4. Provision in Kind
Social benefits, including food vouchers, must be provided in kind — i.e., not in cash. Paying the cash equivalent instead of the actual vouchers does not meet this requirement.
5. No Outstanding Public Liabilities
At the time of providing the vouchers, the employer must not have any public liabilities (taxes, social security contributions, fines) subject to enforcement (Art. 209a(1)(3)(b) CITA).
What Happens When the Limit Is Exceeded
Tax on Expenses — 10%
If the value of food vouchers exceeds BGN 200 per month per employee, the excess is subject to tax on expenses at a rate of 10% (Art. 204(1)(2), ref. Art. 216 CITA).
Example: If an employee receives food vouchers worth BGN 350 for the month, BGN 200 is tax-exempt. The excess of BGN 150 is subject to tax on expenses: 150 × 10% = BGN 15 tax.
If Conditions Are Not Met at All
If the vouchers do not meet the conditions of Art. 209a (e.g., not provided to all employees, or the employer has outstanding public liabilities), the entire amount (not just the excess) is subject to the 10% tax on expenses.
Income Tax (PITA)
Food vouchers provided in compliance with Art. 209a CITA are not included in taxable income under Art. 24(2)(1)(e) PITA — even if the total value exceeds BGN 200 (e.g., when an individual works for more than one employer). Each employer applies the BGN 200 limit independently.
Food Voucher Operators
Food vouchers may only be purchased from licensed operators authorized by the Minister of Finance. The main operators in Bulgaria are:
- Sodexo — part of the international Pluxee group.
- Edenred — international operator, market leader.
- Tombou — Bulgarian operator.
Operators issue vouchers in paper or electronic form (electronic cards). The employer enters into a contract with the operator, pays the nominal value of the vouchers and receives the corresponding number of vouchers or electronic top-ups.
Procedure for Employers
Step 1: Decision to Provide
The employer adopts an internal act (order, decision, amendment to the internal remuneration rules or collective agreement) specifying:
- the value of food vouchers (up to BGN 200/month);
- that the benefit is for all employed persons;
- the operator from which the vouchers will be purchased.
Step 2: Contract with Operator
A contract is concluded with a licensed operator. The operator issues an invoice for the nominal value of the vouchers + a service commission (typically 1–3% of the nominal value).
Step 3: Distribution of Vouchers
Vouchers are provided to employees monthly, against signature or through electronic card top-ups. Records are maintained for the vouchers distributed.
Step 4: Accounting Treatment
Food voucher expenses are recorded as social expenses in kind and debited to the social expenses account. They are a deductible expense for tax purposes and reduce taxable profit.
Step 5: Declaration
The tax on expenses (if applicable — when the limit is exceeded or conditions are not met) is declared in the annual tax return under Art. 92 CITA and paid by 30 June of the following year.
Social Security Aspects
Within the Limit (BGN 200)
The value of food vouchers up to BGN 200 per month is not included in the employee’s insurable income. The following contributions are not due:
- mandatory social security contributions (SSC);
- supplementary mandatory pension insurance contributions;
- health insurance contributions.
Above the Limit
When the BGN 200 monthly limit is exceeded, the excess is treated as a social expense subject to the tax on expenses. Social security contributions are not due on this amount if the employer has elected to tax it under Art. 204 CITA.
Employment with Multiple Employers
According to NRA Clarification No. 53-00-108 of 04.06.2024, if a person works for two or more employers and each provides food vouchers up to BGN 200, each employer applies the limit independently. The employee may receive more than BGN 200 in total per month, without any employer owing tax or social security contributions.
Frequently Asked Questions
Conclusion
Food vouchers remain one of the most tax-efficient employee benefits in Bulgaria. When the conditions under Art. 209a CITA are met — the BGN 200 limit, provision to all employees, through a licensed operator, and in kind — no income tax, social security contributions, or tax on expenses are due.
If you need assistance with structuring employee benefits or have questions about the tax treatment of food vouchers, the team at Innovires Legal can help. Contact us for a consultation.
This article is for informational purposes only and does not constitute legal advice. For specific questions regarding the tax treatment of food vouchers in Bulgaria, please consult a qualified professional.
Need assistance?
The Innovires team can assist you with tax planning and employee benefits — from food vouchers to comprehensive compensation structuring.