🇧🇬 Tax residency in Bulgaria

Bulgaria hits you with a flat 10% income tax rate. That's the headline. But before you book your flight, figure out if you'll owe it on everything you earn.

The main trigger for Bulgarian tax residency is simple: spend 183 days in the country within any 12-month period. It's a bright line. But it's not the only line. Bulgaria also has a "centre of vital interests" test. This means even if you spend fewer than 183 days here, you could still be considered a tax resident if Bulgaria is where your personal and economic ties are strongest. Think family, home, business, and financial interests. If your life's main hub is here, even for 100 days, you might be on the hook.

What pulls you into that "centre of vital interests" net? Owning property here is a big one. If you buy an apartment or a house, it screams "I'm staying." Same goes for having your spouse or children living here permanently. And if you’ve registered a business in Bulgaria, that’s a powerful anchor. Even if you’re only physically present for short bursts, a fully operational local company suggests your economic lifeblood flows through Bulgaria. It’s not just about where you sleep; it’s about where your life is anchored.

If you do become a tax resident, Bulgaria taxes you on your worldwide income. This isn't as scary as it sounds for most digital nomads. The 10% flat rate applies to most income types, including freelance earnings, salary, and business profits. So, if you earn €50,000 in a year, your Bulgarian income tax bill would be €5,000. If you also earn $30,000 from US clients, that income would also be subject to Bulgarian tax. The exchange rate on the day of assessment matters. For a US expat earning $30,000, at today's rate that’s roughly 55,000 BGN. The tax on that would be 5,500 BGN, or about $3,000†. It’s a straightforward calculation, but you need to declare all your global income.

Currently, Bulgaria doesn't offer a specific digital nomad visa or a special tax regime designed for remote workers that shelters worldwide income. The flat 10% rate is the regime. There are some specific deductions and allowances, mostly geared towards Bulgarian residents with local employment or specific investment types. For example, certain employer-provided benefits might be tax-exempt up to a limit. But for the typical freelance nomad, the 10% applies directly to your profit. It’s simple, yes, but there’s no special carve-out for location-independent income.

Interactions with tax treaties are key if you’re from the US, UK, or Germany. For US citizens, the US-Bulgaria double taxation treaty usually means you won't pay tax twice on the same income. You'll likely use the foreign earned income exclusion or foreign tax credits in the US to offset taxes paid in Bulgaria. The same principle applies for UK and German citizens under their respective treaties. The critical part is understanding which country has the primary right to tax your income based on where you are resident and where the income is sourced. Often, your country of residence (Bulgaria, if you meet the tests) gets the first taxing right, and your source country (e.g., the US for US client income) may offer relief. Always check the specific treaty articles.

Hiring a local accountant is often worth it once you’re earning over €2,000 a month or have income from multiple countries. They can help ensure you're not overpaying, understand all available deductions, and file your Bulgarian tax return correctly. The cost of a good accountant is usually around 600-1000 BGN per year, which is easily covered if they save you more than that by optimizing your tax situation or preventing penalties.

Triggering Bulgarian tax residency means a flat 10% on your global income.

This information is for guidance only and does not constitute legal or tax advice.