Starting a business in Bulgaria

Public body: Ministry of Economy

Address: ul. "Slavyanska" 8, Sofia 1052
Phone: +35929407001
Website: https://mi.government.bg/en/

The two most popular types of business entities in Bulgaria are Sole Proprietor (SP) also known as self-employed and Sole owner of limited liability company. Below we review the advantages and disadvantages of self-employed.

The basics

The sole proprietor is an individual, who falls in the self-employed category and as such she/he is obliged to pay social security, health insurance, and taxes.

Patent tax would be applicable to the income arising from certain business activities. For example, carpentry, knitting, shoemaking, hairdressers, typewriting, beautician, watchmaker, upholstery, car repairs, car washes. If the SP carries out an activity from the above list, she/he owes patent tax when the next two conditions are also met: her/his turnover in the preceding year does not exceed 50,000 BGN and she/he is not registered for Value Added Tax.

Advantages

This is the simplest legal form, as there is no capital requirement. Winding-up (dissolving) procedure for a sole proprietor is also relatively simple.

Disadvantages

The sole proprietor is liable to creditors without limitation. This is including all of their personal assets. The sole proprietor shall pay social security, health insurance, and taxes at the year-end.

Register as self-employed

Any individual with permanent residence in the country may register as a sole proprietor. The main exception is if the individual has undergone bankruptcy proceedings or has been sentenced for bankruptcy, or if she/he was a manager of a company terminated due to bankruptcy. Such individuals cannot carry out activities as a sole proprietor.

  1. A person who would like to register as sole proprietor shall declare the absence of the above circumstances by providing a statement that is attached to the registration application.
  2. Files the application with the Registry Agency. In addition, the application may be filed on-site at the reception desk at the Registry Agency or online on the website of the Registry Agency. An electronic signature (QES) is required for online application.
  3. Pays a fee due to the Registry Agency upon the filing of the application. The amount is 30 BGN when filing the application on-site and 15 BGN when filing the application electronically.
  4. Chooses a name under which the sole proprietor will be entered in the Commercial Register. The name should contain the first and family or middle name of the natural person without abbreviation.

Application for registration is available on request (email Hello(at)move2bulgaria.com for form А1).