Bulgaria Corporate Tax Guide 2026: the 10% Flat Tax Explained
Екип ФирмаБългария · reviewed by a certified expert accountant · Updated: 2026-05-31
Bulgaria is one of the most tax-efficient jurisdictions in the European Union. Here is how its corporate tax system works in 2026.
Current as of 31 May 2026. General information, not tax advice. Bulgaria joined the eurozone on 1 January 2026, so amounts are in euro.
A 10% flat corporate tax
Company profits (EOOD, OOD, AD) are taxed at a flat 10% corporate tax. There are no progressive brackets — the rate is the same regardless of profit size. This is one of the lowest corporate tax rates in the EU.
10% flat personal income tax
Personal income is also taxed at a flat 10%. For an owner-manager, this combination — low corporate tax plus low personal tax — is what makes Bulgaria attractive.
Dividend tax: 5%
When profit is distributed to the owner, a 5% final dividend tax applies.
⚠️ Note: the 2026 draft budget proposes raising the dividend tax from 5% to 10%. As of 31 May 2026 this is not yet enacted. Always check the current rate at the time of distribution.
A worked example
For a company with €50,000 taxable profit:
- Corporate tax (10%): €5,000
- Profit after tax: €45,000
- Dividend tax (5%): €2,250
- Net to the owner: €42,750
That is an effective total tax of roughly 14.5% from profit to the owner’s pocket — very competitive within the EU.
VAT
The standard VAT rate is 20%, with a reduced 9% for certain categories. Mandatory VAT registration applies above €51,130 of taxable turnover (from 2026, on a calendar-year basis). See VAT registration in Bulgaria.
Why non-residents choose Bulgaria
- Low, predictable taxes — 10% corporate, 10% personal, 5% dividend.
- Eurozone member since 2026 — no currency risk. See Bulgaria and the euro.
- Full EU market access and VAT system.
- Low setup cost and symbolic minimum capital.
Want to base your company here? See company formation in Bulgaria — we handle the whole process remotely.