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Bulgaria Freelance Taxes: Detailed Breakdown

dmitryfrank.com

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Re: Bulgaria Freelance Taxes: Detailed Breakdown

#41

Post by phoronixrly »

ostenning wrote: post #40
phoronixrly wrote: post #9

Keep in mind that Bulgaria has just elected a reformist parliament for the first time in more than 10 years. Maybe wait a year or two before buying a one-way ticket as the government may raise taxes, especially on the unaffected by the anti-COVID measures. Or they could lower taxes even more if they manage to get on top of the rampant tax evasion and grey economy (one can hope). Also there are other small things to c…

On the plus side Bulgarian food is excellent

Ah yes, sorry for the negativity above. Just wanted to point out that moving here should be a well thought out decision and preferably not based on a single not-entirely-correct HN post. There are trade-offs and there's more to a country and to life than low taxes...

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#43

Post by lukasm »

cromka wrote: post #27
lukasm wrote: post #22

Earlier quoted context omitted.

If you are a "creative" person (software engineer, designer etc.) you can just pay a flat rate for all taxes and insurance. For example: 100k revenue will equal to 12k in income tax + medical insurance + social security. In total, it would be less than 20k (17-20% depending on a few factors). Another option would be to use IP BOX relief. If you are producing IP your tax will be 5%. If you fly to a customer, have a co…

Thanks, much appreciated!

you have to decide what kind of taxation scheme you have to you after your first invoice. It's for the whole year. You can change it next year.

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#44

Post by Hokusai »

jstx1 wrote: post #24

> And if your income is smaller than 710 BGN, even if it's straight zero, then you'll have to pay social security as if your income was 710 BGN Is this really how it works? They're taxing people with 0 income? I guess it isn't relevant to the target audience of the article but it must suck for the unemployed. > Accountant fees: about 150 - 200 BGN per month independently of the income. This seems really high. Why do…

In Spain for self employed workers there is also a minimum. If you do not want to pay it you need to unregister.

This does not apply for employees. It's just for self employed workers as it's more of a fee for the paperwork that you generate for the government than a tax on income.

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#45

Post by galfarragem »

firechickenbird wrote: post #7

Considering moving in Bulgaria after this, thanks! My Freelance taxes/social sec/retirement tax in Italy is on average 76% on a total of 80k eur average gross annual income (98th income percentile).

Maybe is just me but paying 76% taxes is dystopic. The economics of slavery are not that far.

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#46

Post by atxbcp »

The numbers in this article are wrong, especially the company vs individual chart: you'd only pay 16% tax with a company if you paid yourself in dividends. Past a certain threshold, with a company, the best option is to pay yourself a salary every month. Then your tax rate will be in the 11 - 15% range depending on your income.

source: I've got a company in Bulgaria

conclusion: coming to Bulgaria to pay less taxes can definitely be done, but hire a local accountant and get professional advice.

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#47

Post by gcbirzan »

phoronixrly wrote: post #39
gcbirzan wrote: post #25

Earlier quoted context omitted.

If by those unaffected by COVID you mean self-employed people, not sure that's really the case, as taxes for people that are employed by a Bulgarian company are not THAT much higher. Using the 10k BGN example, your net salary is 8627.94, and the employer (of course, excluding accounting and all that stuff) pays 10567.60. I don't remember exactly the numbers for self employed, but if his are correct (and they seem a b…

The plans are to raise the maximal social security income (“максимален осигурителен доход”). This will arguably* disproportionately affect people with incomes above 3000 BGN. *) Arguably because (while they could easily afford to pay more tax) higher income employees usually get taxed on their actual amount of income as opposed by the rampant tax evasion among employees with lower pay and their employers (so called g…

Didn't they raise it? To be fair, I've always thought it's way too low.

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#48

Post by SantiagoElf »

Bulgarian here. :)

We like to be hush-hush about the benefits of living in Bulgaria.

Nothing at the moment beats the taxes, location and potential of Bulgaria in Eastern Europe :)

You can ask me any questions related to living cost, places, customs, etc or anything related to Bulgaria.

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#49

Post by [deleted] »

phoronixrly wrote: post #34
jstx1 wrote: post #24

> And if your income is smaller than 710 BGN, even if it's straight zero, then you'll have to pay social security as if your income was 710 BGN Is this really how it works? They're taxing people with 0 income? I guess it isn't relevant to the target audience of the article but it must suck for the unemployed. > Accountant fees: about 150 - 200 BGN per month independently of the income. This seems really high. Why do…

> In either case (company or individual), due to our line of business, most likely you'll also need to do the VAT registration. It's something like 150 - 200 BGN. The VAT registration requires monthly declarations of VAT. Tracking your VAT takes time for the accountants as they need to summarize all your invoices, expenses, and other paperwork. Links (conveniently only available in Bulgarian): * VAT form: https://nra…

[deleted]

Re: Bulgaria Freelance Taxes: Detailed Breakdown

#50

Post by xondono »

Hokusai wrote: post #44
jstx1 wrote: post #24

> And if your income is smaller than 710 BGN, even if it's straight zero, then you'll have to pay social security as if your income was 710 BGN Is this really how it works? They're taxing people with 0 income? I guess it isn't relevant to the target audience of the article but it must suck for the unemployed. > Accountant fees: about 150 - 200 BGN per month independently of the income. This seems really high. Why do…

In Spain for self employed workers there is also a minimum. If you do not want to pay it you need to unregister. This does not apply for employees. It's just for self employed workers as it's more of a fee for the paperwork that you generate for the government than a tax on income.

> it's more of a fee for the paperwork that you generate for the government than a tax on income.

It’s more of a total ripoff. I do less than 20 invoices a year so 300$/month is ridiculously overpriced if it’s only supposed to cover “paperwork costs”.

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