The Local Taxes and Fees Act (LTFA) regulates the regime for taxation with property taxes and fees in Bulgaria.

Here is a brief overview of the main property taxes and fees in Bulgaria.

REAL ESTATE TAX

With real estate tax are levied the located on the territory of the country buildings and real estates in regulation.

Agricultural lands are not levied, with the exception of built-up land – the actual built-up area and the adjacent terrain.

The taxable persons are the owners of taxable corporeal immovables. Should a right in rem to use have been created, the user shall be the taxable person. Where the right of ownership or the limited right in rem to use a taxable immovable property vests in several persons, liability for tax shall apply to the said persons in proportion to the parts thereto appertaining.

The rate of tax on real estate tax is from 0,1 to 4,5 per thousand of the tax assessment of the property and is determined by the municipal administration according to the location of the property.

The owner of any newly constructed buildings and structures, which are not subject to commissioning according to the procedure established by the Spatial Development Act, shall notify the municipality exercising competence over the situs of the property within two months after the said construction by submission of a tax return for annual immovable property taxation.

Tax returns for annual immovable property taxation shall not be submitted for any properties acquired by donation, as well as on any onerously acquired corporeal immovables and limited rights in rem. The registry offices notify the municipality concerned within seven days of any transferred, created, modified or terminated rights in rem to immovable properties.

The tax is assessed on the tax assessment of the real estate.

Tax assessment of real estate of citizens is determined by the municipal administration by set for this purpose norms depending on the type, location, size, construction and the wearing out of the property.

Tax assessment of real estate of enterprises is higher between book value and tax value determined by the municipal administration, accordingly.

The tax is paid regardless of whether the property is used or not.

Under certain conditions, some properties specified in the law are remitted from paying real estate tax.

For a property, which is a main residence, tax is due by 50 per cent decrease.

Real estate tax is paid in two equal installments within the following deadlines: by June 30 and by October 31 of the year for which it is due.

For those who paid by April 30 of the year there is a discount of 5 percent.

GARBAGE FEE (HOUSEHOLD WASTE FEE)

The fee is paid for the services of collection, transportation and disposal in landfills or other facilities of household waste, and for maintaining cleanliness of the territories for public use in populated areas.

The fee is determined in an annual amount for each settlement with a decision of the municipal administration according to the location of the property.

According to the law, the amount of the household waste fee shall be determined mainly on the basis of the quantity of household waste. However, in cases where municipalities cannot calculate the amount of garbage formed (as the current practice), municipalities use the alternative version in which the fee is determined based on the tax assessment of property owned.

For example, household waste fee for real estates owned by citizens and for residential property owned by enterprises set by the municipality of Sofia for 2019 is 1.6 per thousand of the tax assessment of the property located in the municipality.

The household waste fee is paid in four equal installments within the following deadlines: by April 30, by June 30, by September 30 and by November 30 of the year for which it is due.

There is no fee for waste collection and disposal, when the municipality does not provide the service or if the property is not used throughout the year and is submitted a declaration form by the owner or user by the end of the previous year in the municipality where the property is located.

TAX ON VEHICLES

With a tax on vehicles are taxed vehicles registered for use on the road network in the Republic of Bulgaria.

The amount of the tax is determined by the municipal administration where the vehicle is registered.

Owners of vehicles pay the tax.

Exempt from taxation are electric cars, motorcycles and mopeds.

In respect of passenger cars and commercial vehicles having a technically permissible maximum mass not exceeding 3.5 tonnes, the annual tax consists of two components: a property component and an environmental component. The property component is set on the basis of the value of the tax depending on the engine power adjusted by a coefficient depending on the year of manufacture of the motor vehicle. The environmental component is set by the Municipal Council depending on the emission category of the motor vehicle.

A rate rebate of 20 per cent applies to the tax on buses, commercial vehicles having a technically permissible maximum mass not exceeding 3.5 tonnes, trailer tractors and truck tractors equipped with engines conforming to emission category Euro 4, and a rate rebate of 50 per cent shall apply to the tax so arrived at on such vehicles conforming to emission categories Euro 5, Euro 6 and EEV.

The tax on vehicles is paid in two equal installments within the following deadlines: by June 30 and by October 31 of the year for which it is due.

Those who had paid by April 30 of the year there is a discount of 5 percent.

Upon transfer of ownership of a transport vehicle, the new owner shall not pay the tax should the previous owner have paid the said tax for the time remaining until the end of the calendar year (wherein the transfer was effected).

Payment of the tax is a condition for conformity upon the periodic technical inspection of the transport vehicle.

For more information or legal assistance in conjunction with the property taxes and fees in Bulgaria please do not hesitate to contact us by e-mail: office@kgmp-legal.com or call us on: +359 2 851 72 59.


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