You got a flat at the local Spa, or just plan to purchase? In this case, you will have to face with the Bulgarian tax legislation. On tax on property in Bulgaria for Russians and CIS citizens, current rates and method of calculation read in this article.
Annual property tax
According to Bulgarian law, a tax is imposed on all properties on the territory of Bulgaria. With the exception of farmland and forests.
A foreign citizen who buys in Bulgaria house or apartment, automatically becomes the payer of property tax. Not later than 60 days after certification of the contract of sale at the notary, the new owner must register with the tax office by submitting a Declaration about the object.
Declaration of a residential facility contains a full description:
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Year of purchase/construction. |
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Basic building materials. |
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Structural features of the object. |
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The surface of the building premises. |
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The number of storeys. |
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Cadastral (estimated) value of the object. |
Property tax in 2017, both for Russians and other foreigners and citizens of Bulgaria, is 0.15% of the cadastral value of the object. Estimated or cadastral value of the object is set by the tax authorities and, as a rule, 50-70% below the market.
For legal entities, property tax is calculated at the rate of 0.15%, based on the carrying value of the property .
The real estate tax based on the assessed value of residential property. Rate relevant to physical and legal entities.
In addition to the nationwide, owner pays municipal tax, which is essentially a fee for removal of household waste. The amount of the fee is 0.2-1% of the cadastral value of housing and is set by each municipality depending on the prestige of the area where the housing is located. In 2017, the size of the municipal fee is to:
- Varna – 0,15%;
- Sofia – 0,32%;
- Burgas – 0,25%.
Municipal fee shall be paid together with property tax is, therefore, conventionally considered to be part of it.
The rate of duty on export of household waste is the same for both individuals and for legal entities regardless of the nationality of the payer.
Payment plan
The estate tax is paid once a quarter, to the last day of each month (March, June, September, December). When you pay the entire amount before March 31, a discount of 5%.
Maintenance of real estate or maintenance fee
Luxury apartments in Bulgaria there is a fee for service areas, which includes the protection and cleaning of the building, landscaping of the surrounding area and pool cleaning. The fee is calculated depending on the size of the apartment and ranges from 5 to 15 euros per month.
The maintenance fee is set, usually in residential complexes, resort-style and apartment hotels, offering guests additional amenities (pool, reception, security guard, recreation, restaurant, etc.). In apartment houses and some complexes maintenance fee is missing.
Read also the article:
Taxes on income from the sale and rental of real estate
Rent. According to the Bulgarian legislation, the landlord must pay income tax at the rate of 10% and VAT of 9% with the resulting rental income. Of taxable the amount of permitted deductions in the amount of expenses incurred by the lessor in providing the service. To obtain permission for the deduction, the expenses must be documented.
The tax is paid monthly or once during the reporting period. The procedure for obtaining permission for leasing of rental properties and peculiarities of payment of tax on the rent, it is possible to specify in the tax office or the management company.
Also the owner of a residential facility must carry out a lump sum in the amount of 5 BGN for each bed.
Read our article:
Sale. The seller has to pay tax on capital gains in the amount of 10% of the difference between the purchase price and the selling price of a residential facility.
From tax on capital gains exempt the following categories of owners:
- selling primary residence and owned it for more than 3 years;
- sell no more than 2 objects in the ownership of more than 5 years.
Important: ifand you sell the property from the legal entity and its value exceeds BGN 50 000, you automatically become a VAT payer. In this case, a tax of 20% is levied on amounts in excess of 50 000 thousand BGN. You also pay a value added tax, when buying property from the developer at the primary market, however, this amount is usually already included in the purchase price.
Find out more about how to sell property in Bulgaria.
About other types of taxes in Bulgaria will tell in a separate article.
