Because of the fact, that Bulgaria is a European Union member and a member of the European Economic Area, our legislation in the field of VAT is comparatively unified. Despite the ambition of EU institutions for harmonization, however there are certain regional differences between the member countries.
The tax rate in Bulgaria, generally, is 20% on the purchase made. There are exceptions to this general rule, by dint of the provisions of article 22 of the law on a value-added tax – Bulgaria’s VAT Law (A tax rate Article 66. (1) The rate of the above-mentioned tax is 20%/twenty percent on: 1. taxable deliveries, except the ones explicitly stipulated as leviable with a zero rate; 2. the import of commodities on the territory of our country; 3. taxable intra-Community acquisitions. (2) (An amendment made – please, see Official Gazette, issue 94 of year 2010, in force from 01.04.2011, another amendment made – please, see Bulgaria’s Official Gazette, issue 99 of year 2011, in force from 01.01.2012). The tax rate on the accommodation, provided at hotels and similar establishments, including the provision of vacation accommodation and on the granting for rent of places, intended for camping sites or caravans, is to the amount of 9 percent.)
In order to be able to refund the margin between the purchases made, inclusive of VAT and the sales made with VAT, whenever the paid tax-VAT on purchases is bigger than the VAT paid on sales, the person liable for tax must have VAT registration.
Bulgaria’s NRA (National Revenue Agency) keeps a special register of the persons registered under VAT Law. ) Upon their entry into the above-mentioned register, persons get an identification number for the purposes of VAT, before which the sign “BG” is placed (Most often, it is the UIC number of the companies, under which they are recorded in the Commercial register/Companies House, with BG in front of it, whenever a legal person is registered under VAT Law). The cases of registration under Bulgaria’s VAT Law can be divided into the following kinds:
1. Voluntary registration. First of all, in order to be registered voluntarily, a person should not be liable to compulsory registration under VAT Law. In the second place, a person should file an application, using a form, with NRA. The registration under Bulgaria’s VAT Law will be carried out in a 2-week period, considered from the date of filing the application and after the fulfillment of all requirements set by NRA (after submitting the registration application under VAT law, the person liable for tax gets “Request for the presentation of documents” from NRA, to which one must reply within a 7-day period. After submitting a full list of the documents stipulated in the above-stated “Request”, within a 7-day period, the person liable for tax gets also its registration under VAT Law. The deadlines for filing documents with NRA are preclusive/mandatory and after their expiration, if the instructions given by NRA are not carried out accurately, a refusal of registration follows. The deadline for getting registration under VAT Law is instructive and the tax body may not meet it accurately.) The voluntary registration under VAT Law is most often accomplished/brought to completion by persons, who make purchases inclusive of VAT and would like to avail themselves of tax credit. They can be entrepreneurs under investment projects, the owners of development activity and so on.
2. Compulsory registration. Basically, it can be divided into the following types:
◌ Whenever a person liable for tax reaches a taxable turnover of the sales made to the amount of 50 000 Bulgarian levs (1 euro = 1,95583 Bulgarian levs) for a period not longer than 12 consecutive calendar months.
◌ Whenever a person liable for tax performs specific kinds of activities, the registration is obligatory with a view to the business activity. Such lines of business are: the deliveries of commodities with assembly and installation, whenever the person is established on the territory of a EU member country and is not ascertained on the territory of our country; There is obligation for registration in case of the provision of services, the tax on which is required by the recipient; There is also an obligation for registration before the performance of telecommunications services, services for radio- and television broadcasting or services, done electronically; the remote sale of commodities; at the moment of intra-Community acquisition;
◌ Registration on the initiative of a tax body. Whenever the revenue body establishes, that a person did not fulfill in time one’s obligation to file a registration application, then a tax official registers it with the issue of a public act of registration, if the conditions for registration are available.