Bulgaria Tax On Expenses : minfin.bg

Organization : Ministry of Finance
Facility : Tax on Expenses
Country : Bulgaria
Website : https://www.minfin.bg/en/776

What is Bulgaria Tax On Expenses?

The tax on expenses is regulated in Articles 204-217 of the Corporate Income Tax Act (CITA). Any expenses associated with the use of own assets, leased assets or assets provided for use, provided for personal use and/or associated with the use of staff, shall not be expenses in kind, where remuneration is due for their use.

Related / Similar Facility : Bulgaria Tax On Vessels Operation Activity

Exemptions of Bulgaria Tax On Expenses

1. No tax shall be levied on any expenses on contributions and premiums for supplementary social insurance and life assurance not exceeding the amount of BGN 60 per month per hired person, where the taxable persons do not incur any coercively enforceable public obligations, i.e. where at the end of the month in which the expenses are charged, the liabilities have not been listed in the tax and social insurance account or are not listed as filed for coercive enforcement in the National Revenue Agency.

2. No tax shall be levied on any expenses on food vouchers in paper form and on an electronic medium not exceeding the amount of BGN 200 per month, provided in the form of food vouchers to each hired person, where the following conditions are simultaneously fulfilled:
** the agreed basic monthly remuneration of the person in the month of provision of the vouchers is not lower than the average monthly agreed basic remuneration of the said person for the previous three months;
** at the end of the month in which the food voucher expenses are charged, the taxable person does not have any coercively enforceable public obligations, i.e. the liabilities have not been listed in the tax and social insurance account or are not listed as filed for coercive enforcement in the National Revenue Agency;
** the vouchers are provided to the taxable person by a person who has obtained authorization to carry on business as an operator by the Minister of Finance.

Taxable Persons of Bulgaria Tax On Expenses

** Taxable persons in respect of the tax on any business entertainment expenses shall be the persons who are subject to levy of corporation tax.
** Taxable persons in respect of the tax on any expenses on fringe benefits provided in kind to workers and employees and to persons hired under a management and control contracts shall be all employers or commissioning entities under management and control contracts.
** Taxable persons in respect of the tax on the expenses in kind associated with own assets, leased assets and/or assets provided for use are all employers or commissioning entities under management and control contracts or under legal relationships for performance of work in person within the meaning given by item 26 (i) of § 1 of the Supplementary Provisions of the Income Taxes on Natural Persons Act.

Taxable Amount of Bulgaria Tax On Expenses

** Taxable Amount for Tax on Entertainment Expenses
** The taxable amount for the assessment of the tax on business entertainment expenses shall be the expenses charged for the calendar year.
** Taxable Amount for Tax on Fringe Benefit Expenses Provided in Kind
** The taxable amount for assessment of the tax on these expenses shall be the expenses on fringe benefits provided in kind debited with the income related to the said expenses for the calendar year.
** Taxable Amount for Tax on Fringe Benefit Expenses on Contributions (Premiums) for Supplementary Social Insurance and Life Assurance
** The taxable amount for assessment of the tax on these expenses shall be the excess of the said expenses over BGN 60 per month per hired person.
** Where the condition in Article 208 CITA for receiving the tax exemption is not fulfilled, the taxable amount for assessment of the tax on expenses shall be the full amount of the expenses charged for the calendar month.
** The tax base for the assessment of the tax on expenses referred to in the previous two sentences shall be the sum of the tax bases for the months of the calendar year.

Tax Rate of Bulgaria Tax On Expenses

The tax rate on business entertainment expenses and expenses on fringe benefits provided in kind shall be 10 per cent. The tax rate on the expenses in kind associated with own assets, leased assets and/or assets provided for use, provided for personal use and/or associated with use of staff, by factory workers, office workers and persons hired under management and control contracts (hired persons), as well as by persons performing work in person is 3 per cent.