VAT charging and tax rates

Responsibility for charging VAT

Any person registered under the Bulgarian Value Added Tax Act (VATA) is obliged to charge value added tax and issue a tax document, such as an invoice, protocol or notice with the VAT amount indicated on a separate line. The document needs to be added to the purchase ledger for the relevant period in the VAT declaration issued in accordance to Art. 86 of VATA. If a document is not issued in the required period, the VAT is due for the period when the tax becomes chargeable.

There is no tax charged for cases of exempt intra-EU acquisition and exempt supply and when the transaction is not on Bulgarian territory (see Art.86 (3) of VATA).

VAT payers

The payer of the VAT is the supplier, except in the following cases:

  • When the supplier is a taxable person but not located in the country of the supply, when the tax is chargeable to the recipient of the supplies included in Art. 82 (1) of VATA including: natural gas or supplies which are assembled or installed.
  • The recipient of the supply is chargeable for the tax in cases of triangular operations as defined by Art.82 (3) of VATA.
  • When the supply is of gold or other gold material, the recipient is chargeable for the tax (Art. 82(4) of VATA.
  • Art. 163 defines when the recipient is VAT chargeable no matter whether the supplier is liable to tax or not (Art.82 (5) of VATA).

The importer is charged with the tax as a general rule.

For acquisitions within the EU, the tax is charged to the person who is carrying out the acquisition as stipulated in Art.84 of VATA.

Tax charging

The tax under the VATA becomes due on the date of the chargeable event as specified in Art.25 of VATA.  This is the date when the registered person becomes obliged to charge tax, or when they can become exempt in the cases of exempt supplies outside Bulgaria.

In the cases when a full or a partial advance payment is done prior to the chargeable event, the tax is charged as soon as the full payment is made (with the exclusion of any payments done for intra-EU supplies).

If the recipient of the payment is still unregistered in accordance with VATA and receives an advance payment, but becomes registered by the time of the chargeable event and the full payment, then VAT is charged for this supply of goods or services.

In case of periodic, continuous or phased supplies, the chargeable event occurs at the end of the calendar year or on the date of the last supply within the calendar year.

  1. For intra-EU community supplies

In accordance with the requirements in Art. 51(3 and 5) of VATA, in the cases when an advance payment is made for an intra-EU supply, the supply becomes chargeable on the 15th day of the month following the chargeable event.

According to Art. 51 (4) of VATA, the tax for intra-EU supplies becomes chargeable at the date of the issuance of the invoice or other tax document in accordance to Art.168, paragraph 8 in the case when the invoice is issued prior to the 15th of the next month after the chargeable event.

  1. For intra-EU purchases of goods

According to Art.63 (3 and 5) of VATA, when an advance payment is made for an intra-community acquisition, the tax becomes chargeable on the 15th day of the following month.

In accordance to Art. 63 (4) of VATA, the tax is chargeable at the date of the issuance of the invoice in the cases when the document is issued prior to the 15th day of the month following the transaction.

VAT on intra-EU purchases is charged to the person performing the acquisition.

Tax rates and amounts

The tax rates are defined in Art. 66 of VATA and are as follows:

The standard 20% rate for the VAT is applicable to all taxable supplies with the exception of those specified as having zero rate, the import of goods in the country, the taxable intra-EU acquisitions.

The tax which is charged for hotel, vacation accommodation or camping site leases is 9%.

The amount of the VAT is derived by multiplying the chargeable amount by the tax rate percentage (Art.67 of VATA).

Tax and net tax payment period

According to Art.87 of VATA, the tax period is the time between the submission of VAT return by the registered person for the net tax for the period reported. This period is fixed at one month for all registered people and entities with the exception of the cases stipulated in chapter 18 of VATA.

The net tax for the period equals the difference between the total chargeable tax and the total amount of tax credit for that period for which tax deduction can be made.

 

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