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Hidden Costs of Running a Business in Bulgaria | 2025 Guide for Entrepreneurs
Many entrepreneurs are attracted to the country’s low corporate tax of 10% and dividend tax of 5%. However, beyond these advantages lie important hidden costs that every business owner should understand before starting operations.
Social Security Contributions
Even if you are the sole owner and actively working in your company, you must contribute to the social security system. In 2025, the minimum monthly contributions range from 220 to 300 BGN, depending on the income base you declare. If you decide on a higher income base, your contributions will increase accordingly. This is a mandatory cost for every entrepreneur, whether paid as a self-insured person or through a management contract.
Annual Accounting and Compliance Costs
Every company in Bulgaria must prepare and submit annual financial statements, even if there is no activity during the year. You will also need regular accounting services for:
- Monthly VAT declarations (if registered)
- Payroll and employee-related reporting
- Preparation and filing of the annual corporate tax return
Accounting service fees vary, but entrepreneurs should realistically budget at least 2,000–4,000 BGN per year. Skipping proper accounting can result in penalties that far exceed the savings from cutting costs.
Mandatory Audits for Growing Companies
Once your company reaches specific thresholds, such as:
- Turnover above 4 million BGN
- Total assets exceeding 2 million BGN
- Average of 50 employees during the year
it becomes subject to a statutory independent audit. These audits are carried out by certified auditors and can cost several thousand leva annually. For growing companies, this is an important expense to factor into financial planning.
Administrative and Hidden Fees
Besides taxes and accounting, business owners encounter regular administrative charges. Examples include:
| Expense Type | Typical Cost (BGN) |
|---|---|
| Bank account monthly fees | 10–30 |
| Government filing fees (Commercial Register) | 30–200 |
| Notarization and certifications | 50–300 |
| Translations of official documents | 20–50 per page |
| Company detail changes | State fee + notary + professional fee |
Individually these may seem small, but over a year they represent a significant hidden cost for business owners.
Unexpected Penalties and Compliance Risks
Bulgaria has strict deadlines for tax and reporting obligations. Missing them can result in costly fines. For example:
- Late VAT return – fines starting from 500 BGN
- Failure to publish annual financial statements – penalties from 2,000 BGN
Staying compliant is not only a legal requirement but also protects your business from unnecessary financial risks.
Plan Beyond the Tax Advantages
Bulgaria remains one of the most cost-effective EU countries to start and grow a business. The low corporate and dividend taxes are major incentives, but entrepreneurs should prepare for the additional hidden costs that come with compliance, social security, and administration. By planning ahead, you can protect your business from unpleasant surprises and create a solid foundation for sustainable growth.
ASB Accounting Services Bulgaria is here to help you navigate these requirements with confidence and peace of mind.