Freelancing in Bulgaria offers flexibility and control, allowing professionals to choose their clients, manage work hours, and balance life priorities. However, setting up as a freelancer requires understanding the legal requirements and establishing systems to ensure business compliance.

*Please be aware that we do not update this information in real time, so you should verify that the law has not changed recently.

 Eligibility and Permits for Freelancing in Bulgaria

To work as a freelancer in Bulgaria, all individuals must obtain a self-employment permit through the Employment Agency, which is valid for one year and requires annual renewal. This permit helps the government assess the economic impact of freelance businesses. 

- For Foreigners: Non-EU citizens also need a Type D visa from the Bulgarian embassy in their home country. After arrival, a Residence Permit must be obtained from the Migration Directorate.

 Registration Steps for Freelancers in Bulgaria

1. Submit a Business Plan and Proof of Qualifications: Applicants must present a work activity plan, proof of relevant qualifications, and a Level B1 certificate in Bulgarian language proficiency to the Employment Agency. Additionally, at least two years of related work experience and proof of sufficient financial resources are required.

2. Renewal: The above information must be submitted each year to renew the self-employment permit.

 Tax Obligations for Freelancers in Bulgaria

- Income Tax: Self-employed individuals with permanent residency in Bulgaria must pay a 10% personal income tax rate.

- VAT Requirements: Freelancers must register for VAT through the National Revenue Agency. For services rendered in Bulgaria, the standard VAT rate is 20%, but certain services or goods may qualify for reduced rates between 0% and 9%.

  - EU Clients: VAT rates vary based on client location. Tracking and correctly applying the VAT owed for each country is essential.

 Invoicing Requirements for Freelancers in Bulgaria

Freelancers in Bulgaria must provide compliant invoices for each transaction, which must be retained for at least 10 years. Each invoice should include:

- Issuance date, unique invoice number, VAT number, and addresses of both the freelancer and client.

- A description of services or goods, with quantity and unit prices for goods.

- Net taxable value, VAT rate, any exemptions, and the gross invoice total.

 Social Insurance Requirements for Freelancers in Bulgaria

Freelancers are required to pay social security contributions under Bulgaria’s Code of Social Insurance, covering health, pension, and social security:

- Insurance Contributions: Health insurance is 8% of gross income, pension insurance is 5%, and basic social security is 17.3%, totaling 30.3% of gross income. Freelancers, as self-employed individuals, must pay the full amount.

 Summary of Steps to Start Freelancing in Bulgaria

1. Obtain a self-employment permit through the Employment Agency and relevant visas if required.

2. Register for VAT with the National Revenue Agency.

3. Set up contributions to Bulgaria’s social security system.

4. Develop an invoicing system that complies with EU VAT regulations.

5. Implement a financial management system to track income and expenses.

6. Create a marketing plan tailored to your target audience and budget.

7. Organize resources and supplies needed to serve clients effectively.

This guide provides the fundamental steps and considerations for setting up a successful freelance business in Bulgaria.