Sale or registration of a company in Bulgaria
Alternatives for starting a business in Bulgaria - advantages and disadvantages
When it comes to some accounting question, the majority of people do not even make an effort to reach to their essence, and they are immediately looking for a way out of it. Sometimes, however, as much as you want to, the need for a direct collision is urgent. The only thing that we, the "Contabil" EOOD team, are able to advise you is that you have to inform yourself in advance about the specific issue so you can be confident when you act purposefully.
The fact is that not much of the information can be found on the Internet. Therefore, it is advisable to contact a company with many years of experience and with a not small number of highly qualified professionals in the accounting niche. We think that this is a sufficient first condition in order for your idea to get a starting image. From then on, it is all about making the right decisions.
Our accounting house has always strived for one thing and it is about making it easier for our clients to reach their aim without having to face significant obstacles and barriers on their way. It is absolutely no coincidence that we are renowned for such a reputation. Over the years, we have managed to win some of the top positions and we consider ourselves leaders in the field of accounting. By choosing us, you make the right decision. The many cases solved by our specialists are proof that over the years we have managed to cope with extremely diverse problems for which we have found an adequate and timely solution.
Before we move on to the essence of the issue that we consider in today's article, we feel it to be right to reveal a little more about our process of work and the mission of our accounting house. Priority for us is the problems of the citizens, whether they are Bulgarian citizens or foreigners. In no way do we take into account the ethnic origin of the client in need of competent advice, direction or help. We are committed to helping all citizens who have decided to put their trust in our accounting house, given the fact that there are hundreds of companies today and the choice is not easy.
Which is the best alternative for an EU citizen?
We, at "Contabil" EOOD, city of Ruse, work with not a small number of EU citizens and this allows us to advise you properly at a time when you need our support and services. Imagine that you are not a Bulgarian citizen and want to have a commercial activity on the territory of the country. Then what would you choose - registration of a company or purchasing a company already established?
Actually, many of the people we have been asking such a question are in difficulty and do not know exactly what to answer. We do believe that the following will be of great benefit to those who intend to start their own business outside of their homeland. We have tried to give you access, in the most descriptive and understandable way, avoiding complicated terminology, laws and sub-paragraphs, providing you with unlimited access to any important stage related to the particular topic.
If at this point you are asking yourself what to choose - establish a company or buy a company already established, do not stop reading in the lines below. We promise that after the first reading of this article you will know which option is most profitable for you and will surely step forward towards your goal.
Let us start with what are the pros and cons of the two options you can choose from. Our goal is by no means to manipulate or persuade you in what we think is right, but to present you the options so that you can choose yourself, according to your preferences, demands, needs, opportunities and so on. An advice in which you are urged to listen is to read carefully, not between the rows. If some of the presented information is left unintelligible to you, do not overlook it, instead go back to it. Remember, our accounting house provides you the opportunity to take advantage of free consulting services. Always act wisely according to your personal interests.
Registration of a company by an EU citizen - advantages and disadvantages
As mentioned above in this article, a significant part of our clients are citizens of different EU countries. We work with them on a daily basis, advise them and consult them so that the most complex and unsolved cases remain in the past. Thanks to the experience we have accumulated over the years and the situations in which we have been, today we can safely enumerate for you, young EU entrepreneurs, what are the pros and cons if you choose this option.
The registration of a company, we would not say that is a complex process, speaking of Bulgarian citizens. However, things get a completely different look when it comes to a foreign citizen. We are aware of the fact that modern people are over-restricted when it comes to their time. So one of the first questions we will look at is time.
Finalizing a company registration takes about 2-3 business days during which the person must be in the country. Once the registration itself has ended, another process, namely VAT registration, follows. Then it is necessary for the foreign citizen to visit the country once more, which means a solid amount of money and time.
Here is the time to make a brief remark regarding the power of attorney for that many of our clients are asking us. In order talk about a proxy, it should be made clear that without a UIC (unique identification code) available, it is impossible to obtain a power of attorney and to avoid the second visit to Bulgaria. That is why we at "Contabil" believe that this is one of the main prerequisites for registering a new business not being the most profitable option for you.
To sum up, we can say that for one registration you have to come twice in the country - once for the registration of the company itself and once again for the VAT registration. The VAT registration will take you nearly 14 days after the submission of the documents. Therefore, the time you have to take into account for establishing a company is about 3 weeks during which you should visit the country twice, if all the documents are correct and there are no further complications delaying the process.
Many users ask the question about the cost of the service. On the web site of the accounting house "Contabil" EOOD we have described the procedure in detail and the price you are required to pay is EUR 500. That, as you know yourself, is not a very high sum for a young entrepreneur who has decided to start his/her business and take the steps to success.
This is one of the solutions that we can offer to EU citizens, but not every one of them is experiencing the necessary dose of satisfaction because it is a very long stay. In addition, time, as you know, is extremely valuable for the modern people and almost impossible to sacrifice at the expense of finance. Here is the moment when you have to stop in one place, to look carefully at the situation on all sides, and only after you have deduced the advantages and disadvantages of the service to assess whether it meets your needs or move on to the next decision.
Selling a brand new company - advantages and disadvantages
After examining in detail the advantages and disadvantages of registering a company, we are going to pay as much attention to the second option, namely the sale of a new one, as it deserves. Before disclosing even the smallest details, we have to say that we are talking about a brand new company that has just been registered in the Commercial Register and for the purposes of VAT. Up until this very moment, this company has not performed any activity and the buyer of the company will be the first to register his/her activity.
We shall begin our analysis with the shortcomings in case you choose to buy a brand new company. In fact, if we have to be frank, some count them as flaws and other see them as a way of saving money.
The cost of the service is 900 euro.
If the buyers are two, they have to pay 950 euro.
For three buyers - the price is 1000 euro.
Why does the price increase with each subsequent buyer? The cost is due to notary fees for which it is also necessary to pay. This is the source of the cost increasing. In addition, if you want to change the name of the company you turn into your own, then this option is included in the price paid and you can freely take advantage of it.
It is now time to focus on the positive side of this option, choice, solution or alternative. Only one visit to the country is enough for completion of the company sale. Here is the time to think about how much you could save from staying within three weeks, as is actually required, if you choose the first option - a company registration. In addition, you will not be separated either with your family or with your business partners. The rest of the time will be invested in building plans for future actions related to the activity that will soon come to light. All this is an essential plus that you should not underestimate.
Maybe you suddenly decided to take advantage of the service, or you have made this decision spontaneously while you were in the country? We at CONTABIL are ready to react within a few minutes, triggering the sales process. We are able to provide you with a written translation of all documentation in English or Romanian. In this way, we further strengthen and reinforce the authority built over the years.
To acquire a clear and crystallized idea, we provide the company manager with more materials about how a Bulgarian company operates. We will create you an account for the web-based invoicing program to which the manager receives permanent access and we will sign the contract for the accounting services. Once we pass through the certification of documents made by a notary public, then the opening of the bank accounts follows. In order to provide maximum convenience and unprecedented privileges, we have managed to establish a relationship with a bank that is able to issue for you debit bank cards without you having to visit the country again. The payment orders are signed with a code that is received by you from the bank via SMS, so there is no need for a token device.
The option of buying a business is not as expensive for an international businessman, and before you register and pay, there is an opportunity to ask the questions that concern you about the company's future business, and especially whether the company's registration will solve the goals set and the problems it has.
Questions and activities that companies are interested in
There are a few key issues and activities that companies are interested in:
- The amount of taxes in Bulgaria
For those who do not know the profit tax in Bulgaria is 10%. The Profit is the difference between the company's revenues and its expenses. In Bulgaria the fiscal and calendar year coincide. One of the interesting things that the foreign citizen needs to get acquainted with is that the profit tax for the year in which the company is established, has to be paid out at once until March 31 of the following year.
If the total turnover (total sales) of the company for the past year is less than EUR 150000, then the profit tax for the current year must be paid out once until 31 March of the following year.
If the total turnover (total sales) of the company for the past year is higher than EUR 150000, the company has to estimate the expected profit for the current year. The estimation has to be done until March 31 of the current year and must be declared in the tax return papers. This estimation allows an error of 20%.
If the total turnover (total sales) of the company for the past year is between 150 000 euro and 1 500 000 euro, then the profit tax for the current year must be paid in quarterly instalments based on the estimation. The difference between the calculated tax and the actual profit tax must be paid by 31 March of the following year.
These and much more interesting information on tax rates can be found on our accountancy page.
- intra-community supplies of goods;
- triangular transactions;
- intra-community services;
- import in Bulgaria, which can be done without VAT.
Intra-community trade is an extremely important matter that you need to face in time to be able to act confidently and in the future.
We, at "Contabil" EOOD, Ruse we are ready to give you full support and assistance. We have tried to select detailed information on some of the most important issues for today's young businessman and to lay them out on our web-site - a company registration, a purchase of an already established company and intra-Community trade.
You can contact us in case you have additional inquiries. We offer free counselling for Bulgarian citizens and foreigners. CONTABIL is the right choice, leading you to excellence!