Incorporate a Company in Bulgaria: The Definitive Guide for French Entrepreneurs

Published on April 15, 2026 and written by Cyril Jarnias

The year 2026 marks a turning point for Bulgaria and, by extension, for French entrepreneurs planning to set up a business there. Currency change, new VAT rules, digital reporting obligations, and a still ultra-competitive tax framework: the environment is evolving, but remains one of the most attractive in the European Union for setting up a company with controlled costs and low taxation.

Why set up a company in Bulgaria as a French national

Setting up in Bulgaria means combining access to the single European market, low operating costs, and one of the most favorable tax frameworks in the EU. Bulgaria has been a member of the European Union since 2007, is fully integrated into the Schengen area, and is preparing to adopt the euro as its official currency. It offers a particularly attractive environment for service activities (tech, consulting, e‑commerce, SaaS, AI), as well as for industry or logistics, thanks to its strategic geographical position in Eastern Europe.

On the tax side, the combination of a corporate income tax rate of 10%, a moderate withholding tax on dividends (5%), and a dense network of double tax treaties, including one with France, positions Bulgaria as an attractive base for French entrepreneurs and groups.

The impact of the euro adoption on company formation

As of January 1, 2026, Bulgaria adopts the euro as its official currency, replacing the Bulgarian lev (BGN). This monetary transition has several very concrete consequences for company formation and management.

During January 2026, a dual circulation period is planned for cash payments: the lev and the euro will coexist, before the euro becomes the sole book and fiduciary currency. The official conversion rate is fixed at 1 EUR = 1.95583 BGN, and must be applied in full, without rounding.

For a French entrepreneur setting up a company in 2026, the advantage is twofold: no more exchange rate risk between euro and lev, and accounting, taxation, and invoicing directly in euros, simplifying cost comparisons and group-level account consolidation.

Understanding the main Bulgarian legal forms

Bulgarian law offers several company forms suitable for different projects. For a French entrepreneur, two forms dominate by far: the EOOD and the OOD, equivalents of the French SARL. Other structures exist, notably the new variable capital company, designed for growth projects and startups.

EOOD and OOD: the equivalents of the SARL

The EOOD (“Ednolichno Drujestvo s Ogranichena Otgovornost”) is the single-member limited liability company, while the OOD is the multi-member version. In both cases, members’ liability is limited to the amount of their contributions, with no personal liability for company debts (except in cases of specific management fault).

The minimum share capital is extremely low: 2 BGN, just over one euro. Legally, it is possible to create an EOOD or OOD with a symbolic capital. In practice, it is advisable to deposit a more credible capital (500 to 1,000 euros) to reassure banking and commercial partners. At least 70% of the subscribed capital must be paid up before registration.

The management of the company is carried out by one or more managers, again with no nationality or residency requirement. The manager must sign a declaration of consent and provide a notarized specimen signature.

AD: the Bulgarian joint-stock company

The AD (“Aktionerno Drujestvo”) is the joint-stock company, intended more for larger-scale projects requiring significant capital or a listing plan. The minimum capital is set at 50,000 BGN, approximately 25,000 euros.

The liability of shareholders is, as in EOOD/OOD, limited to their contributions. This format is generally relevant for SMEs of significant size or subsidiaries of structured groups, less so for a French solo entrepreneur who simply wants to optimize their taxation.

VCC: the variable capital company, a weapon for startups

The Variable Capital Company (often referred to as VCC) is the major innovation in Bulgarian company law. This structure, available since late 2024, does not require a mandatory minimum capital. Shares can have a very low nominal value (e.g., 0.01 euro).

Branches, representative offices, and other structures

Other forms exist but are less central for a full operational setup:

– The branch office of a foreign company, which has no separate legal personality and remains legally attached to the parent company;

– The commercial representative office, limited to non-commercial activities (prospecting, marketing, etc.) and cannot invoice;

– Partnerships (general or limited), or the sole proprietorship, which entail unlimited personal liability and are therefore poorly suited to an asset protection strategy.

For a French entrepreneur wishing to invoice, employ, and develop their business in Bulgaria, the EOOD, OOD, or VCC remain the most relevant structures.

Concrete steps to register a company in Bulgaria

Company formation is centralized via the Commercial Register (“Targovski registar”), managed by the Registry Agency. The process is standardized, largely digitalized, and can be carried out entirely remotely with proper support.

Choosing and reserving the company name

The company name must be unique in the Bulgarian register and include the suffix corresponding to the chosen form (EOOD, OOD, AD, etc.). Official registration is done in the Cyrillic alphabet, although a Latin equivalent may be used for commercial purposes.

A availability check, followed if necessary by a reservation, is performed online via the Registry Agency portal. The reservation fee is modest: 40 BGN for a paper filing, 20 BGN for an online filing.

Preparing the incorporation documents

The registration file includes notably: all information relating to the identity of the vehicle, its owner, and its registration history.

– The articles of association (Articles of Association for an OOD, deed of foundation for an EOOD);

– The minutes of the constitutive meeting;

– Declarations of consent from the manager(s), accompanied by their notarized signatures;

– Copies of the IDs of members and directors (passports for individuals);

– For a legal entity member, a certificate of good standing, the articles of association, and an investment decision;

– Proof of a registered office address in Bulgaria (commercial lease, title deed, or domiciliation/virtual office contract);

– A bank certificate attesting to the deposit of capital into a blocked account in the name of the company being formed.

All foreign documents must be translated into Bulgarian by a sworn translator and, depending on the country of origin, legalized via apostille (Hague Convention) or consular certification.

Filing the application with the Commercial Register

Registration is done online or at the counter. Registration fees are reasonable: 110 BGN for a paper filing, 55 BGN for an electronic application. In most cases, a decision is rendered within about three working days, with a total legal timeframe of one to seven working days.

The “express” processing option can further reduce these delays, at an additional cost.

Upon registration, the company is assigned a Unified Identification Code (EIK/UIC), which serves as both a registration number and a tax number (Bulstat).

Opening the operating bank account

During the formation phase, the capital was deposited into a temporary account. Once the company is registered, you need to open a definitive professional bank account and transfer the funds there. In practice, opening an account is the most sensitive step for a foreign entrepreneur, due to anti-money laundering regulations and the prudential policies of Bulgarian banks.

Formation costs: a genuinely low-cost setup

Direct formation costs (excluding advisory fees) are well below French standards. State fees (name reservation, registration, minimum capital) total less than 100 euros. Adding notarial fees, translations, and apostilles, and handling the procedure yourself locally, you remain within a range of approximately 224 to 307 euros.

Domiciliation and post-registration obligations

Every company must have a physical address in Bulgaria to receive official notifications. PO boxes are excluded. Foreign entrepreneurs frequently use virtual office services, which provide a legal address, mail handling, and sometimes telephone reception.

Once the company hires employees, employment contracts must be declared to the National Revenue Agency (NRA) within three days of signing. Additionally, the company must maintain regular accounting under Bulgarian accounting law and file annual accounts.

VAT registration is a separate step, also managed by the NRA, detailed further below.

VAT, the euro, and new small business regimes

The VAT framework in Bulgaria remains generally attractive, with a standard rate of 20%, but thresholds and registration rules are undergoing significant adjustments from 2026.

VAT registration threshold and deadlines

From 2026, the turnover threshold triggering mandatory VAT registration is set at 100,000 BGN, approximately 51,130 euros. The particularity is that the calculation is now based on a calendar year basis: as soon as taxable turnover exceeds this threshold during the current or previous year, the company must register.

An invoice including VAT for these transactions must, however, be issued within five days of receiving the formal registration act. It is therefore crucial to closely monitor your turnover to avoid any invoicing irregularities.

Small business exemption regime

Bulgarian law introduces new exemption regimes for small businesses, aligned with the European franchise regime. Two thresholds coexist:

– 51,130 euros for domestic activities;

– 100,000 euros for all activities within the EU.

For a French founder planning moderate turnover, this regime can reduce administrative complexity and cash tied up in VAT. In B2B or export sectors, voluntary VAT registration often remains relevant to recover tax on expenses.

Useful VAT summary for the French entrepreneur

Item	Bulgaria rule (2026)
Standard VAT rate	20%
Registration threshold	100,000 BGN (~51,130 EUR)
Threshold calculation basis	Calendar year (current or previous year)
Registration application deadline	7 days after exceeding threshold
Effective registration date	Day after threshold exceeded
Small business regime	Exemption up to 51,130 EUR (domestic) / 100,000 EUR (EU)
Exemption regime identifier	VAT number starting with “BG” and ending with “-EX”

For catering, tourism, or leisure activities, it is useful to note that the temporary reduced rates of 9% have been gradually eliminated, with most of these services reverting to the standard rate of 20%.

Corporate taxation: one of the major advantages

On the tax front, Bulgaria stands out for its simple structure and low rates, attracting both small independent structures and subsidiaries of international groups.

Corporate income tax: flat tax at 10%

Bulgarian corporate income tax is based on a flat rate of 10% applied to taxable profit. There are no progressive brackets or local surcharges: all profit tax is collected at the national level by the NRA.

This 10% rate is well below the EU average of around 21.27% and the OECD average (23.85%). It has been stable for many years and is expected to remain so in 2026.

A company is considered a Bulgarian tax resident if it is incorporated under Bulgarian law or if its place of effective management is in Bulgaria. It is then taxed on its worldwide income. A non-resident company is taxed only on its Bulgarian-source income, either through a permanent establishment (branch, fixed office) or via withholding tax.

Withholding taxes and dividends

Dividends paid by a Bulgarian company to an individual or to a non-resident entity outside the EU/EEA are subject to a withholding tax of 5%. However, if the beneficiary is a company resident in another EU or EEA member state, this withholding tax drops to 0%, subject to minimum participation conditions (generally 10% for at least 12 consecutive months, under the parent-subsidiary directive).

For a French entrepreneur, the tax treaty between Bulgaria and France plays a central role. It provides for reduced withholding tax rates on dividends, interest, and royalties, as well as a tax credit mechanism in France to avoid double taxation. Bulgarian-source income taxed in Bulgaria remains taxable in France, but France grants a corresponding tax credit, within the limits set by the treaty.

Essential rates and thresholds for a French founder

Tax / Contribution	Bulgaria (2026)
Corporate income tax	10% (flat rate)
Withholding tax on dividends	5% (0% for EU/EEA companies under conditions)
Standard VAT	20%
Personal income tax	10% (flat rate)
Social security contributions (total employer + employee)	Approximately 33% of gross salary
Effective global minimum tax rate (Pillar 2)	15% for groups with > €750M consolidated revenue

Global minimum tax and large groups

Since 2024, Bulgaria applies the global minimum tax rules of 15% for multinationals and large domestic groups meeting the threshold of €750 million in consolidated revenue in at least two of the four preceding financial years. Concretely, Bulgaria retains its nominal rate of 10%, but imposes a “top-up tax” so that the effective rate per jurisdiction reaches 15% for the entities concerned.

Other useful tax elements

Capital gains on assets and real estate are included in taxable profit and taxed at 10%. Losses can be carried forward for five years. R&D expenses benefit from incentive measures (accelerated depreciation, partial exemptions). Certain specific sectors (online gaming, maritime transport, high-unemployment areas) may access special regimes, including full exemption from corporate income tax in disadvantaged areas.

Finally, Bulgaria has a vast network of double tax treaties (over 70) covering most major economic partners, including France. This secures cross-border investment and limits the risk of double taxation on dividend, interest, royalty, or capital gain flows.

Digital reporting obligations: SAF-T and transparency

From 2026, Bulgaria is undertaking a major transformation of its tax audit system with the gradual introduction of the SAF-T (Standard Audit File for Tax), an OECD standard for electronic transmission of accounting data.

SAF-T: towards dematerialized tax reporting

The legal basis for SAF-T has been incorporated into the Tax and Social Security Procedure Code (TSSPC) and the state budget. The NRA is the authority responsible for this system, which aims to standardize and automate the communication of accounting data between companies and the tax administration.

The obligation will apply to almost all legal entities: companies, consortiums, sole traders, cooperatives, civil law companies, joint ventures, and branches or permanent establishments of foreign entities. However, micro-enterprises not registered for VAT, as well as public or non-commercial entities (payment funds, commercial representations, etc.), are excluded.

The deployment schedule is spread over five years:

SAF-T obligation start date	Companies concerned (criteria based on prior years)
January 1, 2026	Large enterprises with 2023 revenue > 300 M BGN or taxes + contributions > 3.5 M BGN
January 1, 2027	Large, medium, small with 2024 revenue > 300 M BGN or taxes + contributions > 3.5 M BGN
January 1, 2028	Large, medium, small with 2025 revenue > 15 M BGN or taxes + contributions > 1.5 M BGN
January 1, 2029	All large, medium, and small enterprises
January 1, 2030	Micro-enterprises, generally those registered for VAT

SAF-T filings must be submitted in structured XML format, signed electronically. Three frequencies of reporting are planned:

Companies benefit from a six-month grace period after entering the system, without penalties for non-compliance. Corrections are possible within six months of each filing. Thereafter, fines are provided: from 500 to 2,000 BGN for individuals, and from 5,000 to 15,000 BGN for legal entities, with caps reaching 30,000 BGN in case of repeat offenses.

For a French entrepreneur starting up in 2026 with a small structure, the immediate impact will be limited, but it is prudent to choose from the outset an accounting software compatible with the future SAF-T schema and an accounting firm familiar with these requirements.

International tax transparency and transfer pricing

Bulgaria is also strengthening its arsenal regarding transfer pricing, aligning with OECD guidelines. A new ordinance introduces:

Companies must be ready to robustly document their transfer pricing policies; the administration may reject analyses deemed non-compliant or provided late.

In parallel, the EU has imposed public Country-by-Country Reporting (Public CbC Reporting) on large groups, applicable to groups with consolidated revenue exceeding €750 million and operating in the EU through subsidiaries or branches. For most French SMEs established in Bulgaria, these obligations will remain theoretical, but they may concern subsidiaries of large groups.

Labor, immigration, and hiring: what a French employer should know

Creating a company also often means hiring locally or seconding employees. Bulgarian labor and immigration law has some specificities to be aware of.

Local hiring: contracts and obligations

Employment contracts must be concluded in writing, under penalty of administrative sanctions. The employer is required to declare each contract to the NRA within three days of signing and to provide the employee with a copy of this declaration before starting work.

The contract must include a set of mandatory elements: identity of the parties, workplace, position, start date, duration (fixed-term or indefinite), paid leave, notice periods, remuneration and payment frequency, length of the working day or week.

A probation period is possible for up to six months, including for the exclusive benefit of the employer. For fixed-term contracts of less than one year, the probation period cannot exceed one month.

Working time conditions provide for a minimum daily rest of 12 hours, a weekly rest of two consecutive days, and a strictly limited overtime regime (maximum 150 hours per year, with monthly and hourly caps).

Labor law and employee protection

Bulgarian law includes a statutory minimum wage set annually by decree, a minimum of 20 days of paid annual leave after four months of service, and protection against discrimination (sex, origin, religion, age, sexual orientation, disability, etc.). The law mandates equal pay for work of equal value.

Social security obligations include payment of contributions to social security and health insurance, representing approximately 33% of gross salary (employer + employee share).

Immigration and foreign personnel

Citizens of the EU, EEA, and Switzerland may enter, reside, and work in Bulgaria without a visa or work permit, subject to registration beyond 3 months of stay. French nationals are therefore free to work for a Bulgarian company without heavy formalities, other than a declaration of presence.

A Bulgarian employer is subject to quotas on the number of third-country workers it can hire, proportional to its workforce. Legislative adjustments are underway to ease these quotas and address labor needs, notably raising the share of third-country employees to 25% for large companies and 40% for small and medium-sized enterprises, within the limits of priority projects and sectors.

For a French entrepreneur, these rules only apply if they wish to hire non-EU employees in Bulgaria (e.g., developers from Ukraine or Asia). Founders and directors of foreign companies registered in Bulgaria do not need a work permit, only a visa and long-term residence permit if they wish to reside locally.

Recurring costs and practical organization

Beyond the initial formation cost, it is important to estimate the recurring expenses to keep a company running in Bulgaria.

Accounting fees and tax support vary according to the volume of documents and the complexity of the activity. For a small structure, it is realistic to budget between 80 and 300 euros per month for bookkeeping and filings, to which can be added 50 to 200 euros for domiciliation or a virtual office.

Annual obligations (filing accounts, statistical declarations, etc.) can represent between 300 and 800 euros in service fees depending on complexity and the level of outsourcing.

For a French entrepreneur operating a digital services EOOD with moderate turnover, a total monthly budget of 200 to 300 euros in structural costs (excluding salaries) is often a realistic baseline.

Putting into perspective: advantages and points of vigilance

Creating a company in Bulgaria in 2026 offers a rare combination of legal simplicity, low cost, and tax optimization, particularly for service activities geared towards international markets. Monetary convergence with the euro eliminates exchange rate risk and facilitates dialogue with French partners. The 10% corporate income tax, low withholding tax on dividends, and network of tax treaties, including with France, provide a clear competitive advantage.

However, certain points of vigilance deserve to be anticipated:

By mastering these parameters, a French entrepreneur can fully leverage Bulgaria’s environment, whether to deploy a purely operational structure on the ground, to host a digital activity targeting the EU, or to structure a group subsidiary benefiting from reduced taxation within the single market.