ET registration — sole trader in Bulgaria

While an OOD (LLC) in Bulgaria can be opened by anyone, including a foreign national living outside the country, an ET can only be registered by a foreigner permanently residing in the country who holds a permanent residence permit or EU long-term resident status.

Another substantial difference is that an ET is a natural person, not a legal entity. An едноличен търговец must have legal capacity and hold an EGN (unified civil number).

Before registering, you need to bear in mind that a sole trader is liable for his obligations with all the property he owns.

ET registration in Bulgaria

Registration should start with the name of the ET. By law it must contain the entrepreneur’s name. Before registering, you need to make sure that such a name is available, i.e. that no one else has already taken it. This can be done on the website of the Commercial Register, which holds information on all ETs. That said, where an ET is registered by a foreigner, it is unlikely that someone else has already used his name.

The following documents are required for registration:

1. An application «за вписване на обстоятелства относно едноличен търговец». The form can be downloaded from the Commercial Register website. The application must be filled in and printed out, but it is signed on the spot, when the documents are submitted.
2. Consent to act as manager and a specimen signature. The document is completed following the template and signed. Notarial certification is required!
3. A declaration under Art. 13 para. 4 of the Commercial Register Act (on the accuracy of the information submitted). The entrepreneur’s signature is required.
4. A declaration under Art. 57 and 58, para. 2 and 4 of the Commerce Act (on the absence of circumstances preventing registration as an ET). A signature is required.
5. A declaration under Art. 57 para. 4 of the Commerce Act. A signature is also required.
6. An identity document (foreign nationals need to bring not only the personal card showing the EGN, but also the passport).

Some activities (for example, opening a pharmacy) require a licence.

ET registration involves paying a state fee, which is considerably lower when the documents are submitted online. The application is processed within up to three working days.

All documents must be filled in and signed correctly. If there are mistakes, registration may be refused — and the registration fee is not refunded. So if you are unsure about anything, it is better to turn to specialists.

After the ET is registered you also cannot do without specialists — it is advisable to consult an accountant for information related to taxation, payment of osigurovki (social contributions), purchase of a cash register, VAT registration, opening a bank account and so on.

ET reporting

Filing reports as a sole trader in Bulgaria also has its specifics. Even if a sole trader carries out no activity, he must file a number of mandatory reports.

ETs file the annual tax return as natural persons. This means the return need not be filed if there was no income in the past year, or if there was income only under the items listed in Art. 52 of the Personal Income Tax Act. At the same time, if the sole trader received other income as a natural person, the obligation to file a return remains.

An annual financial report (GFO) must also be filed. If the profit for the year did not exceed 200 thousand leva and there is no need for an independent financial audit, the GFO may include only the income and expense statement. Also, where no financial audit is required, sole traders are exempt from the obligation to publish the GFO.

One more mandatory report is the GDO, i.e. the annual activity report under the Statistics Act. The incoming number received when this report is filed should be entered in the tax return. This report may be omitted if two conditions are met simultaneously:

1. No activity was carried out during the year;
2. There were no income and expense statements during the year under the accounting legislation.

If no activity was carried out during the year, a corresponding declaration must be filed with the National Statistical Institute (NSI).

As with ET registration, it is advisable to entrust the preparation of reports to specialists who are aware of all the new developments in Bulgarian legislation. The company «Bulgarian Expert» offers accounting and reporting services for companies and sole traders. You can also always contact us for a consultation — free of charge.

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