How to transfer a car from a company to an individual after obtaining a permanent residence permit or EU long-term resident status

Foreigners with a residence permit in Bulgaria usually set up a company in order to buy and register a car. This is more convenient than the “blue plates”, which are issued to holders of a long-term residence permit for one year only, and renewing the registration means travelling to the capital. A dormant “zero-activity” company is easy to set up and causes little trouble.

Once a foreigner obtains permanent status, the situation changes: the car can now be registered in their own name as an individual. Many prefer not to do this and leave the car with the company. Those who do want to transfer the vehicle into their own name have to conclude a sale and purchase transaction with their own company, buying back their own car.

The procedure

The transaction itself is not difficult to conclude – you need to go to a notary and explain the situation, then sign the contract and pay the tax. The contract must state the value of the car – the notary can calculate it. If the notary does not provide such a service, the valuation can be ordered from an insurance company, which costs approximately 15 – 30 leva.

Documents for concluding a car sale and purchase transaction:

• the vehicle documents (the large and small registration certificates);
• a document confirming payment of last year’s tax (not always required, the notary can often see the necessary information in the database);
• the compulsory third-party liability (GO) insurance policy;
• a certificate of the insurance value of the car (if the notary does not carry out the valuation themselves);
• proof of the company’s ownership of the car (for example, a sale and purchase contract);
• a document certifying the right of the company’s representative to conclude transactions on its behalf;
• a certificate of the company’s current status and the company seal;
• the seller’s declaration of the absence of debts.

Once the transaction has been concluded before the notary, you can go to the KAT (traffic police) at your place of residence to register the car in your name. This must be done within one month. If you are late, the vehicle’s registration certificate and number plates will be considered invalid.

If all the car’s documents are in order, the roadworthiness test has been passed, the taxes have been paid, the insurance has been bought and the plates do not need changing, registering the car at the KAT will take a minimum of time. In that case the notary enters all the data into the system, and the new owner only has to pay the fee at the KAT and receive new vehicle documents in place of the old ones.

If some documents are missing, they must be obtained before visiting the KAT. After that the registration is carried out in the standard way. You need to come to the KAT with the car documents (the large and small registration certificates, copies of the GO insurance and the certificate of the passed roadworthiness test), the notarised sale and purchase contract and your personal documents, pay the fee and receive new documents in place of the old ones.

When the transaction is concluded, the information is automatically sent to the local municipality (Obshtina), and the car tax is then paid by the individual rather than the company.

What difficulties you may face

A purchase from a company must be supported by documents – a cash receipt and an invoice. As an alternative, the purchase can be paid for by bank transfer. The difficulty is that dormant companies usually have neither a cash register nor a corporate bank account.

In addition, it must be taken into account that once the transaction is carried out the company automatically becomes active. This means that reports will have to be filed and profit tax paid.

So it will not be possible to transfer a car from a company to an individual on your own – you will need the help of an experienced accountant. The specialists of Bulgarian Expert are ready to provide you with services for transferring a car to an individual.

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