Since September 2023, accountants in Bulgaria have had more work: new declarations and reports now have to be filed. These changes also affect legal entities and individuals, whose income will now be monitored more closely.
After the amendments to the laws on value added tax, corporate taxation and personal income came into force, Bulgaria began to monitor citizens’ personal funds and companies’ cash turnover more closely. In particular, the rules for declaring royalties and licence fees accrued or paid in favour of foreigners who are EU residents have changed. An obligation has also appeared to declare data on current accounting records: if at the end of a quarter the total amount of cash on hand exceeds 50 thousand leva, three declarations must be completed during the following month. In addition, managers’ loans and amounts of funds held on account are monitored. Control over funds held by individuals is being tightened.
It might seem that this information should be of interest only to accounting firms, but that is not so: the changes affect individuals as well.
For example, it will now be possible to receive no more than 1000 leva per day in dividends in cash.
All financial flows are monitored not only inside the country and for its residents.
It is no secret that, as of this year, the automatic exchange of financial information on the accounts of individuals and legal entities between countries has taken on a more global character.
Under such an exchange, financial institutions in various countries, including various offshore territories, must report to the tax authorities the opening of accounts and deposits by non-residents, their balances and the income received.
The tax authorities, in turn, pass this data on to those states where the individuals and legal entities are tax residents.
Thus, against the background of a reduction in cash turnover, the process of increasing control over financial flows and combating tax evasion by both legal entities and individuals is advancing rapidly. It is evident that the agreements reached and already in force between numerous countries imply a system of global control over the movement of funds and over everyone’s compliance with tax legislation.
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