Doing business in Bulgaria is not only an opportunity to make a profit, but also a considerable responsibility. A company faces fines for failing to file reports or filing them late, and the amounts can be significant.
For a missing VAT report the first fine will be 500 — 1000 leva, and it increases for a repeat offence.
The fine for failing to file a company’s annual tax return or filing it late ranges from 500 to 3000 leva, and up to 6000 leva for a repeat offence.
The annual financial statement is published in the Commercial Register once a year. If the company carried out no activity, a corresponding declaration must be filed for that year. If no activity is carried out thereafter, the report does not have to be published after the second year; only a declaration to the NSI (statistics) is filed.
The consequences of neglecting this obligation, in the form of fines, are set out in two laws:
The «Закон за счетоводство» provides for a fine of 200 to 3000 leva for the guilty person, and for a legal entity a property sanction of 0.1 to 0.5% of the net profit for the reporting period to which the unpublished report relates, but not less than 200 leva.
The «Закон за търговския регистър и регистъра на юридическите лица с нестопанска цел» provides for a fine of 500 to 3000 leva, and if the report is still not published after it has been imposed, the legal entity is fined 500-1000 leva each month until publication.
If the company is dormant, there may be no fine the first time and it may be limited to a warning, but sanctions cannot be avoided later on.
If this report does not include some invoices for sales made, you will have to pay 5% of the turnover, which can be quite substantial with large turnovers. Invoices for expense transactions may be entered in the reports later, within 12 months. But keep in mind that for transactions within the EU, for expense invoices the accountant also issues protocols, with a deadline of up to 15 days of the month following the reporting month. If this is not done and not reflected in the reports, an inspection will result in a fine for each invoice.
This report is submitted to the NSI (Statistical Institute) regardless of whether any activity was carried out or not. If the report is not filed or is filed late, the fine will be from 200 to 2000 leva (and up to 6000 leva for a repeat offence).
It is important for managers to provide all documents to the accountant on time and not to count on their mistakes going unpunished. The main advice on how to avoid fines is simple: you need to work with a competent accountant who submits all reports correctly and on time. The accountants at Bulgarian Expert offer both ongoing company services and one-off reporting services. You can be confident that all documents will be prepared correctly and within the deadlines set by law, which means your company will not face fines.
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