10% flat income tax (lowest EU rate tied with Romania) + 13.78% social contributions (employee). Dividends: 5%, Interest: 8%. Social capped at 3,850 BGN/month.
Bulgaria is the EU's hidden gem for high earners and entrepreneurs: 10% flat income tax + 13.78% social contributions = 76% take-home on most income. A €100,000 earner pays €10,000 tax + €13,780 social = €76,220 net. Compare to Germany (€50-55K net) or France (€48-53K net). Even better: dividends taxed at just 5% (vs 15-30% in most EU countries), and social contributions capped at 3,850 BGN/month—income above €23,616 annually is taxed at only 10% with no additional social. Bulgaria has been EU's best-kept secret since 2008 when it introduced the 10% flat rate.
Bulgaria offers the most competitive tax system in the European Union: a 10% flat income tax (tied with Romania for EU's lowest) combined with relatively low 13.78% employee social security contributions, resulting in a total tax burden of just 23.78%—dramatically lower than most EU countries. There are no progressive tax brackets, and high earners benefit from a social contributions cap of 3,850 BGN per month (~€1,968), meaning income above this threshold is only taxed at 10%. Dividends are taxed at just 5% (the lowest rate in the EU), making Bulgaria exceptionally attractive for entrepreneurs and investors. Interest income is taxed at 8% (reduced from 10% in 2025). Bulgaria introduced a digital nomad visa and is rapidly becoming a hub for remote workers, particularly in Sofia (the capital) and Plovdiv, thanks to its low taxes, affordable cost of living (€800-1,200/month), and fast internet infrastructure. Use our calculator to see how much you'd keep after Bulgarian taxes.
| Taxable Income | Tax Rate |
|---|---|
| All employment income | 10% flat |
| Social contributions (employee) | 13.78% |
| Social contributions (employer) | 18.92-19.62% |
| Dividends | 5% |
| Interest income | 8% |
Note: These are marginal rates - you only pay the higher rate on income within each bracket.
Bulgaria has a 10% flat income tax rate on all personal income for 2026—the same rate it has maintained since 2008. There are no progressive tax brackets; everyone pays 10% regardless of income level. This is the joint-lowest rate in the European Union (tied with Romania). The 10% rate applies to salaries, business income, rental income, and most other personal income. Dividends are taxed separately at 5%, and interest income at 8%.
Bulgarian social security contributions total 32.7-33.4%, split between employee (13.78%) and employer (18.92-19.62%). Critically, contributions are capped at 3,850 BGN per month (~€1,968 or ~€23,616 annually). Income above this cap is only subject to the 10% income tax with no additional social contributions. This makes Bulgaria exceptionally attractive for high earners—someone earning €100,000 pays the same social contributions as someone earning €23,616 (the cap), but only 10% income tax on the excess.
On a €60,000 annual salary in Bulgaria, you would pay approximately: €6,000 income tax (10%) + €8,268 social contributions (13.78% capped at ~€60K since cap is €23,616—only €23,616 subject to social) = €14,268 total. Your net take-home: €45,732 (76.2% of gross). This is significantly higher than most EU countries. For comparison, the same €60K salary in Germany would net you ~€36,000-38,000 (60-63%), or in France ~€37,000-40,000 (62-67%).
Bulgaria's 5% dividend tax is the lowest in the European Union and one of the lowest globally. Compare to: Romania 16%, Germany 26.375%, France 30%, UK 38.1% (top rate), Netherlands 26.9%, or Ireland 51% (top rate). Entrepreneurs and investors can structure income as dividends and pay just 5% tax. A €100,000 dividend distribution costs €5,000 in tax vs €15,000-30,000+ in most EU countries. This makes Bulgaria a magnet for holding companies, startups paying dividends, and investors optimizing tax efficiency while remaining in the EU.
Yes, Bulgaria launched a digital nomad visa allowing remote workers to live and work in Bulgaria for up to 12 months (renewable for another 12 months). Requirements include: proof of remote employment or self-employment generating at least 3,117 BGN/month (~€1,594), health insurance, clean criminal record, and accommodation in Bulgaria. Digital nomads benefit from Bulgaria's 10% flat tax, 5% dividend tax, low cost of living (€800-1,200/month in Sofia), fast internet, and EU membership. Popular bases: Sofia (capital, tech scene), Plovdiv (cultural hub, lower costs), and Bansko (ski resort turned digital nomad hub).
Both Bulgaria and Romania have 10% flat income tax, but Bulgaria's total tax burden is significantly lower due to social contributions. Romania charges 35% employee social (25% CAS + 10% CASS) for a 45% total burden. Bulgaria charges 13.78% employee social for a 23.78% total burden—nearly half Romania's rate. Additionally, Bulgaria's dividend tax is 5% vs Romania's 16% (as of 2026). Both are excellent for digital nomads, but Bulgaria is objectively better for high earners and entrepreneurs who can structure income as dividends.
Social security contributions in Bulgaria are capped at 3,850 BGN per month (~€1,968) for 2026. This means monthly gross income above 3,850 BGN is only subject to the 10% income tax with no additional social contributions. Annualized, the cap is ~€23,616. Someone earning €100,000 pays the same social contributions (€3,261 annually = 13.78% of €23,616) as someone earning €23,616, but only 10% income tax on the remaining €76,384. This cap makes Bulgaria exceptionally attractive for six-figure earners.
The Bulgarian annual tax return deadline is April 30, 2026 for the 2025 tax year. Tax residents must file with the National Revenue Agency (NRA) either online through the NAP portal or in person at regional tax offices. Employees with only employment income taxed at source typically don't need to file. Self-employed individuals, business owners, landlords, and those with foreign income must file annually. The tax year in Bulgaria runs January 1 - December 31.
Bulgarian tax residents are taxed on worldwide income at the 10% flat rate. Foreign employment income, rental income, and business profits are all subject to the 10% tax. Bulgaria has tax treaties with 70+ countries to avoid double taxation through foreign tax credits. Capital gains from selling securities are tax-exempt if shares are held for more than 1 year and traded on regulated markets. Short-term capital gains (under 1 year) are taxed as ordinary income at 10%. Foreign dividends received by Bulgarian residents are typically taxed at 5% (subject to tax treaty provisions).
US citizens in Bulgaria face US worldwide taxation obligations but can benefit from Bulgaria's low rates through the Foreign Earned Income Exclusion (FEIE - up to $132,900 excluded for 2026) or foreign tax credits. A US citizen earning €80,000 in Bulgaria would pay €8,000 Bulgarian income tax (10%) plus €3,261 social contributions, then file US taxes and claim either FEIE (if eligible) or foreign tax credits. However, Bulgaria's low 10% rate means lower foreign tax credits, potentially leaving residual US tax liability. The Bulgaria-US tax treaty helps avoid double taxation. US expats should consult cross-border tax professionals.
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Send Money To/From Bulgaria →Last Updated: March 2026