On 8 December 2020, Bulgaria officially extended the deadline for the payment of the personal income tax (PIT) due and the submission of the PIT returns of persons performing economic activity as traders, as well as registered agricultural producers, on a permanent basis. Consequently, as from the year 2021, the deadline for the submission of PIT returns and the payment of the PIT due will be permanently extended from 30 April to 30 June of the year the PIT returns and payments refer to.
The permanent extension of the PIT deadlines, as well as a number of other amendments to the PIT Act have been promulgated in the State Gazette. Below is a summary of the main changes.
New tax relief for improvements/repair of immovable property
As from 1 January 2021, a tax relief will be introduced for improvements/repairs of an immovable property. Expenses of up to BGN 2,000 (approximately EUR 1,000) for repairs and/or improvements of residential property will be deductible from the annual PIT base of individuals who are tax residents in an EU/EEA country, provided that the following conditions are met:
- the residential property is in Bulgaria;
- the taxable person is the owner or co-owner of the residential property;
- the improvements and/or repairs are performed by EU/EEA residents;
- the residential property is not included in the enterprise of a person who is performing economic activity as a trader under the Commercial Act;
- the taxable person possesses a document (with the required requisites under the Accountancy Act) for the paid labour in relation to the performed improvements and/or repairs of the residential property; and
- the taxable person and the person that performed the repair are not related parties.
Documentation simplifications
The documentation requirements provided in the PIT Act in certain cases of transactions between individuals will be simplified.
The amendments to the PIT Act are included in the additional provisions of the amendments to the Value Added Tax (VAT) Act. The document is available here (in Bulgarian only).