January 2019 / Bulgaria

On 8 January 2019, amendments to the Regulations for the application of the Value Added Tax Act were published in the State Gazette. For previous reporting on the Regulations, which apply from 1 January 2019, see Proposed amendments to Regulations for application of Value Added Tax Act.

On 14 January 2019, the National Revenue Agency published on its website an official announcement concerning persons dealing with cryptocurrencies. The main items of the announcement are listed below:

• gains of individuals from the sale or exchange of virtual currency generated in 2018 are subject to personal income tax at 10%, which must be declared and paid by 30 April 2019. Companies which realized such gains in 2018 must declare and pay corporate income tax at 10% no later than 31 March 2019;
• gains from the sale of cryptocurrencies are considered gains from the sale of financial assets; and
• the National Revenue Agency is initiating tax audits of companies and platforms dealing with cryptocurrencies. It is of the opinion that there is a risk of tax evasion as these transactions are conducted anonymously.

The announcement (in Bulgarian) is available on the National Revenue Agency's website.

On 17 January 2019, the National Revenue Agency published on its website an updated version of the regulations on the application of the VAT Act, which includes the amendments applicable as from January and July 2019. The document (in Bulgarian) is available here.

According to an update of 17 January 2019, published by the German Ministry of Finance, Bulgaria and Germany initialled an amending protocol to the Bulgaria - Germany Income and Capital Tax Treaty (2010) on 14 August 2018. Further developments will be reported as they occur.