June 2018 / Bulgaria

On 29 May 2018, the Ministry of Finance published for public consultation a proposal for amendments to regulations for the application of the VAT Act. Below the most important topics mentioned in the proposal are listed:

• the requirements related to annual adjustment of input VAT in the case of mixed use of business assets;
• clarifications on input VAT adjustment in the case of VAT deregistration of a person;
• details on the register of the persons exempt from the obligation for providing security to tax authorities when receiving liquid fuels;
• clarifications regarding gold coins considered as investment gold and exemption from VAT on their importation;
• the inclusion of goods provided under finance lease in the nomination of the formula for calculating the pro rata VAT deduction; and
• the abolishment of the requirement for the submission of a list with the available assets at the date of the VAT registration.

On 19 June 2018, the parliament's Committee on Regional Policy, Urban Development and Local Self-Government adopted a law amending the Local Taxes and Fees Act. A special tax will be introduced on "non-rented accommodation", including, among other things, accommodation in owner-occupied vacation homes. Individuals often provide such accommodation to tourists and do not declare the fee charged, pretending that the accommodation was provided without a fee. Therefore, a surcharge of between 0.5% and 0.7% on the tax due on each property located in mountain and/or naval resorts is introduced. The exact amount of the tax for each property will be determined by each municipality through an ordinance yet to be introduced. The tax on the "non-rented accommodation" is expected to enter into force on 1 January 2019.

On 28 June 2018, the National Revenue Agency published on its website the 2018 version of the Manual on corporate income taxation. The Manual provides a detailed overview of the applicable legislation as well as numerous examples with comments by the authorities.