With this transition, Bulgaria gained access to new economic and trade opportunities. Find out what entering the Schengen zone means for businesses in Bulgaria in this article.

What is the Schengen Zone?

First introduced in 1985, the Schengen area allows free travel between member countries with no internal border controls. Instead, members implement uniform controls at the external borders of the Schengen area. Countries within the Schengen zone also enjoy free movement of goods and services.

Which Countries are Part of the Schengen Zone?

In 2025, the Schengen zone consists of 29 countries. Alongside the majority of countries in the European Union (EU), four non-EU countries are also members: Norway, Iceland, Liechtenstein, and Switzerland. Bulgaria and neighbouring Romania are the latest countries to join the Schengen area.

How Will Bulgaria Benefit From Entering the Schengen Zone?

Being part of the Schengen zone comes with an array of benefits, all of which ultimately help generate financial prosperity and opportunities for member states. The Schengen area is built on strong foundations of trust, unity, and cooperation between its members. As a result, Bulgaria will be naturally able to build closer relationships with other Schengen zone countries.

Free movement of people within the Schengen area could also make Bulgaria a more desirable location for travel and tourism, in turn boosting the economy. And with no tariffs on goods moved between member states, Bulgaria can enjoy prosperous trade relations with other Schengen zone countries. Finally, harmonised systems and constant information exchange between law enforcement agencies within the Schengen area will help facilitate swifter responses to security threats.

Benefits of the Schengen Zone for Businesses in Bulgaria

Entering the Schengen zone is great news for businesses in Bulgaria; it opens the door to financial benefits, smoother supply chains and processes, and new opportunities for growth.

Key benefits include:

• Access to Cross-border Employees. The Schengen area’s free movement currently allows 1.7 million people to live in one Schengen zone country while working in another. Free movement grants businesses in Bulgaria access to a wider pool of talent from neighbouring and nearby Schengen area countries like Romania, Greece, Hungary, and Croatia.
• Free Movement of Services. Not only does free movement mean skilled workers can travel from neighbouring Schengen zone countries into Bulgaria to work, but services can also be freely provided beyond the Bulgarian border. For example, businesses in Bulgaria could explore extending their services across the border into Romania.
• Free Movement of Goods. Movement of goods between Schengen zone countries is free from tariffs or border controls. This will allow businesses in Bulgaria to enjoy reduced administrative costs, and more efficient transportation of goods to and from other Schengen area members.
• Tourism and Hospitality Opportunities. Free travel makes countries within the Schengen zone more attractive and accessible to tourists. Europeans residing in the Schengen area can easily visit neighbouring member countries, and third-country nationals can explore the Schengen area freely for up to three months with a Schengen visa. Entering the Schengen area could therefore bring great economic benefits for tourism and hospitality businesses in Bulgaria.

Navigating Business in the Schengen Area With Leinonen Bulgaria

If you are unsure how joining the Schengen zone will affect your business from a tax and accounting perspective, Leinonen Bulgaria can help. Having amassed 1500+ satisfied clients, our local experts in payroll, tax, and accounting have been diligently supporting businesses in Bulgaria for more than 14 years.

Interested in Exploring Business in Bulgaria?

If you are considering branching out into a new market now Bulgaria has entered the Schengen zone, a solid understanding of regulations around tax and accounting in Bulgaria is vital. Leinonen’s local experts can offer the support you need, so your business in Bulgaria can truly thrive. Contact Leinonen Bulgaria today to arrange a consultation and get the vital knowledge you need on navigating payroll, tax, and accounting in Bulgaria.

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As a business operating in Bulgaria, it is important to both understand the cultural significance of these dates, and know your legal obligations.

Which Dates are Public Holidays in Bulgaria?

The following public holidays are paid non-working days in Bulgaria:

• 1 January – New Year’s Day
• 3 March – National Holiday (Bulgaria’s Liberation from the Ottoman Empire)
• 1 May – Labour and International Worker’s Solidarity Day
• 6 May – St. George’s Day, and Day of Valour and of the Bulgarian Armed Forces
• 24 May – Bulgarian Education and Culture, and Slavic Script Day
• 6 September – Unification Day
• 22 September – Independence Day
• 24 December – Christmas Eve
• 25 and 26 December – Christmas Days

Are any Public Holidays Celebrated on Different Dates Each Year?

Yes, the Easter holidays of Good Friday, Holy Saturday, Easter Sunday, and Easter Monday fall on a different date each year in accordance with the Orthodox calendar.

In 2025, they fall on the following dates:

• 18 April – Good Friday
• 19 April – Holy Saturday
• 20 April – Easter Sunday
• 21 April – Easter Monday

Are There any Free Days in Bulgaria for Specific Industries?

Yes, the Day of the Bulgarian Enlighteners is a special non-study and non-working day for educational institutions. This holiday falls on 1 November each year.

What are Employees Entitled to During Public Holidays in Bulgaria?

According to article 264 of the Bulgarian Labour Code, employees scheduled to work on a public holiday are entitled to at least double the wage they would normally get. This applies whether the work is overtime or not.

Entitlements of Non-Christian Employees on Religious Holidays

As a majority Eastern Orthodox Christian country, Christian religious holidays are free days in Bulgaria. However, as per article 173 of the Labour Code, employees who profess a religion other than Eastern Orthodox Christianity are entitled to paid or unpaid leave on the days of their own religious holidays.

Holiday Pay in Bulgaria

Employees who work more than four hours a day in Bulgaria are entitled to a minimum of 20 working days in paid annual leave. This entitlement starts after they accumulate at least four months of employment.

Calculating Holiday Pay in Bulgaria During Public Holidays

If a public holiday falls within an employee’s arranged annual leave, the public holiday should not be counted as part of their annual leave. For example, if an employee has four days of leave organised from 4 September until 7 September, Unification Day (6 September) should not be deducted from their accrued annual leave days. In this case, only three days should be deducted from their annual leave, but they should be paid for four (as public holidays are paid).

Manage Public Holidays in Bulgaria With Leinonen

Boasting a multilingual, highly skilled workforce, and one of the lowest corporate income tax rates in Europe, Bulgaria is fast becoming an attractive location for foreign-owned businesses. But while Bulgaria is an EU member state, it has held onto many unique regulations in everything from accounting to labour relations, as well as its own currency (the Bulgarian lev).

Leinonen has 14 years of experience supporting foreign-owned businesses in Bulgaria, and our vastly knowledgeable team of financial specialists are ready to take your business to the next level. Get in touch today to find out how we can help you navigate Bulgaria’s unique local laws and customs to maximise your success.

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Pursuant to Art. 128b, para. 3 of the Labor Code (LC) with Decree No. 71 of May 10, 2018 of the Council of Ministers, an Ordinance was adopted on the type and requirements for the creation and storage of electronic documents in the labor file of the employee (the Ordinance).

The Ordinance regulates:

• the type of electronic documents that can be part of an employee’s file;
• the requirements for the creation and exchange of electronic documents between the employee and the employer, as well as the certification of its delivery (trusted e-delivery system);
• the requirements for the storage of electronic employment documents.

It should be emphasized that an option for digital employment records is legally ensured however, possibility to create and store employment documents on paper continues to exist.

In the Internal Rules, the employer must define:

• the type of documents that are created and stored as electronic documents;
• the type of electronic signature used by employees.

The costs for the construction, maintenance, and use of an information system for electronic employment documents are at the expense of the employer (Article 2, Paragraph 2 of the Ordinance).

The formal and explicit consent of the employee for the exchange of electronic employment documents between the parties is a must. 

As a minimum, a system for electronic employment documents must include the following functionalities:

• Ensured data protection (encrypted environment and multi-factor authentication (MFA))
• Remote elctronic identification of signatories (employer and employees).
• Singing of documents by employer with QES (qualified electronic signature) and by employee’s side with Universal or Basic electronic signature type.
• Integrated Electronic registered mail according to the eIDAS Regulation*.
• Constant access of all employees to the electronic platform and his/her file with documents. Acceses must be ensured after termination of employment relations as well.
• All costs are covered by employer.

*Pursuant to § 1, Item 5 of the Additional Provision of the Ordinance “electronic registered mail service” is the concept defined in Art. 3, item 36 of Regulation (EU) No. 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and authentication services in electronic transactions on the internal market and on the repeal of Directive 1999/93/EC.

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What is E-invoicing?

Electronic invoicing (e-invoicing) is a contemporary approach to accounting that allows businesses to digitally send and receive invoices in a way that does not require traditional paperwork. In most cases, e-invoices are sent directly from one party’s e-invoicing application to another’s, requiring little to no manual input. The e-invoice is delivered in a digitalised format that can be automatically read and processed by the recipient’s system. E-invoices are sometimes referred to as EDI invoices or e-bills.

E-invoicing in Bulgaria

While e-invoices are recognised as official documents by both Bulgarian and European legislation, a common structured e-invoicing system is not yet available in Bulgaria. This means that e-invoices are typically sent via email, rather than directly from one accounting system to another. Though this does remove an element of automation from the process, there are still an array of benefits of e-invoicing in Bulgaria.

Benefits of E-invoicing for Businesses and Accountants

A 2019 Global Report by Webexpenses and The Association of Certified Accounts Payable Professionals (ACAPP) found that for two thirds of businesses, invoice processing alone took upwards of five days each month. E-invoicing is a valuable time-saving solution, offering streamlined convenience far beyond its paper counterpart.

E-invoicing can greatly reduce the risk of human error, leading to a more secure experience for businesses and accountants. For example, errors in sequencing and duplication of numbering, as well as incorrect cancellation or archiving of documents can be minimised, potentially saving a great deal of time and stress. Some modern e-invoicing applications also use integrated AI to provide suggestions for (or automated) bookkeeping, making the whole process much more effortless and organised for accountants and clients alike.

When e-invoices are sent digitally, the potential of them getting lost in transit or sent to the wrong address is also drastically reduced. And by eliminating the need for paper and postage, it is a more environmentally friendly method of accounting. In practice, e-invoicing can also save valuable desk and filing space for businesses.

In Summary, the key Benefits of E-invoicing are:

• Saving time and energy.
• Reducing the risk of human error.
• Improving security.
• Reducing the chance of invoices getting lost.
• Being more environmentally friendly.
• Saving physical archive space.
• Allowing for effortlessly organised bookkeeping.

Security Measures for E-Invoicing in Bulgaria

As with any system for businesses, there are vital security measures and regulations to consider when introducing e-invoicing. For example, e-invoices must meet the legal requirements of article 7 of the Civil Code (C), and articles 114 and 115 of the Law on Value Added Tax (VAT).

It is also important to note that an e-invoice being sent digitally does not automatically make it an electronic document that must be signed with an electronic signature. When an e-invoice is issued, it is accepted as a technical carrier of information (like a PDF file), which can then be printed to a hard copy.

Therefore, according to Bulgarian legislation, no seal or signature is required when issuing an e-invoice (just like a paper invoice). However, the Accounting Law states that while not mandatory, an invoice can be issued as an electronic document. If a business chooses to do so, it must be issued in accordance with the Electronic Document and Electronic Signature Law.

While there are no industry specific considerations for e-invoicing in Bulgaria, it is important to stay informed on Bulgarian requirements for invoicing (e.g. including invoice number, date of invoice, client name and address, payment due date etc.) An accountant can offer up to date guidance on current best practices in this respect.

Moving From Paper to E-invoicing in Bulgaria

Transitioning from paper to e-invoicing is fairly simple and will save you countless admin hours in the long run. You will need to choose an invoicing application that works for you. In Bulgaria, some of the most popular invoicing applications are inv.bg, e-faktura and invoicepro.bg.

Because a common structured system has not been implemented in Bulgaria, e-invoices cannot yet be automatically processed using these systems. This is where an accountant can help. An experienced accountant can work with different invoice pre-booking applications and accounting software, developing export and import files that allow invoices to be processed swiftly and semi-automatically.

How Leinonen Accounting in Bulgaria can Help

Due to the lack of a common system, e-invoicing in Bulgaria can be a little more complicated to set up for maximum efficiency. Therefore, it is important to have an accountant by your side that is familiar with navigating Bulgarian regulations. If your company deals with a lot of documents, moving to e-invoicing could make your life a lot easier.

Using an OCR-recognised application with AI integration for automatic invoice pre-booking, Leinonen can completely eradicate the need for paper invoicing. Using this system, our experienced accountants have already helped numerous clients discover simpler and more accurate invoicing processes.

Accounting in Bulgaria is fast changing, and as e-invoicing steadily becomes the norm, we will help you reap every benefit at the earliest possible opportunity.

To find out how Leinonen can transform your business’ invoicing process with e-invoicing, get in touch and arrange a consultation today.

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Leinonen shares the same values as the chairman Levon Hampartzumyan said at the opening speech – business ethics, responsible and sustainable business development, and success achieved through compliance.

https://www.bblf.bg/bg/sabitiya/1808/bfbl-otbelyaza-svoyata-25-godishnina

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The reduction in tax base for parents who meet the requirements for tax benefit for 2023 and the amounts parents can claim are as follows:

• BGN 600 for one minor child – tax base decrease with up to BGN 6,000;
• BGN 1,200 for two minor children – tax base decrease with up to BGN 12,000;
• BGN 1,800 for three or more minor children – tax base decrease with up to BGN 18,000;

For underage children with disabilities, the amount to be received is up to BGN 1,200 – tax base decrease with up to BGN 12,000;

The tax relief can be used up to the amount of the annual tax bases under Art. 17 of the Personal Income Tax Act and provided that the other parent will not use the reduction for 2023 tax year.

When the amount of the tax relief is higher than the sum of the annual tax bases, the difference can be used by the other parent, by submitting an annual tax return under Art. 50 from PIT Act.

Child tax credits can be claimed in the following ways:

• Through the employer: between November 30 and December 31, 2023, parents must submit to their employer the declarations for the use of tax relief for children under Art. 22c, para. 8 of the PIT Act, resp. according to Art. 22d, para. 7 of PIT Act (for children with disabilities).
• Independently from the parents by submitting the annual tax return under Art. 50 from PIT Act until 30.04.2024

For further questions please don’t hesitate to contact Leinonen Bulgaria team.

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To effectively navigate the Bulgarian logistics landscape, it is essential to have a solid understanding of the country’s accounting practices, as well as its regulatory framework. This article dives into the field of accounting within the logistics industry, drawing on valuable insights from Leinonen Bulgaria.

Regulation for International Carriage of Passengers and Cargo in Bulgaria

Bulgaria’s normative acts to road transport are in alignment with European Union regulations. These include the Road Transport Act, Ordinance № 11 of 31.10.2002 for the international carriage of passengers and goods, and Council Regulation (EEC) No 881/92 of 26 March 1992 and No 1071/2009.

Various authorities, such as traffic police, customs, and the Ministry of Transport, enforce these regulations. It is important for foreign road carriers to ensure compliance with these regulations while operating in Bulgaria.

Issuing Community licences to road hauliers in Bulgaria:

The competent authority in Bulgaria – Executive Agency “Road Transport Administration”  issue the Community licence for renewable periods of up to five years. The licence is issued on the name of the haulier and is non-transferable.

Community license shall be issued to haulers who meet the requirements for:

• reliability (reputation);
  Requirements reliabilities are met when transport managers of sole traders and companies have not been convicted for intentional offenses under the Criminal Code or deprived of a conviction the right to exercise the transport activity.

• professional competence;
  Prove for professional competence is when the transport manager has Driver Certificate of Professional Competence (Driver CPC) and minimum secondary education.

• Financial Stability – Fs ≥ 1;
  Financially stable within the meaning of the regulation is a person/entity that has sufficient resources that can guarantee the normal startup and the operation of the transport undertaking in the amount of € 9,000 for the first vehicle, for each subsequent truck – amounting of € 5,000. If the amount of own funds capital of the carrier fail to prove their financial stability, the insurance contract or bank guarantee can be concluded accordingly issued to prove their financial stability.

• Place of establishment in Bulgaria – declaration under provision of Regulation EO Nr. 1071/2009 for:
• Rent office contract if you do not own office place.
• Maintenance contract with a garage and agent to do safety inspections and repair vehicles if you do not do this yourself.

The fee to apply for a Community license is 250 EUR. The legal deadline for issuing the Community license is within 15 calendar days from the date of application.

Foreign carrier’s documents:

• EU Licence, European Conference of Ministers of Transport  (ECMT) Authorisation, Bilateral or Transit Transport Authorisation; Authorisation for non liberalised passenger transport services;
• ADR permit.

Driver’s Documents (foreign vehicles):

• Proof of ID;
• Driving permit;
• AETR record sheet, tachograph discs, digital tachograph;
• ADR training certificate;
• Employment certificate.

Foreign vehicle’s documents:

• Registration certificate (grey card);
• Regular technical inspection;
• ECMT technical certificate;
• Compulsory nationality plate;
• ADR certificate of approval;
• ATP certificate of compliance;
• Hire or leasing contract.

Transport documents on board (foreign vehicles):

• Consignment note / CMR international consignment note;
• Loading list (groupage);
• ADR transport document, consignor’s declaration, ADR security instructions;
• Container packing certificate;
• Transfrontier movement of waste document (Basel Convention)

Working force: drivers

The backbone of any successful transport company is its drivers. In Bulgaria, drivers obtain their professional driving licenses from accredited driving centers, subject to meeting specified requirements outlined in the Law for Road Transportation.

Driver qualifications are crucial, with official diplomas and certificates being recognized by transport companies, particularly in the handling of dangerous goods (ADR). Due to a shortage of professional drivers in Bulgaria, companies may consider employing drivers from neighboring countries. This process typically takes around 3 months and requires a work permit issued by the Ministry of Internal Affairs.

Accounting and payroll related to transport field.

General obligatory social fees in Bulgaria for drivers are the following:

Maximum monthly amount of the insurable income during 2023 – 3 400 BGN

Personal Income tax – 10 %

Average salary for international drivers employed in Bulgaria is around 1 500 – 2 000 EUR including paid diem, compensations and bonuses.

Accounting specific tasks:

• Industry specific Licences and certificates processing and booking
• VAT refunding from other EU countries
• Booking of assets and trucks depreciation plan
• Tracking fuel consumption
• Costs allocation  to transport rates
• Processing of prime documents for posting of drivers
• Pety-cash for drivers

In summary, Bulgarian logistics sector, with its strategic location and infrastructure, offers a promising landscape for businesses in the transport industry.

Navigating the regulatory and accounting aspects is crucial for success. By leveraging the insights from Leinonen Bulgaria, businesses can make informed decisions in this dynamic market. For tailored advice and further information, reach out to Albena Stoyanova, Country Manager at Leinonen Bulgaria.

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The Bulgarian Business Leaders Forum unites organizations with shared values that develop their business in a responsible, transparent and ethical manner. This is a platform for exchanging good practices and ideas for the development of the business and social environment in Bulgaria. The Leaders Forum engages and works with key figures from politics, business, diplomacy, the non-governmental sector and the media to transform society together.

*On the photo, the chairman of the BBLF, Levon Hampartzumyan, presents the membership plaque to Albena Stoyanova – Country Manager of Leinonen Bulgaria

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• Salary payment from Employers with more than 100 employees;
• Cash payment of dividends exceeding 1 000 BGN

Reporting of cash availability and receivables to owners and staff

Amendments in State Budget Act 2023 introduces new reporting obligations to VAT registered persons under Accountancy Act.

The obligation occurs when the total amount of cash available in hand and the amount of receivables (including from granted loans) from owners, natural persons, workers, employees, persons employed under a management and control contract, and accountable persons exceeds BGN 50,000.

Starting from 1.07.2023, cash availability is to be reported quarterly.

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From 1st October 2023, mandatory declaration of transport of high tax risk goods to the National Revenue Agency is introduced in the following cases:

• In case of intra-community purchases;
• In case of intra-community deliveries.

From 1.01.2024, mandatory reporting obligations will be extended in the following cases:

• Between two locations within Bulgaria;
• In case of imports;
• In case of export exports;
• Relating to intra-community transactions where goods are in transit in Bulgaria.

The road vehicle categories to be monitored in the Bulgarian system are those with a maximum load capacity at least 3.5 tons, shipping of high tax risk goods between different legal entities. Monitoring is related to high tax risk goods intended of delivery for each individual commercial transaction with a weigh up to 500 kg and/or the value of the goods is up to BGN 5,000 excluding VAT.

A person who fails to fulfill an obligation under Art. 127i, para. 1 – 5, shall be punished with a fine – for individuals, or with a pecuniary sanction – for legal entities and sole traders in the amount of 40 percent of the tax base of the transported goods in the sense of VAT, but not less than BGN 5,000.

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