{"id":3526,"date":"2026-04-13T09:02:00","date_gmt":"2026-04-13T09:02:00","guid":{"rendered":"https:\/\/new.leinonen.eu\/bgr\/?p=3526"},"modified":"2026-04-20T13:49:50","modified_gmt":"2026-04-20T13:49:50","slug":"payroll-in-bulgaria","status":"publish","type":"post","link":"https:\/\/leinonen.eu\/bgr\/news\/payroll-in-bulgaria\/","title":{"rendered":"Employment and Payroll in Bulgaria"},"content":{"rendered":"\n<p>Boasting a business-friendly environment, seamless access to the European market and a competitive tax system, Bulgaria is fast emerging as an <a href=\"https:\/\/www.ilflaw.com\/publications\/5-compelling-reasons-to-open-a-company-in-bulgaria\/\" target=\"_blank\" rel=\"noreferrer noopener\">EU business leader<\/a>. What&#8217;s more, since joining the Schengen zone on 1 January 2025 and adopting the euro on 1 January 2026, Bulgaria has further strengthened its position as a destination for foreign-owned businesses, combining free movement of people and goods with the stability of a single currency.<\/p>\n\n\n\n<p>In this article, Leinonen Bulgaria will provide a comprehensive overview on managing payroll in Bulgaria as a foreign-owned business.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Payroll Calculation Procedure in Bulgaria<\/h2>\n\n\n\n<p>All employment relations are handled by the Labour Code. Other Acts related to employment legal requirements are the Healthy and Safe Working Conditions Act, Employment Promotion Act, and some ordinances and regulations.<\/p>\n\n\n\n<p>The monthly payroll calculation procedure consists of the following steps:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Calculations of all employees\u2019 monthly working and sick days<\/li>\n\n\n\n<li>Summing up the gross salary with bonuses and other benefits added<\/li>\n\n\n\n<li>Generating printouts after doing the necessary deductions<\/li>\n\n\n\n<li>Sending the payroll file, social insurance payment orders and, if necessary, salary payment orders to the employer<\/li>\n\n\n\n<li>Filing two extra declarations with the National Revenue Agency (NRA)<\/li>\n<\/ol>\n\n\n\n<p>In case of illness after the declarations have been submitted, the sick leave list must be prepared and submitted no later than the 10<sup>th<\/sup> of the following month after receiving it.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Salary in Bulgaria<\/h2>\n\n\n\n<p>Bulgaria has a government-mandated minimum wage. As of 1 January 2026, it stands at \u20ac620.20 per month, an increase of 12.6% compared to 2025. This translates to an hourly rate of \u20ac3.74, based on a standard eight-hour workday and five-day workweek. The minimum rates apply to everyone, regardless of age, industry, or experience.<\/p>\n\n\n\n<p>Additionally, depending on the industry and occupied position, the law provides minimum social security thresholds. This means that even if the agreed salary is at minimum wage, social security instalments are calculated and based on the applicable minimum threshold.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">National Insurance Contributions in Bulgaria<\/h2>\n\n\n\n<p>National insurance contributions include social security and health insurance. This system guarantees financial protection against major life risks, work-related accidents and consequences like disease or unemployment, as well as old age and nursing care needs for employees.<\/p>\n\n\n\n<p>The social insurance regulations are all gathered into a single legal act called the Social Insurance Code (SSC). The aim of the social security system in Bulgaria is to provide everyone with a stable standard of living.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">The Bulgarian social security system covers the following risks:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>General disease<\/li>\n\n\n\n<li>Work-related accidents<\/li>\n\n\n\n<li>Maternity<\/li>\n\n\n\n<li>Unemployment<\/li>\n\n\n\n<li>Old age<\/li>\n\n\n\n<li>Death<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Social Security and Health Insurance Rates<\/h3>\n\n\n\n<p>Social security is mandatorily paid on employees\u2019 gross income, starting at a rate of 32.7% and rising to 33.4% depending on occupational category and risk profile. Employers contribute 18.92%-19.62%, while employees contribute 13.78% of their <a href=\"https:\/\/www.lano.io\/global-payroll-guide\/bulgaria\" target=\"_blank\" rel=\"noreferrer noopener\">gross income<\/a>.<\/p>\n\n\n\n<p>The <a href=\"https:\/\/www.lano.io\/global-payroll-guide\/bulgaria\" target=\"_blank\" rel=\"noreferrer noopener\">payments are split<\/a> as follows:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Social security at between 24.7% and 25.4% (employer pays 14.12%-14.82%, employee pays 10.58%)<\/li>\n\n\n\n<li>Health insurance at a fixed rate of 8% (employer pays 4.8%, employee pays 3.2%)<\/li>\n<\/ul>\n\n\n\n<p><a href=\"https:\/\/remotepeople.com\/countries\/bulgaria\/hire-employees\/payroll-tax\/\" target=\"_blank\" rel=\"noreferrer noopener\">Summary of Contribution Rates<\/a><\/p>\n\n\n\n<figure class=\"wp-block-table is-style-stripes\"><table class=\"has-fixed-layout\"><thead><tr><th><strong>Social security contribution<\/strong><\/th><th><strong>Paid by employer<\/strong><\/th><th><strong>Paid by employee<\/strong><\/th><th><strong>Total<\/strong><\/th><\/tr><\/thead><tbody><tr><td>Health insurance fee<\/td><td>4.8%<\/td><td>3.2%<\/td><td>8%<\/td><\/tr><tr><td>Pension fee<\/td><td>8.22%<\/td><td>6.58%<\/td><td>14.8%<\/td><\/tr><tr><td>Unemployment fee<\/td><td>0.6%<\/td><td>0.4%<\/td><td>1%<\/td><\/tr><tr><td>Common disease and maternity<\/td><td>2.1%<\/td><td>1.4%<\/td><td>3.5%<\/td><\/tr><tr><td>Supplementary compulsory pension<\/td><td>2.8%<\/td><td>2.2%<\/td><td>5%<\/td><\/tr><tr><td>Professional disease, labour accident insurance<\/td><td>0.4%-1.1%<\/td><td>n\/a<\/td><td>0.4%-1.1%<\/td><\/tr><tr><td><strong><mark style=\"background-color:rgba(0, 0, 0, 0);color:#884098\" class=\"has-inline-color\">Total<\/mark><\/strong><\/td><td>18.92%-19.62%<\/td><td>13.78%<\/td><td>32.7%-33.4%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>As of April 2026, the maximum monthly insurable income for all insured persons is \u20ac2,111.64, carried over from 2025 under transitional rules pending adoption of the 2026 State Budget. The minimum insurance income depends on the group of economic activities and professions, and is established annually by the Public Social Insurance Budget. For labour categories I and II (heavy and dirty working conditions), contribution percentages are higher for both employees and employers.<\/p>\n\n\n\n<p>According to Bulgarian legislation, an additional 0.6% of gross salary is charged for each year of an employee\u2019s professional experience. Cost to Company (CTC) therefore includes not only gross salary and employer social security contributions, but also this supplement. Director\u2019s fees are treated with the same taxation and social contributions as under employment contract.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Social Security for Foreign Workers<\/h3>\n\n\n\n<p>Foreigners could be exempt from social security contributions in Bulgaria, or their contributions paid in Bulgaria could be recognised in their home country under applicable social security treaties.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Social Security for Self-Employed Persons and Freelancers<\/h3>\n\n\n\n<p>Based on their annual income, self-employed persons are responsible for the entire social and health security charge. The maximum threshold is the same as under an employment contract, namely \u20ac2,111.64. As of 2026, the minimum monthly insurable income for self-employed individuals is \u20ac550.66, with the actual base depending on declared annual income. Concealment of mandatory social contributions in large amounts is criminalised.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Social Security for Posted Workers<\/h3>\n\n\n\n<p>EU Regulation 883\/2004 on social security applies to Bulgarian workers who are posted in another EU Member State, and foreign workers seconded to Bulgaria from another EU Member State. In both cases, workers may remain under their home social security legislation if the working period is less than two years.<\/p>\n\n\n\n<h1 class=\"wp-block-heading\">Employment in Bulgaria<\/h1>\n\n\n\n<h2 class=\"wp-block-heading\">Working Hours<\/h2>\n\n\n\n<p>The standard working week in Bulgaria is eight hours per day over a 40 hour (five day) week.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Some alternatives include the following:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>An extended 48 hour work week, but only if limited to 60 work days annually (a maximum of 20 days consecutively)<\/li>\n\n\n\n<li>A reduced 6-7 hour work day for those working in conditions that pose a risk to life or health<\/li>\n\n\n\n<li>Unspecified working time for some positions (determined by the employer)<\/li>\n\n\n\n<li>Work in shifts<\/li>\n\n\n\n<li>Overtime, although it is not permitted in principle<\/li>\n\n\n\n<li>Part-time work for a minimum of 4 hours a day, with a working time reduction never exceeding half of the regular working time and not for more than 3 months annually<\/li>\n\n\n\n<li>Flexible scheduled work, where the employee spends a specified period of time (e.g., 9am-1pm) at the workplace, after which they are free to decide how, where and when they should complete the remainder of their working time<\/li>\n<\/ul>\n\n\n\n<p>For flexible scheduled work, the manner of timekeeping should be specified in the employer\u2019s internal labour rules. Employees can choose to refuse standard arrangements if an agreement is reached with the employer.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Working Hours for Minors<\/h3>\n\n\n\n<p>A minor\u2019s weekly working time must not exceed 40 hours, and work days should be reduced to 6-7 hours.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Overtime<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Overtime in Bulgaria cannot constitute more than:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>150 hours per year<\/li>\n\n\n\n<li>30 hours (or 20 night hours) per month<\/li>\n\n\n\n<li>6 hours per day<\/li>\n\n\n\n<li>4 hours per night<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Overtime pay rates are:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>150% on working days<\/li>\n\n\n\n<li>175% during holidays<\/li>\n\n\n\n<li>200% on public holidays<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Rest Breaks<\/h2>\n\n\n\n<p>In Bulgaria, the employee is not obligated to perform work during periods of rest \u2013 the rest period should serve recreational purposes.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">The following rest breaks are required in Bulgaria:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A lunch break during the workday that cannot be shorter than 30 minutes<\/li>\n\n\n\n<li>A rest period after the end of the working day of no less than 12 hours<\/li>\n\n\n\n<li>Weekly rest periods of 2 consecutive days (48 hours) in a 5 day working week<\/li>\n\n\n\n<li>Holidays<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Vacations<\/h2>\n\n\n\n<p>The Bulgaria Labour Code specifies that all employees should be granted a minimum paid leave of 20 working days. In case of an agreement between the parties involved, paid annual leave can be longer, but never shorter. Before being entitled to annual paid leave, the employee must work for a minimum of eight months.<\/p>\n\n\n\n<p>Annual paid leave days should be used within the calendar year they are earned in. In some cases, unused paid leave days can be transferred to the next calendar year, but they should be used by the middle of said year. Unused paid leave days can be subject to compensation, but only in the case of employee termination.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Public Holidays<\/h2>\n\n\n\n<p>When calculating annual paid leave, public holidays should not be counted. The remuneration for work performed during public holidays must amount to not less than twice the amount of remuneration that would ordinarily be paid, calculated on a daily basis.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Illness and Sick Leave<\/h2>\n\n\n\n<p>For the first three days of sick leave, the employer must cover 70% of the employee\u2019s wages. The rest of the sick leave is covered by the National Social Security Institute after the employee submits the appropriate documents.<\/p>\n\n\n\n<p>An obligatory six months of work (and social security payments) must be completed before the employee is eligible for sick leave compensation, unless the sick leave is due to a work accident or professional illness, or if the employee is a minor.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Sick leave or injury compensation is either:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/boundlesshq.com\/guides\/bulgaria\/leave\/\" target=\"_blank\" rel=\"noreferrer noopener\">80% of the average daily gross salary<\/a> for common diseases<\/li>\n\n\n\n<li><a href=\"https:\/\/smartpeople.bg\/changes-to-social-security-income-thresholds-in-bulgaria-for-2025\/\" target=\"_blank\" rel=\"noreferrer noopener\">90% of the average daily gross salary <\/a>for a labour accident or professional illness<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Maternity Leave<\/h2>\n\n\n\n<p>Paid maternity leave at 90% of the mother\u2019s salary is granted up to 410 days, 45 of which should be taken during the last stage of pregnancy. Fathers are entitled to 15 days of paid leave from the date of childbirth. Care of the child may be transferred to the father when the child reaches six months of age. In this case, the father shall receive benefits for the remainder of the 410 days.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Termination of Employment<\/h2>\n\n\n\n<p>Employment in Bulgaria can be terminated with a one, three, or six month notice (depending on the contract). After termination, the employee receives all the necessary documents, including certificates for income tax and social security payments. Since 1 June 2025, the paper labour book has been replaced by the Unified Electronic Employment Record, maintained by the National Revenue Agency. Employers must finalise and return any remaining paper labour books to their employees no later than 1 June 2026, after which the electronic register serves as the official record of employment history.<\/p>\n\n\n\n<p>The National Revenue Agency (NRA) must be notified of the termination within seven days of it coming into effect, by way of a standard form that specifies the details of the termination. If the employer fails to notify the NRA in due time, they may be subject to a fine of up to \u20ac7,670 (BGN 15,000) per violation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Contact Leinonen Bulgaria for More Support<\/h2>\n\n\n\n<p>With 18 years specialising in supporting foreign-owned businesses in Bulgaria, Leinonen team holds valuable local knowledge to help your business prosper. <a href=\"https:\/\/leinonen.eu\/bgr\/contacts\/\" target=\"_blank\" rel=\"noreferrer noopener\">Get in touch<\/a> today to make sure your foreign-owned business in Bulgaria stays firmly in line with the latest accounting, tax, and payroll regulations.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Boasting a business-friendly environment, seamless access to the European market and a competitive tax system, Bulgaria is fast emerging as an EU business leader. What&#8217;s more, since joining the Schengen zone on 1 January 2025 and adopting the euro on 1 January 2026, Bulgaria has further strengthened its position as a destination for foreign-owned businesses, [&hellip;]<\/p>\n","protected":false},"author":26,"featured_media":4461,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[1],"tags":[],"coauthors":[114],"class_list":["post-3526","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Employment and Payroll in Bulgaria &#8211; Leinonen Bulgaria<\/title>\n<meta name=\"description\" content=\"In this article, Leinonen Bulgaria\u2019s accounting, tax and payroll experts take a deep dive into payroll in Bulgaria for foreign-owned businesses.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/leinonen.eu\/bgr\/news\/payroll-in-bulgaria\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Employment and Payroll in Bulgaria &#8211; 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