Tax and Social Insurance Procedure Code
Tax and social insurance code, (last amended December 2016/extract)
Tax and social insurance code – Article 1. This Code shall set out proceedings for the ascertainment of obligations for taxes and compulsory social-insurance contributions, as well as for securing and collecting public claims, assigned to the revenue authorities and public enforcement agents.
Tax and social insurance code
Powers of Revenue Authority and Public Enforcement Agent
Tax and social insurance code – Articl. 12. (1) Observing the provisions of this Code, the revenue authority shall:
1. conduct examinations (checkups) and audits (inspections) ;
2. ascertain administrative violations;
3. impose administrative sanctions;
4. have right of access to the facilities subject to control;
5. check the accounts of the facilities controlled;
6. check accounting, business or other papers, documents and data mediums with a view to ascertaining obligations and liabilities for taxes and compulsory social-insurance contributions, as well as establishing any violations of the tax and social-insurance legislation;
7. require and collect original documents, data, information, papers, items of property, statements of account, information sheets and other data mediums for the purpose of ascertaining obligations and liabilities for taxes and compulsory social-insurance contributions, and establishing any violations of the tax and social-insurance legislation; require certified copies of written documents and certified printouts of data from machine-readable data mediums;
8. require that the persons control declare their bank accounts in the country and abroad;
9. establish the properties, financial resources and tangible assets owned, claims and securities held;
10. perform the steps provided for in this Code to perpetuate evidence, including the sealing of safes, warehouses, workshops, office premises, shops and other facilities subject to control;
11. require from all persons, central-government and municipal authorities to provide data, information, documents, papers, materials, items of property, statements of account, information sheets and other data mediums as are necessary for the performance of control activities;
12. request the disclosure of official, bank or insurance secrets according to a procedure provided for by a law;
13. gain, at no charge, access to public registers and the issuance, at no charge, of officially certified abstracts of the records therein or of copies of the documents on the basis of which the said records have been made;
14. require written explanations;
15. assign expert examinations and use the services of experts;
16. require the declaring of certain facts and circumstances, where this is provided for by a law.
Obligations of Participants in Proceedings
Tax and social insurance code – Artic. 13. (1) Participants in the proceedings shall be obligated to cooperate and to provide information under the terms and according to the provisions established by this Code, to a revenue authority and a public enforcement agent upon discharge of the powers thereof covered under Article 12 (1) to (4) herein.
Obligated Persons’ Rights
Tax and social insurance code – Arti. 17. (1) Obligated persons shall have the right to:
1. respect for their dignity and honour in the implementation of procedural steps under this Code;
Establishment and Calculation of Time Limits
Tax and social insurance code – Art. 22. (1) The time limit in an administrative proceeding shall be fourteen days, unless established by the law or set by the revenue authority or the public enforcement agent, as the case may be. The revenue authority and the public enforcement agent may not determine a time limit shorter than seven days.
(7) Where a time limit expires on a non-business day, the said shall not count and the time limit shall expire on the next succeeding business day.
Mailing Address (address for correspondence)
Tax and social insurance code – Ar. 28. (1) The mailing address shall be:
1. the permanent residence address: applicable to natural persons, unless another address has been named in writing, and, applicable to persons recorded in the BULSTAT Register, the mailing address entered in the register and, applicable to sole traders, the address of the place of management;
2. the address of the place of management: applicable to resident legal persons, registered representative offices and branches of non-resident persons, unless another mailing address has been entered in the BULSTAT Register and, respectively, unless another address of the place of management has been entered in the Commercial Register;
3. the address of the place where the activity or the management is carried out, if there is no address under Item 2: applicable to non-resident persons carrying on business in the country through a permanent establishment or a fixed base; where the non-resident person implements business through more than one permanent establishment in this country, the mailing address shall be the address where the activity of the first emerged permanent establishment or fixed base is carried out;
Obligation to Store
Tax and social insurance code – Art. 38. (1) Accounting and commercial information, as well as all other data and documents of relevance to taxation and social-insurance contributions, shall be stored by the obligated person according to the procedure established by the National Archives Stock Act within the following periods:
1. payrolls: fifty years;
2. ledgers of accounts and financial statements: ten years;
3. tax and social-insurance control documents: five years after expiry of the period of prescription for extinguishment of the public obligation whereto they refer;
4. all other mediums: five years.
Article 45. (1) Where a proceeding under this Code has been initiated, the revenue authority may cross-check to establish specific facts and circumstances related to a person who or which is not a party to the relevant proceeding. No obligations and liabilities for taxes and compulsory social-insurance contributions of the person examined shall be ascertained upon a cross-check. A copy of the memorandum shall be served on the auditee together with the audit report.
Documents in Foreign Language
Article 55. (1) Upon request of a revenue authority, the subject shall be obligated to submit a document drafted in a foreign language accompanied by an accurate translation into the Bulgarian language executed by a sworn translator.
(2) In cases where the document is not submitted accompanied by an accurate translation within the prescribed time limit, the revenue authority may have the translation executed for the account of the subject.
(3) The time limit for completion of the relevant proceeding shall cease to run from the date of a written request referred to in Paragraph (1) until the date of submission of the translation.
Submission and Acceptance of Documents by Electronic Means
Article 102. (1) The submission of any returns, documents or data by electronic means shall be effected by the subject or a representative thereof using a qualified electronic signature or a personal identification code, issued by the National Revenue Agency.
(2) Upon acceptance of any returns, documents or data submitted by electronic means, an incoming reference number shall be assigned automatically, and the said number and date shall be sent to the submitter by means of an electronic message.
Audits (inspections) and Examinations (checkups)
Article 110. (1) The revenue authorities shall exercise tax and social-insurance control by means of conduct of audits and examinations.
(2) An audit (inspection) shall be a totality of steps by the revenue authorities intended to ascertain obligations for taxes and compulsory social-insurance contributions.
(3) An examination (checkup) shall be a totality of steps by the revenue authorities regarding the observance of tax and social-insurance legislation. Certain facts and circumstances of relevance to the ascertainment of obligations for taxes and compulsory social-insurance contributions may be established by means of an examination. Obligations for taxes and compulsory social-insurance contributions may not be established by means of an examination.
(4) An examination shall be conducted by the revenue authorities without the need of an express written assignment. The rules under Article 8 herein shall not apply where there is assignment by the Executive Director or a person authorized thereby. A memorandum on the result of the examination shall be drafted where the instrument whereby the examination must be completed is not provided for by a law.
Time Limit for Conduct of Audit
Article 114. (1) The time limit to conduct an audit shall not exceed three months and shall commence from the date of service of the assignment order. When the audit assignment order is served as per the procedure laid down in Article 143l (1), the time limit to conduct the audit shall commence from the date of receipt of a notification that an instrument has been served by the competent authority of another European Union member state.
(2) If the time limit referred to in Paragraph (1) proves insufficient, the said time limit may be extended by up to two months by an order on extension of the time limit by the authority that had assigned the audit.
(4) Where the time limits referred to in Paragraphs (1) and (2) prove insufficient owing to a particular factual complexity of the specific case, the time limit may be extended by an aggregate not exceeding three years by an order on extension of the time limit by the Executive Director, issued acting on a reasoned motion by the Territorial Director.
Enforcement of Audit Instrument
Article 127. (1) The obligation ascertained by an audit instrument shall be subject to voluntary payment within fourteen days after service of the instrument.
(2) After expiry of the time limit referred to in Paragraph (1) the audit instrument shall be subject to coercive enforcement, unless the enforcement has been suspended according to the procedure established by this Code.
For any not paid on time duties and/or taxes an interest is due. This interest is determined in the Bulgarian Tax and Social Insurance Procedure Code. Art. 175 says:
Article 175. (1) Interest (Legal Interest) at a rate determined in the applicable law shall be due on any public obligations which are not paid within the statutory time limits.
The legal Interest rate in Bulgaria is determined by Council of Minsters Decree nr. 100 dated 29 May 2012, and for BGN it is: the basic interest rate of Bulgarian Nat bank as of 1st January, respectively 1st July each year plus 10%.
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