VAT registration, VAT compliance
VAT registration. VAT compliance. Are you sure that working on your monthly VAT Return is the best way to spend your time???
We believe that primarily you are in the business to make money. SKM can help you to make more by leaving you more time for your core business. Just transfer your Value Added Tax processing burdens to us.
You could rely on SKM for the following VAT services:
- Advising on whether do you need or not such registration in Bulgaria;
- VAT registration and deregistration;
- Calculation of the amount of of this tax – payable or repayable;
- Preparation and filing of VAT return and VIES declarations (purchase and sales list) to Bulgarian National Revenue Agency;
- Support during Value Added Tax audits and checks;
- Managing your monthly tax payments;
- Preparation of specialised Value Added Tax consultations.
Value Added Tax is not only the most important indirect tax but also the most complicated one. Ir-respectively that we are sharing almost one and the same tax system in the EU these days, every country has its specific requirements and rules, and it is essential for you to comply with the Bulgarian ones. Failure to do so usually leads to serious financial penalties and interest charges. SKM shall manage all your VAT return and needs. Just contact us.
Some useful VAT info in brief.
If you are making distant sales. If you are making distant sales using Internet to unregistered individuals (physical persons) in Bulgaria, and your turnover is reaching BGN 70 000 during the last 12 months you have to apply for VAT registration in Bulgaria. Please note that you should apply for this VAT registration a month before you reach above threshold.
If you are an EU based business you may apply for VAT registration in Bulgaria by your own, directly. If you are not EU based business you should apply for VAT registration only through so called Accredited Representative (Fiscal Agent). Direct registration is not possible. In both cases you can rely on SKM. Just contact us.
If you are already VAT registered in Bulgaria and you will have to issue / raise your first invoices to your Bulgarian customers you should comply with the following rules:
- Every invoice should have BG number starting from 0000000001. Next year the numbers continue chronologically but do not start from 0000000001;
- It is not possible to skip or double a number;
- Every invoice should contain the tax base and VAT in BGN (Bulgarian lev) – in addition to the primary currency – Euro or else. The applied exchange rates should respond to the date of the invoice. You can find the needed ex-rate from the site of our Nat Bank by clicking here;
- Every invoice should include your BG VAT number as well the VAT number of your client;
- Credit and Debit notes are following the numbering of the invoices;
- Invoices, credit and debit notes have to state the grounds of accounting or not accounting the tax;
- Invoices, credit and debit notes can be produced and processed primary in your native language, but if there is a tax inspection (audit / check) at certain point our NRA can ask all these to be translated into Bulgarian;
- Every intercommunity acquisition should be documented by issuance of a VAT protocol. This is mandatory. The date of the protocol should be no later than 15 days after the date of the taxable event;
- Value Added Tax protocols have their own numbering and they start from 0000000001. No omissions or duplications in the numbering are allowed.
Terms of submission / filing and paying the tax. The VAT return is to be filed and due VAT payments are to be made before 14th, every month. If 14th falls during weekends or national holidays we strongly recommend you to file and pay the due VAT before these days. We don’t have annual returns in Bulgaria.
Right of exercising of tax credit. You have the right to exercise tax credit deduction for the tax period, during which this right has arisen, or in one of the subsequent 12 months. This gives you good flexibility to plan and manage your cash flow.
Refunding / reimbursement of VAT. Recuperating of this tax may be effected on the initiative of our NRA or by you, by staying on tax credit position for 3 consequent months. Normally our NRA nominates an audit or inspection / examination before any VAT refund.
Some penalty warnings!
Not submitting application for VAT registration on time. The art. 178 from our Value Added Tax Act defines that if you do not submit your registration application to our NRA on time you shall be punished with fine in extend from 500 to 5 000 BGN.
Not submitting VAT return on time. The art. 179 para. 1 from our Value Added Tax Act defines that if you do not submit your tax return in the provided terms you will be punished with fine in extend from 500 to 10 000 BGN.
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%.