Transfer taxes
Apart from corporate tax (currently 15%), no other direct taxes are levied on the transfer of real property. The transfer is, however, subject to notary and municipal fees. The notary fees are paid on the higher of the market price or the book value of the property at varying rates, with the maximum being BGN3,500 (about EUR1,750). In addition, 2% of the market value of the property is paid to the municipality in which the real property is situated upon completion.
Capital Gains Tax
There is no Capital Gains Tax on the profit when a company sells the property, but the standard rate of corporate tax is applicable (currently 15%).
Local taxes and rates
The owner of a building or a plot is obliged to pay a real property tax. Where a building is built on a State or municipal plot, the value of the plot will also be included in the tax base. The tax is equal to 0.15% of the book value of the property. Arable land is exempt from local taxes. In addition to the real property tax, owners also pay waste-collection fees.
Value Added Tax
Transactions with land and lease of property for residential purposes are exempt from VAT (Value Added Tax). All other real estate transactions are subject to VAT at the uniform rate of 20%. The buyer/lessee is entitled to a VAT refund, provided that it is registered for VAT purposes.