VAT Changes in Bulgaria 2026: What Businesses Need to Know

Effective from 2026 | State Gazette, Issue 115, 30 December 2025

VAT changes Bulgaria 2026 came into force on 1 January 2026, directly affecting accounting practices and VAT returns for companies operating in Bulgaria. Published in State Gazette, Issue 115, dated 30 December 2025, these amendments transpose European directives into national law.

These changes have a direct impact on the processes of accounting services and VAT registration in Bulgaria — both for local companies and for foreign entities with activities on Bulgarian territory.

Below we outline the three amendments with the greatest practical significance.

Virtual and Online Events — Place of Supply Shifts to the Customer’s Location

What Changed
This is one of the most significant VAT changes Bulgaria 2026 introduces for businesses receiving cross-border digital services. Until the end of 2025, the place of supply for services related to access to cultural, educational, sporting, scientific, or entertainment events was the location where the event physically took place.
From 2026, this rule has changed for virtual and online events. When such a service is provided virtually to a taxable person — a webinar, online conference, virtual exhibition, or similar event — the place of supply is where the recipient is established, not the organiser. (Art. 21, para. 12 of the VAT Act).
For supplies to non-taxable persons (individuals, end consumers), an equivalent rule applies: the place of supply is where the recipient is established, has a permanent address, or usually resides. (Art. 21, para. 13 of the VAT Act).

What This Means in Practice

If a foreign company organises an online event and sells access to a Bulgarian business, the supply has its place of supply in Bulgaria. Bulgarian VAT rules apply — including the obligation for the organiser to register for VAT in Bulgaria if not already registered here.

If, as a Bulgarian company, you purchase access to a virtual event from a foreign supplier not registered for VAT in Bulgaria, the obligation to account for VAT may transfer to you as the recipient. We recommend consulting your accounting team for the specific treatment of these supplies.

What You Should Do

These obligations apply from the moment the VAT changes Bulgaria 2026 entered into force on 1 January 2026.

Review your contracts with providers of online training, conferences, and webinars.
Verify whether your supplier is registered for VAT in Bulgaria.
If you organise virtual events with an international audience, consult your accounting team for the correct VAT treatment.

To avoid errors in applying the 2026 VAT Act changes and the new VAT rules in Bulgaria, it is advisable to use professional accounting services and expert assistance with VAT registration — especially for online services and work with international clients.

Goods Supplied with Installation by EU Suppliers — Reverse Charge Abolished

What Changed

Until the end of 2025, when a supplier established in another EU Member State supplied goods with assembly or installation on Bulgarian territory, the tax was due from the recipient — the so-called reverse charge mechanism under Art. 82, para. 2, point 2 of the VAT Act. This provision has been repealed.

From 2026, the tax is due from the supplier. A foreign EU supplier that assembles or installs goods on Bulgarian territory is required to be registered for VAT in Bulgaria prior to the first such supply.

For non-EU suppliers, the registration obligation already existed before — no change applies there.

What This Means in Practice

If you are an EU supplier and deliver goods with installation in Bulgaria, you must assess whether you have an obligation to register for VAT in Bulgaria. Registration must precede the first supply.

If you are the recipient of such supplies, the reverse charge obligation under a self-billing protocol (Art. 117 of the VAT Act) no longer applies to these specific supplies. The tax liability now rests with your supplier.

What You Should Do

EU suppliers with installation deliveries in Bulgaria — check whether you are registered for VAT in Bulgaria.
Recipients — review current contracts and clarify with your suppliers how they are treating the VAT obligation.

In the context of the 2026 VAT Act amendments and the new rules for goods supplied with installation in Bulgaria, it is important to ensure timely VAT registration and to work with accountants who are familiar with the subject matter, in order to avoid the risk of incorrect tax accounting and penalties.

New SME Scheme for EU Businesses — VAT Exemption Below EUR 100,000 Turnover

What Has Been Introduced

From 2026, a small business scheme for EU companies is in force, transposing Directive (EU) 2020/285. The scheme allows a taxable person established in one Member State to be exempt from the obligation to charge VAT on supplies in another Member State — without registering locally there.

Conditions for Application

Annual turnover within the EU must not exceed EUR 100,000.
Turnover in the specific Member State must not exceed the national threshold for that country.
For Bulgaria, the national threshold is EUR 51,130 per year.
The person must be established in Bulgaria (registered office or place of management).

How It Works in Practice

A Bulgarian company with turnover below EUR 100,000 within the EU may apply for registration under the scheme at the competent territorial directorate of the НАП. Upon approval, it receives an identification number in the format BG[number]–EX and may make supplies in selected Member States without charging VAT there and without registering locally.

Important: Persons applying the scheme are not entitled to input VAT deduction for goods and services used for the exempt supplies. This is a key factor when assessing whether the scheme is beneficial for a specific business model.

What You Should Do

If you have supplies in other Member States with total EU turnover below EUR 100,000, the scheme may reduce your administrative burden.
Check the national rules for the SME scheme in the countries where you intend to operate.
Assess whether forgoing input VAT deduction is acceptable for your business model.
Consult your accounting team before submitting an application.

VAT Changes Bulgaria 2026: Impact on Your Business

The 2026 VAT Act amendments have a direct effect on accounting records and VAT returns. Each of them may have created new obligations, a need for registration, or a change in how you document specific supplies.

If you operate in Bulgaria as a foreign company, receive services from foreign suppliers, or make supplies within the EU — the VAT changes Bulgaria 2026 introduced through State Gazette Issue 115 require immediate review of your contracts and accounting practices.

PAYROLL BG supports international companies with comprehensive счетоводни услуги, и VAT registration in Bulgaria.

If you have questions about the specific VAT treatment of your supplies, contact us.

VAT Changes in Bulgaria 2026: What Businesses Need to Know