Bulgaria

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Check Eligibility
- Non-Residents: Foreigners are allowed to buy property in Bulgaria, but restrictions apply to purchasing land. Non-EU nationals are not allowed to own land outright, but they can buy buildings or apartments with the land underneath in the form of a long-term lease.
- Financing: Foreigners can secure financing in Bulgaria, but most banks may require a larger down payment, typically 30% to 40% of the property's value.
Determine the Budget
- Budgeting: It is important to determine a budget, considering the cost of the property, transaction fees, notary fees, and taxes (e.g., property tax and transfer tax).
- Mortgage: For those requiring financing, Bulgarian banks generally offer mortgages with conditions differing based on whether the buyer is a foreigner or a local. The foreign buyer may need a larger deposit, typically around 30-40%.
Find a Property
- Online Search: Websites such as Imoti.net and Bulgarian Properties (bulgarianproperties.com) are useful for searching for properties. Filters are available to narrow down the search by location, price, and other features.
- Real Estate Agents: It is often helpful to work with a local real estate agent who can assist with finding properties and navigating negotiations.
View the Property
- Inspections: It is common to schedule property inspections to evaluate the condition of the property, including its structural integrity and overall condition.
- Visiting the Property: If unable to be in Bulgaria, it may be useful to have someone visit the property on behalf or arrange for a virtual tour.
Make an Offer
- Bidding: In Bulgaria, properties are typically sold based on a negotiation process. The buyer can make an offer and negotiate with the seller.
- Contract: Once the offer is accepted, a preliminary agreement is signed. A deposit is often required, typically between 5% and 10% of the purchase price.
Complete Legal Formalities
- Property Transfer Tax: Bulgaria imposes a property transfer tax, which ranges from 2% to 4% of the purchase price, depending on the location of the property.
- Finalizing the Sale: After signing the preliminary agreement, the buyer and seller will arrange the final sale through a notary public. The property is officially transferred to the new owner after full payment.
Register the Property
- Notary Registration: The notary registers the property transfer in the Bulgarian Land Registry, completing the legal process of transferring ownership.
- Insurance: It is recommended to secure property insurance to protect the property.
Move In
- Once all legal processes are completed, the property is ready for occupancy.
ADDITIONAL CONSIDERATIONS
- Legal Assistance: While the process is generally straightforward, it is advisable to engage a local lawyer to help with legal matters, ensuring everything complies with Bulgarian law.
- Taxes and Fees: Additional costs such as property tax, maintenance fees, and utilities should be considered when budgeting for the purchase.
ADDITIONAL NOTICES
- Property Transfer Tax: A property transfer tax applies, typically ranging between 2% and 4% of the purchase price, depending on the property's location.
- Land Ownership Restrictions: Non-EU nationals are restricted from owning land in Bulgaria but can purchase buildings with a long-term lease for the land underneath.
- Financing: Foreign buyers may need to provide a larger deposit, generally between 30% and 40%, when securing a mortgage from Bulgarian banks.

In Bulgaria, real estate taxes are regulated by the national government and local municipalities. The key types of taxes related to real estate in Bulgaria include:

Property Ownership Tax

Annual Property Tax: In Bulgaria, property owners are required to pay an annual property tax on both residential and commercial properties. This tax is imposed by local municipalities and is based on the property’s tax assessment value.

  • The tax rate generally ranges from 0.01% to 0.45% of the property’s tax assessment value, depending on the municipality.
  • The tax rate is usually higher for commercial properties compared to residential properties.
  • The property tax is typically paid annually and is the responsibility of the property owner.
Real Estate Transfer Tax

The real estate transfer tax is applied when a property changes ownership, such as during a sale or inheritance.

  • The standard real estate transfer tax rate is 3% of the purchase price or the market value of the property, whichever is higher.
  • In some cases, tax reductions may apply for family transfers, such as between spouses or parents and children.
  • The transfer tax is generally paid by the buyer, although this can be agreed upon differently in the sale agreement.
Capital Gains Tax on Real Estate

Capital gains tax is applicable when a property is sold at a profit, though exemptions may apply for primary residences under certain conditions.

  • The general capital gains tax rate is 10% on the profit made from the sale of the property (the difference between the sale price and purchase price).
  • If the property has been owned for more than 3 years, the capital gains tax rate is reduced to 0%.
  • If the property was used as a primary residence for at least 3 years, the sale may be exempt from capital gains tax.
Inheritance and Gift Tax

Bulgaria applies inheritance and gift taxes when real estate is transferred through inheritance or as a gift. The tax rate depends on the relationship between the deceased or donor and the recipient.

  • The inheritance and gift tax rates are progressive, ranging from 0% to 6% depending on the value of the property and the relationship between the parties involved.
  • Direct family members such as spouses, children, and parents are typically taxed at a lower rate or may benefit from exemptions.
  • Other relatives or non-relatives may face higher tax rates based on the property’s value.
Municipal Tax

In addition to the property ownership tax, some municipalities may impose additional local taxes or fees, such as for the use of public infrastructure or local services, like waste management and street cleaning.

Income Tax on Rental Income

If rental income is generated from real estate, it is subject to Bulgarian income tax.

  • Rental income is taxed as part of personal income tax, with rates ranging from 10% to 15%, depending on the total income from all sources.
  • Property owners can generally deduct related expenses, such as maintenance, property management fees, and mortgage interest from their rental income.
  • For short-term rentals (e.g., Airbnb), specific tax rules may apply.
Note: Tax rates and regulations can vary depending on the municipality and specific circumstances. It is advisable to check with local authorities or consult a tax professional for accurate information.
Official
Republic of Bulgaria
CIOC
BUL
Subregion
Southeast Europe
Borders
GRC
MKD
ROU
SRB
TUR
Capital
Sofia
Area
110 879 km²
Population
6 927 000
Timezones
UTC+02:00
Phone
+359   
Currencies
Bulgarian lev (BGN лв)