Bulgaria Vat Return

Bulgaria VAT Return Skill (Spravka-deklaratsiya po DDS) v2.0

General reference only. This skill is general tax/accounting reference material for AI-assisted workflows. It has not been reviewed for any specific person's facts, documents, elections, deadlines, residency, filing status, or local procedures. Do not rely on it to file, pay, amend, or take a tax position without review by a qualified professional in the relevant jurisdiction.

Section 1 — Quick reference

Read this whole section before classifying anything. The workflow runbook is in vat-workflow-base Section 1 — follow that runbook with this skill providing the country-specific content and eu-vat-directive providing the EU directive content.

Key return structure — Bulgaria uses purchase/sales ledgers submitted with the return:

The return (Spravka-deklaratsiya) summarizes ledger totals. Key rows:

Conservative defaults — Bulgaria-specific values for the universal categories in vat-workflow-base Section 2:

Red flag thresholds — country slot values for the reviewer brief in vat-workflow-base Section 3:

Section 2 — Required inputs and refusal catalogue

Required inputs

Minimum viable — bank statement for the month in CSV, PDF, or pasted text. Must cover the full period. Acceptable from any Bulgarian or international business bank: UniCredit Bulbank, DSK Bank, Fibank (First Investment Bank), Postbank (Eurobank Bulgaria), UBB (United Bulgarian Bank), Raiffeisenbank Bulgaria, Revolut Business, Wise Business, or any other.

Recommended — sales invoices for the period (especially for intra-EU B2B services and zero-rated supplies), purchase invoices for any input DDS claim above BGN 400, the client's DDS number in writing (BG + 9/10 digits).

Ideal — complete purchase/sales ledgers (dnevnik za pokupkite / dnevnik za prodazhbite), prior period return, reconciliation of excess credit brought forward.

Refusal policy if minimum is missing — SOFT WARN. If no bank statement is available at all, hard stop. If bank statement only without invoices, proceed but record in the reviewer brief: "This return was produced from bank statement alone. The reviewer must verify, before approval, that input DDS claims above BGN 400 are supported by compliant tax invoices and that all reverse-charge classifications match the supplier's invoice."

Bulgaria-specific refusal catalogue

These refusals apply on top of the EU-wide refusals in eu-vat-directive Section 13 (R-EU-1 through R-EU-12). If any trigger fires, stop, output the refusal message verbatim, end the conversation.

R-BG-1 — Non-registered entity attempting to file a DDS return. Trigger: client is not registered for DDS and turnover is below the mandatory threshold (EUR 51,130 / BGN 100,000 from 2026). Message: "Non-registered entities do not file DDS returns. If you wish to register voluntarily, contact NRA first."

R-BG-2 — Partial exemption (mixed taxable and exempt supplies). Trigger: client makes both taxable and exempt-without-credit supplies and the exempt proportion is not de minimis. Message: "You make both taxable and exempt supplies. Your input DDS must be apportioned using the partial credit coefficient (koefitsient) under ZDDS Art. 73. This requires an annual calculation. Please use a qualified accountant to determine the coefficient before input DDS is claimed."

R-BG-3 — VAT group structure. Trigger: client is part of a DDS group registration. Message: "DDS group registrations require consolidation across the group. Out of scope."

R-BG-4 — Special schemes (margin, travel agent, investment gold). Trigger: client deals in second-hand goods, travel packages, or investment gold under special schemes. Message: "Special DDS schemes require transaction-level margin or package computation. Out of scope for this skill."

R-BG-5 — SAF-T filing complexity. Trigger: client is a large enterprise required to file SAF-T alongside the DDS return with complex multi-branch reporting. Message: "SAF-T filing for large enterprises with multi-branch structures requires specialist IT and accounting setup. Out of scope."

R-BG-6 — Fiscal representative. Trigger: non-resident supplier with fiscal representative in Bulgaria. Message: "Non-resident registrations with fiscal representatives have specific obligations beyond this skill. Please use a qualified accountant."

Section 3 — Supplier pattern library (the lookup table)

This is the deterministic pre-classifier. When a transaction's counterparty matches a pattern in this table, apply the treatment from the table directly. Do not second-guess. Do not consult Tier 1 rules — the table is authoritative for patterns it covers.

How to read this table. Match by case-insensitive substring on the counterparty name as it appears in the bank statement. If multiple patterns match, use the most specific. If none match, fall through to Tier 1 rules in Section 5.

3.1 Bulgarian banks (fees exempt — exclude)

3.2 Bulgarian government, regulators, and statutory bodies (exclude entirely)

3.3 Bulgarian utilities

3.4 Insurance (exempt — exclude)

3.5 Post and logistics

3.6 Transport

3.7 Food retail (blocked unless hospitality business)

3.8 SaaS — EU suppliers (reverse charge)

These are billed from EU entities and trigger reverse charge under ZDDS Art. 82(2).

3.9 SaaS — non-EU suppliers (reverse charge)

3.10 Payment processors

3.11 Professional services (Bulgaria)

3.12 Payroll and social security (exclude entirely)

3.13 Property and rent

3.14 Internal transfers and exclusions

Section 4 — Worked examples

These are six fully worked classifications drawn from a hypothetical bank statement of a Bulgaria-based self-employed IT consultant. They illustrate the trickiest cases.

Example 1 — Non-EU SaaS reverse charge (Notion)

Input line: 03.04.2026 ; NOTION LABS INC ; DEBIT ; Monthly subscription ; USD 16.00 ; BGN 28.70

Reasoning: Notion Labs Inc is a US entity (Section 3.9). No VAT on the invoice. Service received from non-EU supplier. Under ZDDS Art. 82(2), the Bulgarian recipient self-assesses output DDS at 20% and simultaneously claims input DDS. Both sides must appear: output in Row 14, input in Row 43. Net effect zero for fully taxable client.

Output:

Example 2 — EU service, reverse charge (Google Ads)

Input line: 10.04.2026 ; GOOGLE IRELAND LIMITED ; DEBIT ; Google Ads April 2026 ; -1,660.00 ; BGN

Reasoning: Google Ireland Limited is an IE entity — standard EU reverse charge. Google Ads is a service. Output DDS self-assessed at 20% in Row 14, input DDS in Row 43. Both sides on the return. Net zero for fully taxable client.

Output:

Example 3 — Entertainment/representation, limited deduction

Input line: 15.04.2026 ; РЕСТОРАНТ ЩАСТЛИВЕЦА ; DEBIT ; Business dinner ; -430.00 ; BGN

Reasoning: Restaurant transaction. In Bulgaria, entertainment/representation expenses have deductible input DDS but the expense itself is subject to a 10% expense tax under the Corporate Income Tax Act (ZKPO Art. 204–207). The input DDS on the invoice IS deductible (unlike Malta where entertainment is hard-blocked). However, for a sole trader (ET), representation expenses may be challenged. Default: claim input DDS but flag for reviewer. Note the 10% expense tax obligation separately.

Output:

Example 4 — Capital goods (no statutory threshold)

Input line: 18.04.2026 ; ТЕХНОПОЛИС ; DEBIT ; Laptop Lenovo ThinkPad ; -3,118.00 ; BGN

Reasoning: Bulgaria does not have a specific DDS monetary threshold for capital goods like Malta's EUR 1,160. However, assets used for business with a useful life > 1 year are subject to capital goods adjustment rules: 5-year for movables (ZDDS Art. 79(3)), 20-year for immovables (ZDDS Art. 79(7)). This laptop qualifies as a capital asset. Input DDS is deductible. Flag for capital goods tracking.

Output:

Example 5 — EU B2B service sale (inbound receipt)

Input line: 22.04.2026 ; STUDIO KREBS GMBH ; CREDIT ; Invoice BG-2026-018 IT consultancy March ; +6,850.00 ; BGN

Reasoning: Incoming from a German company. The client provides IT consulting services. B2B place of supply is the customer's country (Germany). The Bulgarian client invoices at 0%. Report in Row 22 (services to EU). Confirm: (a) customer has valid USt-IdNr; (b) invoice shows no Bulgarian DDS.

Output:

Example 6 — Motor vehicle, partial restriction

Input line: 28.04.2026 ; OMV БЪЛГАРИЯ ; DEBIT ; Fuel ; -150.00 ; BGN

Reasoning: Fuel purchase. In Bulgaria, input DDS on passenger vehicles and their fuel/maintenance is deductible only if the vehicle is used exclusively for business, for taxi/rent-a-car, or if the vehicle has 6+1 seats. For a standard passenger car used partly for personal purposes, input DDS is restricted. Default: 0% recovery unless the client can demonstrate 100% business use or the vehicle qualifies under the exceptions (ZDDS Art. 70(1)(4-5)).

Output:

Section 5 — Tier 1 classification rules (compressed)

Each rule states the legal source and the row mapping. Apply silently if the data is unambiguous.

5.1 Standard rate 20% (ZDDS Art. 66(1)(1))

Default rate for any taxable supply unless a reduced rate, zero rate, or exemption applies. Sales: Row 11 (output base/DDS). Purchases: Row 40 (input DDS).

5.2 Reduced rate 9% (ZDDS Art. 66(2))

Applies to: accommodation/hotel services (tourist sector), printed and electronic books and publications, specific baby food and hygiene products. Sales: Row 12 (output base/DDS). Purchases: Row 40 at 9%.

Note: The temporary 9% rate on restaurant/catering and sports facilities expired 31 December 2024. From 1 January 2025 these are at 20%.

5.3 Zero rate and exempt with credit

Exports outside EU (ZDDS Art. 28): Row 20. Intra-EU B2B supplies of goods (ZDDS Art. 7): Row 21 (zero-rated, requires VIES-verified VAT number, transport proof). Intra-EU B2B services (ZDDS Art. 21(2)): Row 22 (place of supply is customer's country). International transport (ZDDS Art. 30-32): Row 20.

5.4 Exempt without credit

Financial services (Art. 46), insurance (Art. 47), healthcare (Art. 39), education (Art. 41), residential rental first letting (Art. 45), gambling (Art. 48), postal universal service (Art. 49). These are excluded from the return — no output DDS, no input deduction on related costs.

5.5 Local standard purchases

Input DDS on a compliant tax invoice (данъчна фактура) from a BG supplier is deductible for purchases used in taxable business activity. Subject to blocked-input rules (5.12). Map to Row 40.

5.6 Reverse charge — EU services received (ZDDS Art. 82(2))

Service from EU supplier invoiced at 0% with reverse-charge note: output DDS self-assessed at 20% in Row 14, input DDS in Row 43. Net zero for fully taxable client. If the EU supplier charged their local VAT, that is NOT reverse charge — treat as overhead with irrecoverable foreign VAT.

5.7 Reverse charge — EU goods received (ZDDS Art. 84)

Physical goods from EU supplier: output DDS self-assessed in Row 13, input DDS in Row 41.

5.8 Reverse charge — non-EU services received (ZDDS Art. 82(2))

Services from outside EU with no VAT charged: same treatment as EU reverse charge. Output in Row 14, input in Row 43.

5.9 Imports (ZDDS Art. 56)

Physical goods imported from non-EU: import DDS assessed by customs on the customs declaration. Input DDS on import in Row 42 if goods are for taxable business use.

5.10 Capital goods adjustments (ZDDS Art. 79)

Movable capital goods: 5-year adjustment period. Immovable property: 20-year adjustment period. No specific monetary threshold — asset classification based on accounting standards (useful life > 1 year). If client disposes of or changes use, adjustment may be required.

5.11 3-period excess credit offset (ZDDS Art. 92)

Bulgaria has a unique rule: if input DDS exceeds output DDS, the excess is NOT immediately refundable. It must be offset against output DDS due in the next 3 consecutive periods. Only if excess remains after 3 periods is it refundable. Exception: accelerated refund for businesses with >30% zero-rated supplies.

5.12 Blocked input DDS (ZDDS Art. 70)

The following have restricted or zero recovery:

• Passenger vehicles (up to 8+1 seats) and their fuel/maintenance — blocked unless used exclusively for taxable business, taxi/rent-a-car, 6+1 seat exception (Art. 70(1)(4-5))
• Goods/services for entertainment/representation — input DDS IS deductible, but subject to 10% expense tax under ZKPO
• Goods for personal use of staff/owners (Art. 70(1)(2))
• Goods/services not used for taxable supplies (Art. 70(1)(1))

5.13 Sales — local domestic (any rate)

Charge 20% or 9% as applicable. Report in sales ledger and Rows 11/12.

5.14 Sales — cross-border B2C

Services to EU consumers above EUR 10,000 threshold: R-EU-5 (OSS refusal) from eu-vat-directive fires. Below threshold: Bulgarian DDS at applicable rate.

5.15 Purchase/sales ledgers (ZDDS Art. 124-126)

Both the purchase ledger (dnevnik za pokupkite) and sales ledger (dnevnik za prodazhbite) MUST be submitted with the return. Each invoice must be individually recorded.

Section 6 — Tier 2 catalogue (compressed)

6.1 Fuel and vehicle costs

Pattern: OMV, Shell, Лукойл, Petrol, EKO, fuel receipts. Why insufficient: vehicle type and business-use unknown. Passenger car fuel blocked unless 100% business or qualifying vehicle. Default: 0% recovery. Question: "Is this a passenger car (restricted) or a commercial vehicle/qualifying vehicle used 100% for business?"

6.2 Restaurants and entertainment

Pattern: any restaurant, café, bar, catering name. Why insufficient: representation expenses deductible for DDS but trigger 10% expense tax. Business vs personal unknown. Default: block input DDS. Question: "Was this a business representation expense? (Note: if yes, input DDS deductible but 10% expense tax applies under ZKPO.)"

6.3 Ambiguous SaaS billing entities

Pattern: Google, Microsoft, Adobe, Meta, Slack, Zoom, etc. Why insufficient: same brand bills from IE, US, or local entity. Default: non-EU reverse charge. Question: "Check the invoice for the legal entity name and billing country."

6.4 Round-number incoming transfers from owner-named counterparties

Pattern: large round credit matching client's name. Default: exclude as owner injection. Question: "Is this a customer payment, your own money, or a loan?"

6.5 Incoming transfers from individual names

Pattern: incoming from private-looking counterparties. Default: domestic B2C sale at 20%. Question: "Was this a sale? Business or consumer? Country?"

6.6 Incoming transfers from foreign counterparties

Pattern: foreign IBAN or foreign currency. Default: domestic 20%. Question: "B2B with VAT number, B2C, goods or services, which country?"

6.7 Large one-off purchases (capital goods tracking)

Pattern: equipment, laptop, machinery. Why insufficient: no statutory DDS threshold but accounting classification determines adjustment period. Default: deductible; flag for capital goods register. Question: "Confirm useful life > 1 year for capital goods tracking."

6.8 Mixed-use phone, internet, home office

Pattern: Vivacom, A1, Yettel personal lines; home electricity. Default: 0% if mixed without declared %. Question: "Dedicated business line or mixed-use? Business percentage?"

6.9 Outgoing transfers to individuals

Pattern: outgoing to private-looking names. Default: exclude as drawings. Question: "Contractor with invoice, wages, refund, or personal transfer?"

6.10 Cash withdrawals

Pattern: ATM, теглене, cash withdrawal. Default: exclude as owner drawing. Question: "What was the cash used for?"

6.11 Rent payments

Pattern: наем, rent, lease. Default: no DDS (residential default). Question: "Commercial or residential? Does landlord charge DDS?"

6.12 Foreign hotel and accommodation

Pattern: hotel charged abroad. Default: exclude from input DDS. Question: "Was this a business trip?"

6.13 Credit brought forward and 3-period offset

Pattern: excess credit from prior periods. Why insufficient: must track the 3-period offset chain. Default: flag for reviewer. Question: "Which period did the excess credit originate? Has it been offset for 3 consecutive periods?"

Section 7 — Excel working paper template (Bulgaria-specific)

The base specification is in vat-workflow-base Section 3. This section provides the Bulgaria-specific overlay.

Sheet "Transactions"

Columns A–L per the base. Column H ("Row code") accepts only valid Bulgaria DDS row codes from Section 1 of this skill. Use blank for excluded transactions.

Sheet "Row Summary"

One row per return row. Column A is the row number, column B is the description, column C is the value computed via formula. Key rows:

Output DDS:
| 11 | Output DDS domestic 20% | =SUMIFS(Transactions!F:F, Transactions!H:H, "11") |
| 12 | Output DDS domestic 9% | =SUMIFS(Transactions!F:F, Transactions!H:H, "12") |
| 13 | Output DDS intra-EU goods | =SUMIFS(Transactions!F:F, Transactions!H:H, "13") |
| 14 | Output DDS reverse charge services | =SUMIFS(Transactions!F:F, Transactions!H:H, "14") |
| 20 | Zero-rated exports | =SUMIFS(Transactions!E:E, Transactions!H:H, "20") |
| 21 | Intra-EU supplies goods | =SUMIFS(Transactions!E:E, Transactions!H:H, "21") |
| 22 | Intra-EU services | =SUMIFS(Transactions!E:E, Transactions!H:H, "22") |
| 01 | Total output DDS | =SUM(Row11..Row15) |

Input DDS:
| 40 | Input DDS domestic | =SUMIFS(Transactions!F:F, Transactions!H:H, "40") |
| 41 | Input DDS EU goods | =SUMIFS(Transactions!F:F, Transactions!H:H, "41") |
| 42 | Input DDS imports | =SUMIFS(Transactions!F:F, Transactions!H:H, "42") |
| 43 | Input DDS reverse charge services | =SUMIFS(Transactions!F:F, Transactions!H:H, "43") |
| 31 | Total input DDS | =SUM(Row40..Row43) |

Settlement:
| 50 | Net DDS (Row 01 - Row 31) | =Row01-Row31 |
| 70 | DDS payable (if 50 > 0) | =MAX(0, Row50) |
| 60 | Excess credit (if 50 < 0) | =ABS(MIN(0, Row50)) |

Sheet "Return Form"

Final return-ready figures. Bottom-line: Row 70 (payable) or Row 60/80 (excess credit / refundable after 3-period offset).

Color and formatting conventions

Per the xlsx skill: blue for hardcoded values, black for formulas, green for cross-sheet references, yellow background for any Default? = "Y" row.

Section 8 — Bulgaria bank statement reading guide

Follow the universal exclusion rules in vat-workflow-base Step 6, plus these Bulgaria-specific patterns.

CSV format conventions. UniCredit Bulbank and DSK exports typically use semicolon delimiters with DD.MM.YYYY dates. Revolut Business exports use ISO dates. Common columns: Date, Description, Debit, Credit, Balance. Fibank may use Cyrillic headers.

Bulgarian/Cyrillic variants. Descriptions may be in Bulgarian Cyrillic: наем (rent), заплата (salary), лихва (interest), превод (transfer), теглене (withdrawal). Treat as English equivalent.

Internal transfers. Own-account transfers between client's banks. Labelled "вътрешен превод", "own transfer". Always exclude.

Sole trader draws. A self-employed person (ET — едноличен търговец) cannot pay themselves wages — transfers to personal account are drawings. Exclude.

Refunds and reversals. Identify by "възстановяване", "refund", "сторно", "reversal". Book as negative in same row as original.

Foreign currency. Convert to BGN at the BNB (Bulgarian National Bank) fixing rate for the transaction date. Note the rate in the Notes column.

IBAN prefix. BG = Bulgaria. IE, LU, NL, FR, DE = EU. US, GB, AU, CH = non-EU.

Section 9 — Onboarding fallback (only when inference fails)

9.1 Entity type and trading name

Inference rule: ET = sole trader; OOD/EOOD = limited company. Fallback: "Are you a sole trader (ET), limited company (OOD/EOOD), or other?"

9.2 DDS registration status

Inference rule: if filing a DDS return, they are registered. Fallback: "Are you DDS-registered (mandatory or voluntary)?"

9.3 DDS number

Inference rule: BG-format numbers may appear in EU customer payment descriptions. Fallback: "What is your DDS number? (BG + 9/10 digits)"

9.4 Filing period

Inference rule: first and last transaction dates. Bulgaria is always monthly. Fallback: "Which month does this cover?"

9.5 Industry and sector

Inference rule: counterparty mix. Fallback: "What does the business do?"

9.6 Employees

Inference rule: DOO/ZO outgoing payments. Fallback: "Do you have employees?"

9.7 Exempt supplies

Inference rule: medical/financial/educational income patterns. Fallback: "Do you make exempt supplies?" If yes and non-de-minimis: R-BG-2 refuses.

9.8 3-period excess credit status

Inference rule: not inferable from single period. Fallback: "Do you have excess DDS credit carried forward? From which period?"

9.9 Cross-border customers

Inference rule: foreign IBANs on incoming. Fallback: "Do you have customers outside Bulgaria? EU or non-EU? B2B or B2C?"

9.10 Vehicle ownership

Inference rule: fuel/vehicle-related debits. Fallback: "Do you own/lease a vehicle for business? Type (passenger car vs commercial)?"

Section 10 — Reference material

Sources

Primary legislation:

1. Zakon za danak varhu dobavenata stoynost (ZDDS — VAT Act) — Articles 2-12, 28-50, 56, 66, 70, 73, 79, 82, 84, 92, 124-126
2. Pravilnik za prilagane na ZDDS (PPZDDS — Implementing Regulations)

NRA guidance: 3. NRA DDS return form and instructions — https://portal.nra.bg 4. NRA guidance on reverse charge 5. NRA SAF-T implementation guidance

EU directive (loaded via companion skill): 6. Council Directive 2006/112/EC — via eu-vat-directive companion skill 7. Council Implementing Regulation 282/2011

Other: 8. VIES validation — https://ec.europa.eu/taxation_customs/vies/ 9. BNB exchange rates — https://www.bnb.bg

Known gaps

1. The supplier pattern library covers common Bulgarian counterparties but not every local SME.
2. The 3-period offset rule for excess credits requires period-by-period tracking beyond this skill's single-period scope.
3. SAF-T filing requirements (phased from 2026) are not fully detailed.
4. The 9% reduced rate scope should be verified annually.
5. BGN-to-EUR transition (target date) may affect currency handling.

Change log

• v2.0 (April 2026): Full rewrite to Malta v2.0 structure. 10-section layout. Supplier pattern library with Bulgarian banks (UniCredit Bulbank, DSK, Fibank). No inline tier tags. Companion skill references added.
• v1.0 (April 2026): Initial skill with inline tier tags.

Self-check (v2.0)

1. Quick reference at top with row table and conservative defaults: yes.
2. Supplier library as literal lookup tables: yes (14 sub-tables).
3. Worked examples (6): yes.
4. Tier 1 rules compressed without inline tags: yes (15 rules).
5. Tier 2 catalogue compressed: yes (13 items).
6. Excel template specification: yes.
7. Onboarding as fallback only: yes (10 items).
8. All Bulgaria-specific refusals present: yes (R-BG-1 through R-BG-6).
9. Reference material at bottom: yes.
10. No inline [T1]/[T2]/[T3] tags in body text: yes.

End of Bulgaria VAT Return Skill v2.0

This skill is incomplete without BOTH companion files loaded alongside it: vat-workflow-base v0.1 or later AND eu-vat-directive v0.1 or later.

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional before filing or acting upon.

The most up-to-date, verified version of this skill is maintained at openaccountants.com.

Source: OpenAccountants — open tax Guides for AI, reviewed by named CPAs/CAs/EAs. Quality: source-cited draft. For always-current figures and named-accountant backing, connect the OpenAccountants MCP server (openaccountants-mcp).