Pushing your company across countries and oceans and into Bulgaria is a great choice that comes with big opportunities. You’ll get to form new business relationships while showing your original partners that you’re committed to international operations. However, your expansion also includes numerous steps to complete that can take anywhere from weeks to months.
Globalization Partners can make the Bulgaria subsidiary setup process easier. In fact, you can use our existing subsidiary to start working in a few days. We’ll hire employees and assign them to work for you, then take on the responsibility of compliance for compensation, employment, and more.
How to Set Up a Bulgaria Subsidiary
When you’re researching how to set up a Bulgaria subsidiary, it will help to decide where you want to incorporate and what type of company structure you need since both can impact the subsidiary setup process. Different regions or cities in Bulgaria may have their own subsidiary laws that can impact how you incorporate. If you don’t have time to research the area around a physical office space, you should work with a consultant or lawyer who can help you through the process.
We also recommend deciding which subsidiary structure is best for your company. Your actions will be limited by the entity you choose, and each structure has its own incorporation process. Bulgaria’s business entities include a limited liability company (LLC), joint-stock company, limited partnership, free zone company, sole proprietorship, branch office, and representative office. Most companies choose to incorporate as an LLC since it can benefit both the subsidiary and your parent company.
The steps to set up a Bulgaria subsidiary as an LLC, include:
- Obtaining minimum share capital of 1 EUR
- Drafting a memorandum and articles of association
- Creating a resolution of the parent company detailing the decision to create a subsidiary
- Appointing a subsidiary manager
- Filing all documents with the Central Commercial Register at the Registry Agency of the Ministry of Justice
- Notarizing, apostilling, and legalizing all required documents in Bulgaria
- Opening a bank account with a local bank
Bulgaria Subsidiary Laws
Bulgaria’s subsidiary laws depend on what type of entity you choose and where your physical office space is. LLCs need a single shareholder and a single director who can be of any nationality and do not have to live in Bulgaria. Once you incorporate, you need to file annual financial statements with the Bulgarian Trade Register every year before March 31st.
The country uses a double-entry accounting system stated in the Accountancy Act (ZS) that all LLCs must comply with. You have to register for VAT if your annual turnover exceeds BGN 50,000 and file your VAT returns monthly. Since you need minimum share capital to incorporate, you should establish in-country bank accounts
Benefits of Setting Up a Bulgaria Subsidiary
Setting up a Bulgaria subsidiary is the first step for companies looking to expand the traditional way. Many companies expand as an LLC because it offers limited liability to the parent company. It also helps the subsidiary create its own structure and culture based on Bulgaria’s overarching culture.
Globalization Partners offers Bulgaria subsidiary outsourcing for companies that don’t have the time to set up their own subsidiary. As a global PEO, we can use our existing subsidiary to help you start working faster and make your employees productive from day one. You won’t have to go through the Bulgaria subsidiary setup process, and you can start working in a few days instead of a few weeks.
Other Important Considerations
Since the incorporation process can take weeks or months, we recommend setting aside the time and money you’ll need to complete everything. For example, you may have to clear your schedule to travel back and forth to Bulgaria for a month or two. If you don’t have that time in your schedule, you should work with another company executive or member to handle the process.
It’s also a good idea to work with your accounting department to set aside the money you’ll need to incorporate successfully. You should factor in travel costs, the hiring process, and more to make sure you aren’t surprised by any hidden fees.
Let Globalization Partners Help With Your Expansion
Globalization Partners can help make your expansion a breeze through Bulgaria subsidiary outsourcing. Contact us today to learn more.
THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). G-P does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect G-P’s product delivery in any given jurisdiction. G-P makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.