If you own a property in Bulgaria and plan to rent it out yourself on a short-term basis during the summer tourist season, it is essential to comply with local legal and tax regulations. Short-term rentals are considered as providing accommodation services in Bulgaria, which entails certain obligations. Here we will briefly go through what you will need to rent your property in Bulgaria to give you an idea.
Registration in the ESTI system: Before you start renting, you need to register your property in the state tourist register ESTI. This registration is compulsory for all properties providing accommodation services. Once registered, the property will receive a unique identification number, which is also required by platforms such as Booking.com in accordance with the EU DAC 7 Directive. Registration can be done via the official website of the Bulgarian Ministry of Tourism.
Tax obligations: Income from short-term rentals is subject to income tax at the rate of 10%. When providing accommodation services, it is advisable to use the so-called patent tax, which is specific to this type of activity. For more information on tax obligations, please visit the official website of the Bulgarian National Revenue Agency (NRA). https://nra.bg/
Tourist tax: In addition to income tax, the landlord is required to pay tourist tax for each guest staying at the property. The amount of this tax is set by the local government and varies from municipality to municipality. Monthly, by the 15th of the following month, the number of guests must be reported and the corresponding amount of tourist tax must be paid. An annual report must also be submitted by 31 January of the following year. Details of the tourist tax can be found on the official website of the Bulgarian National Revenue Agency (NRA).
Registration of BULSTAT number: As a foreign property owner, you need to obtain a BULSTAT identification number. This number is used to identify the taxpayer in Bulgaria and is necessary for other administrative and tax tasks. You should always have a BULSTAT registration as long as you own property in Bulgaria. You can read what is a Bulstat number on our blog.
Registering with the tax office: With your BULSTAT number, you need to register with the local tax office in the area where the property is located. This registration registers you as a taxpayer with rental income. For more information on registering with the tax office, please visit the official website of the Bulgarian National Revenue Agency (NRA).
Record keeping: It is important to keep accurate records of the number of guests staying, payments received and tourist tax payments. These records serve as a basis for monthly and annual reporting and may be subject to inspection by the tax authorities.
Compliance with local regulations: When providing accommodation services, it is essential to comply with local regulations concerning safety, hygiene and other standards. It is advisable to consult a local lawyer to ensure compliance with all requirements.
Following these steps will ensure that your seasonal short-term rental on the Black Sea coast will comply with Bulgarian laws and regulations. We recommend working with local experts to help you navigate local requirements and ensure that all your obligations are properly met.
In most cases, you can also simply leave the entire rental process to the complex, which will pay you your profit at the end of the year and register your property in the ESTI system. The complex keeps accurate records of guests and also pays the tourist tax. However, it is important to check whether the 10% tax on short-term rentals has already been paid on the profit paid out.
