Complying with legal requirements and correctly reporting income are key factors for success in the freelancing world. One of these requirements is related to freelancing and the use of cash registers.
In this article, we will examine which individuals qualify as freelancers, when the need for a cash register arises, what the legal requirements are, and how to choose the appropriate cash register.
What individuals are freelancers?
Freelancers are individuals who conduct their activities independently, without employment contracts, usually in creative or professional fields. They offer their services directly to clients and are responsible for their own taxes and social security contributions.
Professions that fall into this category:
- Artists and designers
- Journalists and writers
- Consultants and analysts
- IT specialists and programmers
- Photographers and videographers
- Translators and editors
A full list of the most common freelance professions can be found here.
When do freelancers need a cash register?
Freelancers are required to use a cash register when they engage in sales or services that require issuing a fiscal receipt. This is part of the legal requirements for financial reporting and transparency of income.
Professions and activities requiring a cash register:
- Retail and merchants: Individuals selling goods or services to private customers.
- On-site services: Craftsmen, technicians, and repair specialists who provide services at the client’s location.
- Beauty salons: Professions offering services at salons or directly at the client’s location, such as makeup artists, beauticians, microblading artists, barbers, and others.
Professions exempt from this requirement:
- Consultants and analysts who work entirely online.
- Translators and editors whose work does not require physical interaction with clients.
- Artists and writers who sell their work through galleries or publishers.
Legal requirements for the use of cash registers
Legal Regulations
According to Bulgarian law, individuals engaged in commercial activities and receiving cash payments are required to use a cash register. Ordinance No. H-18 of the Ministry of Finance regulates this requirement.
Difference between a cash register, handwritten receipts, and invoices
- Cash Register: Used for issuing automated fiscal receipts when selling goods and services.
- Handwritten Receipts: Used in rare cases when a cash register cannot be used.
- Invoices: Issued for sales to legal entities and can be prepared manually or via software.
Enrolling a cash register with the tax authorities
- Purchasing a cash register: From licensed suppliers.
- Fiscalization: Activation and registration of the device with the National Revenue Agency (NRA).
- Maintenance and servicing: Regular inspections and servicing of the cash register by authorized service providers.
Potential penalties and fines
Failure to comply with cash register requirements can result in fines ranging from several hundred to several thousand BGN, depending on the severity of the violation.
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How to choose the right cash register?
Types of cash registers
Mobile Cash Registers
Mobile cash registers are ideal for small merchants and freelancers who frequently provide services at different locations. These devices are compact, portable, and often battery-powered, making them independent of the electrical grid.
Best suited for:
- Events and markets: Vendors at exhibitions, markets, and outdoor events.
- On-site services: Craftsmen, technicians, hairdressers, and other professionals offering services directly to clients.
- Courses and training sessions: Lecturers and trainers conduct courses at various locations and need to issue receipts.
Mobile cash registers often include features such as Bluetooth and Wi-Fi connectivity, allowing easy integration with other devices and systems.
Desktop Cash Registers
Desktop cash registers are designed for stationary commercial locations and offices with a constant flow of clients and a need for a stable, reliable sales reporting system. These devices usually have more functions and larger fiscal memory, making them suitable for:
- Shops and supermarkets: Businesses with high turnover and a large number of transactions.
- Offices and administrative buildings: Companies that provide services on-site and need to issue receipts.
- Restaurants and cafés: Food establishments where fast and efficient customer service is required.
Desktop cash registers can be connected to various peripheral devices such as receipt printers, barcode scanners, and POS terminals, making them suitable for integration into larger systems.
Cash Register Features
Fiscal Memory
Fiscal memory is mandatory for all cash registers and records all transactions and issued receipts. This function ensures transparency and compliance with tax authorities. Fiscal memory stores information on sold goods and services, with data that cannot be modified or deleted.
Connection to the NRA
All cash registers must be capable of automatically transmitting data to the National Revenue Agency (NRA). This is achieved through an internet connection, allowing tax authorities to monitor transactions in real-time. This function ensures that all sales are properly recorded and that no income is hidden.
Advanced Features
Modern cash registers offer a variety of advanced features that can be useful for different businesses:
- Integration with printers: Enables printing of receipts and invoices on external printers.
- Barcode scanners: Allows fast and accurate scanning of products, speeding up the sales process.
- POS terminals: Integration with POS systems for accepting credit and debit card payments.
- Inventory management: Some cash registers offer inventory tracking features, helping businesses monitor stock levels and automate new orders.
Comparison of the most popular cash registers in Bulgaria
Choosing the right cash register depends on the specifics of the business and the freelancer’s needs. It is essential to consider all the features and capabilities of the device to ensure efficient and compliant operations.
Common mistakes when using a cash register
Freelancers using cash registers should be cautious and avoid common mistakes that could lead to tax issues and penalties. Here are some of the most frequent mistakes to avoid:
- Incorrect fiscalization of the cash register
- Fiscalization is the process of activating the cash register and connecting it to the NRA. Improper execution can lead to serious problems.
- Pro Tip: Ensure fiscalization is carried out correctly by an authorized service provider and that the device is registered with the NRA.
- Incomplete or Incorrect Issuance of Receipts
- All sales and services must be recorded, and receipts must be issued correctly.
- Pro Tip: Always issue receipts for every transaction and verify that all necessary details are included.
- Lack of Maintenance and Regular Inspections
- Cash registers require regular maintenance and inspections to function correctly.
- Pro Tip: Follow the maintenance schedule and ensure periodic inspections are conducted by authorized service providers.
- Failure to Report Malfunctions and Errors
- Any technical issues with the cash register must be reported and resolved immediately.
- Pro Tip: Contact an authorized service provider in case of a malfunction and notify the NRA if necessary.
- Incorrect Reporting of income and expenses
- All income and expenses must be accurately reported and documented.
- Pro Tip: Maintain a detailed record of income and expenses and consider using accounting software or professional accounting services.
- Ignoring Updates and Changes in Legislation
- Tax regulations concerning cash registers may change, and failure to comply can result in violations.
- Pro Tip: Stay updated on legal changes and ensure your cash register and procedures comply with current requirements.
- Improper Storage of Documents
- Proper storage is required for all documents related to the cash register, including invoices, receipts, and service logs.
- Pro Tip: Keep all documents in a secure location and organize them for easy access when needed.
Additional resources and information
- National Revenue Agency (NRA): The official NRA website provides up-to-date information on cash register regulations.
- Cash Register Suppliers: Manufacturer websites offer useful guides and resources on cash register usage.
- Consulting with an Accountant: Schetalnik can provide professional financial reporting advice and services.
Free 30-minute consultation for new clients.
When it comes to freelancing and cash registers, one thing is certain—while using a cash register may seem complex, with the right information and resources, freelancers can ensure full legal compliance and successfully manage their business.
