The idea of starting your own business is exciting until you hit the question: „Where do I start with all these institutions?“. Bureaucracy in Bulgaria can seem daunting, but it actually follows strict and clear logic.
Here are the exact steps you need to take in 2026 to work completely legally, pay the right taxes, and sleep soundly.
Step 1: Choose a legal structure (Ltd. or Freelance)
This is the most important decision at the start because it determines what documents you will fill out and how much tax you will pay.
- Freelance: Suitable for people who offer services through their personal labor (designers, consultants, nail technicians, programmers). Registration is easy, and the state recognizes a percentage of expenses for which you do not need to keep invoices.
- Ltd. (Sole Proprietor Limited Liability Company): It is mandatory if you are going to buy and resell goods, have an online store, or hire employees. With it, you pay a 10% tax on the actual profit (revenue minus expenses). To make an informed choice, read our detailed comparison in The advantages and disadvantages of a Ltd. company (EOOD) and freelance work.
Step 2: Registration (Registry Agency)
Once you have chosen the form, you must officially create it with the state.
- For an EOOD (Ltd.): You submit documents to the Commercial Register. You need a capital of at least 2 BGN, to reserve a company name, and to open a fundraising account at a bank of your choice. It is done most easily and flawlessly with the help of a lawyer or an accountant.
- For Freelance work:The procedure is much easier. You register in the BULSTAT register within 7 days of starting your activity. You will find more details about this process in The most important things about registering and accounting as a freelancer.
Step 3: Declaration to the NRA and start of social security contributions
The institutions already know that your company (or profession) exists, but you must tell them exactly when you start working and earning money.
- Within 7 days of the actual start of activity (e.g., launching the website, first sale, or first contract), a special declaration for the registration of a self-insured person must be submitted to the NRA.
- From this moment on, you start owing monthly social security contributions (pension and health insurance) on the minimum insurable income for the country, even if you have no clients in a given month.
Step 4: Bank account and cash register
How will your clients pay you? This question determines whether you need a fiscal device (cash register).
- Without a cash register: You can work without one if all your clients pay exclusively via bank transfer (transfer from their IBAN to your IBAN) or via Postal Money Order (PMO) with a licensed courier company such as Econt or Speedy.
- With a cash register: It is mandatory if you are going to accept cash payments or payments via a standard POS terminal with a physical card. See more specifics in Freelance profession and cash register: When is it mandatory and when not in 2026?.
Step 5: The VAT registration trap
Many starting entrepreneurs think that VAT registration is only done when they reach a large turnover of tens of thousands of levs. However, there is a serious catch for small online businesses!
- If you are going to buy advertising on Facebook, Instagram, Google or use services from platforms like Upwork and Fiverr, you are actually receiving a service from a company outside of Bulgaria.
- In this case, the law obliges you to make a special „partial“ VAT registration (Art. 97a)at least 7 days beforeyou launch your first ad. Learn how the system works in What is VAT and when do we need to register under the VAT Act?.
Summary
Starting a business is not scary when you follow the steps consistently. The best investment you can make on „Day 1“ is to consult with a good accountant. They will help you choose the cheapest and most appropriate form for your specific idea and will protect you from the hidden traps of the law.
