While banks in Bulgaria are relatively sophisticated and offer a wide range of services, the country is infamous for its paperwork-heavy bureaucracy. There is also a lack of access to English translation and services – this primarily affects the banking and tax sectors but may extend to other areas such as healthcare, legal and public administration. These are some of the challenges expats may face when it comes to banking and paying taxes in Bulgaria.
Money in Bulgaria
Bulgaria's official currency is the Bulgarian Lev, abbreviated as BGN. Despite being a part of the EU, Bulgaria is not part of the Eurozone, the group of countries that use the Euro currency, and it uses its own currency. From January 2025, Bulgaria will switch from the lev to the euro if it meets the Eurozone convergence criteria.
The lev is subdivided into 100 stotinki. The value of the lev is pegged to the euro at a rate of around 1.96 to 1. The Bulgarian National Bank regulates Bulgaria's banking system and currency.
- Notes: 1 BGN, 2 BGN, 5 BGN, 10 BGN, 20 BGN, 50 BGN and 100 BGN
- Coins: 1, 2, 5, 10, 20 and 50 stotinki; 1 BGN and 2 BGN
Banking in Bulgaria
Although Bulgaria's small market hasn't attracted many international banks, local banks are run efficiently and with a focus on customer service. Some reliable Bulgarian banks include Raiffeisen, UniCredit Bulbank, DSK and Postbank. Banks are typically open between 9am and 5pm, Monday to Friday. All four of these banks offer mobile and online banking services.
Opening a bank account
Both residents and non-residents of Bulgaria can open a bank account. As most documents aren't in English, completing the paperwork required to open a bank account can be challenging. Expats looking for assistance with banking and tax matters in Bulgaria can consider hiring a local accountant or financial advisor proficient in English, or they can use professional expat-focused services like those offered by specialised relocation agencies.
Expats opening a bank account in Bulgaria will need their passport or national ID card, an address to send correspondence to and a minimum deposit amount. Banks may also require proof of income, a letter of employment and a copy of a lease agreement, and they may perform a background or credit check. Bank cards can be collected or delivered to the specified address, typically within one week of opening an account.
ATMs and credit cards
ATMs are common in Bulgarian cities but may be limited in rural areas and villages. Expats can use any ATM, regardless of which bank they belong to, but withdrawal fees will be higher from other banks' ATMs.
Visa and MasterCard are widely accepted in Bulgarian cities, but this is not the case in smaller villages where cash payments are the norm. Expats can exchange currency at banks, and bureaux de change are widely available in cities.
Digital wallets and mobile payment services like Google Pay and Apple Pay – and local solutions like Paysera – are available in Bulgaria and are becoming more widely accepted. These allow users to make contactless payments, transfer money or pay bills through their smartphones.
Taxes in Bulgaria
The Bulgarian tax year follows the calendar year. Expats will be considered Bulgarian tax residents if they have been in the country for more than 183 days in 12 months. Tax residents in Bulgaria will have their worldwide personal income taxed at a flat rate of 10 percent. Those who aren't considered tax residents only have to pay tax on income earned within Bulgaria.
Expats with dual citizenship, offshore accounts or foreign property holdings may need to consider additional factors when banking and filing taxes in Bulgaria. These could include reporting their foreign financial assets, understanding double-taxation agreements or consulting with a tax professional to ensure compliance with both Bulgarian and foreign tax laws.
Bulgarian companies often automatically deduct taxes from their employees' salaries every month, saving their employees the hassle of paying taxes themselves.