Buying or selling property from abroad

A property sale in Bulgaria is concluded as a notarial deed before a notary in the area where the property is. You do not have to attend: you can authorise someone in Bulgaria. The power of attorney must have the signature and the content notarised at the same time (Art. 37 of the Obligations and Contracts Act). From abroad it is certified at a Bulgarian consulate or by a local notary with an apostille and translation.

local tax

0.1–3%

rate set by the municipality

registration

0.1%

at least €5.11

payment

over €5,112.92

by bank only

tax-free

3 or 5 yrs

on sale, if conditions are met

Power of attorney from abroad

Bulgarian consular officers can certify the date, content and signature of private documents written in Bulgarian (Art. 84 of the Notaries Act). A power of attorney certified by a foreign notary usually needs an apostille or legalisation and a Bulgarian translation — see the guide on powers of attorney from abroad.

• Describe the property precisely — address, cadastral identifier, area.
• State what the representative may do: sell or buy, at what minimum or maximum price, receive or pay the money, sign the declarations.
• If the representative will also sign for the other party, this must be expressly allowed (Art. 38 of the Obligations and Contracts Act).
• You can revoke the power of attorney at any time.

Before the deal: checking the property

The Registry Agency’s Property Register shows the owner, recorded transactions and any mortgages, attachments or other encumbrances. Online searches are made through the Agency portal after registration, for a fee set in the price list. A certificate of encumbrances is issued by the registry office; certificates issued after 19 March 2018 carry a 12-character code for checking their authenticity.

Before drawing up the deed, the notary checks the Property Register (Art. 25(3) of the Notaries Act). The seller provides the title document, a cadastral sketch and a tax assessment certificate from the municipality.

Transaction costs

The local transfer tax is owed by the buyer unless the parties agree otherwise; if the buyer is abroad, the law makes the seller liable (Art. 45 of the Local Taxes and Fees Act). Agree in the contract who pays. The notary fee is calculated on a scale according to the value of the deal; under the 2009 amendment to the Tariff the maximum is BGN 6,000 (€3,067.75). VAT may be added. The notary must give you an invoice listing the provisions under which each fee is due (Art. 89 of the Notaries Act) — ask for an estimate in advance.

Paying from abroad

In the notarial deed the parties declare that the stated price is the price actually agreed. Payments above BGN 10,000 (€5,112.92) are made only through the notary’s special bank account or a bank account at a bank chosen by the parties (Art. 25(9) and (10) of the Notaries Act). With the special account, the notary transfers the money to the seller on terms agreed in writing between the notary and the parties (Art. 25a).

Tax on the sale

If you are resident in Bulgaria or in an EU/EEA country

The income from the sale is not taxed if you sell (Art. 13(1) and Art. 37(7) of the Personal Income Tax Act):

• one home a year, owned for more than 3 years;
• up to two other properties, plus any number of agricultural and forest properties, owned for more than 5 years;
• a property acquired by inheritance or legacy, or restituted — however long you have owned it.

Otherwise the taxable income is the difference between the sale price and the acquisition price, less 10% deemed expenses, taxed at 10% (Art. 33). Residents declare it in the annual tax return. EU/EEA residents prove their right to the exemption with a certificate from their tax authority and a declaration.

If you live outside the EU/EEA

A 10% final tax is due on the difference between the sale price and the documented acquisition price, less 10% deemed expenses (Art. 37(3)). You pay it yourself by the end of the month after the quarter of the sale and file a return under Art. 55. Under most treaties the country where the property is keeps the right to tax income from it.

Buying through a representative: steps

1. Check the property

   Property Register search and certificate of encumbrances.

2. Sign a power of attorney

   At the consulate or a local notary — with the signature and content certified at the same time; apostille and translation if needed.

3. Send the original

   Your representative presents the original power of attorney to the notary in Bulgaria.

4. Pay by bank transfer

   To the seller’s account or the notary’s special account.

5. Notarial deed and registration

   The notary draws up the deed and sends it for registration at the registry office.

After the deal

The buyer does not file a property tax declaration: the notary notifies the municipality within 7 days of the deal (Art. 14(3) and Art. 51(2) of the Local Taxes and Fees Act). Property tax and the waste collection fee are paid to the municipality where the property is.