How dividend tax works in Bulgaria
Bulgaria taxes dividends and liquidation proceeds at 5% for resident and non-resident individuals, usually as a final tax. Domestic dividends are commonly withheld by the Bulgarian payer, while foreign dividends are normally reported in the annual return.
For corporate recipients, Bulgarian law generally levies 5% withholding tax on dividends paid to non-resident legal persons, but there are statutory exemptions, including many EU or EEA-resident company recipients.
Source-country withholding tax can still apply before the dividend reaches Bulgaria, so treaty relief and ownership paperwork matter. Bulgaria also taxes hidden profit distributions like dividends.
Tax rates at a glance
- Dividend tax
- 5%Final tax
- Dividend WHT
- 5%
- EU / EEA company recipient
- 0%
- Foreign dividends
- 5%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
InvestorsShareholdersFoundersHolding companiesFamily offices
Watch out for
- Foreign-source withholding tax may be charged before the dividend ever reaches Bulgaria.
- The 5% Bulgarian tax is on the dividend itself, not just on company profits, so distribution timing matters.
- If you live outside Bulgaria, your home country may still tax the dividend even when Bulgaria does not.
Frequently asked questions
Does Bulgaria tax dividends?
Yes. Dividends are generally taxed at 5% in Bulgaria.
Does Bulgaria have dividend withholding tax?
Yes. The standard withholding tax on dividends is 5%, with some EU and EEA exemptions for company recipients.
Are foreign dividends taxed in Bulgaria?
Yes, for Bulgarian tax residents they are generally taxed at 5% as part of the annual personal tax return.