Bulgaria’s parliament enacted fresh transfer pricing regulations on July 31, 2019, aligning with OECD standards. These requirements mandate that Bulgarian companies and foreign entities operating within Bulgaria maintain documentation demonstrating arm’s length pricing for related-party transactions.

Exemptions

Several taxpayer categories are excluded from these obligations:

• Collective investment schemes and national investment funds exempt from corporate income tax
• Alternative tax sectors (gambling, shipping industries)
• Organizations falling below specific thresholds as of December 31 of the prior year:
  • Balance sheet assets under BGN 38 million (~€19.4 million)
  • Net sales revenue below BGN 76 million (~€38.8 million)
  • Fewer than 250 employees on average
• Entities conducting related-party transactions exclusively within Bulgaria

Documentation Requirements

Affected businesses must maintain transfer pricing records for annual transactions surpassing these thresholds (excluding VAT and excise duties):

• Goods sales: BGN 400,000 (~€200,000)
• Loan transactions: BGN 1 million (~€500,000) principal or BGN 50,000 (~€25,000) interest
• Other transactions: BGN 200,000 (~€100,000)

Domestic transactions between related individuals do not require documentation.