1. Implementation of Council Directive 2018/822 (DAC 6)
The Bulgarian Tax Insurance Procedure Code has been amended for purpose of transposing the Council Directive 2018/822 on the mandatory automatic exchange of information in the field of taxation in relation to reportable cross-border arrangements, referred as DAC 6.
The aim of the related amendments of the Bulgarian Tax Insurance Procedure Code is to enhance the tax transparency, to provide measures against the tax base erosion and profit shifting to jurisdictions applying more favorable tax regime and against potentially aggressive tax planning in cross-border transactions.
The new rules impose reporting obligations to consultants and tax payers to disclose to the National Revenue Agency any cross border reportable tax arrangements. The Code provides exemption from reporting obligations of intermediaries as lawyers, which are subject to legal professional privilege. The definition for “reportable arrangements” is broadly stated in Art. 143z of the Code. Consultants which are subject to the reporting obligation can be defined in 2 main groups:
The first group involves “any person that designs, markets, organizes or makes available for implementation or manages the implementation of a reportable cross-border tax arrangement.”
The second group involves ‘’any person that, in consideration to the relevant facts and circumstances and based on available information and the relevant expertise and understanding required to provide such services, knows or could be reasonably expected to know that they have undertaken the obligation to provide, directly or by means of other persons, aid, assistance or advice with respect to designing, marketing, organizing, making available for implementation or managing the implementation of a cross-border tax arrangement.’’
The disclosure applies to all taxes except VAT, custom and excise duty, social security contributions, administrative taxes and contractual receivables.
The reporting deadlines implemented in the Code are aligned with those under DAC 6.
2. VAT Quick Fixes 2020
As of January 1st. 2020 the following “quick fixes” has been adopted in the Bulgarian VAT Act and the Implementation Code of the VAT Act.
- Call-off stock relief. Provide a simplified procedure and eliminate the need of VAT registration of companies delivering goods on the territory of the country which are intended to consecutive supply to known customers within certain period of time.
- Allocation of transportation to EU cross-border chain supplies. The new VAT rules introduce harmonized criteria for determining which of the transactions in a chain can be considered as intra-community supply.
- Burden of proof for Intra-Community supplies. The amendments relate to specification of concrete documentary evidences which need to be made available for purpose of proof of the IC supply of goods.
- Mandatory VAT number verification and VIES reporting. The amendments impose obligation to the customer to provide a valid VAT number and the VIES report to be filed correctly for purpose of applying the zero rate in IC supplies. In case on non-compliance the supply will be subject to VAT in the state of dispatch.
New minimum salary
As of 01.01.2020 the minimum statutory limit of the monthly salary shall be BGN 610 (EUR 312).
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