Individuals, including sole traders, who are performing certain activities specified in the Local Taxes and Fees Act are subject to the annual patent tax for the income from these activities, providing that the turnover of the individual for the previous year did not exceed BGN 50000, and that the individual was not registered under the VAT Act, except for the registration for Intra-Community Acquisition. For the income from patent activities performed, individuals are not levied under the procedure of the new Personal Income Tax Act.
In 2008 the patent tax became a local tax, but no significant differences in the provisions have been introduced.
Returns for patent tax and the declarations for change in the circumstances, which are related to the tax assessment, must be filed at the municipality on whose territory the commercial premises are located.
When the patent activity is not performed in commercial premises or from a permanent establishment, these returns are filed in the municipality corresponding to the permanent address of the individual, including sole traders. In the event a return is submitted by a proxy of a foreign individual, the tax return is filed in the municipality corresponding to the permanent address of the proxy and in all other cases in the municipality of Sofia.
The term for filing the patent tax return has remained 31 January. The changes in the circumstances, related to tax assessment, must be declared within 7 days after the occurrence of the respective circumstance.
There is also no change in the terms for payment. The tax is paid in four equal instalments by 31 January, by 30 April, by 31 July and by 31 October, for the respective quarters of the year.
A 5% discount is granted to the individuals who by 31 January file the patent tax return and within the same term pay the full amount of the tax, which is assessed according to the circumstances declared.