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Payroll and Social Security Services in Sofia
Hiring in Bulgaria is quick, but it is formal. An employment contract must be registered with the National Revenue Agency before the employee starts work — not after — and monthly declarations are due for every insured person whether or not anything changed. Payroll here is less about calculation and more about registration discipline.
What it costs to employ someone in Bulgaria
Total social security and health insurance contributions sit around a third of gross salary, split between employer and employee, with the employer carrying the larger share. Contributions are calculated between a statutory minimum insurance threshold — which varies by role and industry — and a maximum insurable income ceiling.
Personal income tax is a flat 10% on employment income after the employee's own contributions. Combined, this makes Bulgaria one of the cheaper EU countries for skilled hiring, but the minimum insurance thresholds mean you cannot simply pay a nominal salary to reduce contributions.
Contracts, registration and the things that go wrong
Employment contracts are registered electronically with the tax authority within three days of signing, and the employee cannot lawfully start before that registration exists. Terminations, amendments and changes in working hours all require their own filings.
The most frequent problem we fix for new clients is misclassification: paying a Bulgarian resident as a contractor when the working relationship is legally employment. Bulgarian labour inspections take a substantive view of the relationship, and reclassification carries back-contributions plus penalties.
Managers, owners and self-insured persons
If you are a foreign owner who is also the manager of your Bulgarian company, you likely have a social security obligation here even without a salary — through a management contract or as a self-insured person. Whether Bulgaria or your home country has the right to charge contributions is determined by EU coordination rules and an A1 certificate, and getting this wrong means paying twice.
Frequently asked questions
How much do employer social security contributions cost in Bulgaria?
Combined employer and employee contributions total roughly a third of gross salary, with the employer paying the larger portion. Contributions apply between a minimum insurance threshold that depends on the job classification and industry, and an overall maximum insurable income ceiling.
Can I hire someone in Bulgaria as a contractor instead of an employee?
Only if the relationship is genuinely independent. If the person works set hours, uses your equipment and takes instructions from you, Bulgarian labour authorities will treat it as employment regardless of the contract title — and reclassification means back-contributions plus penalties.
Do I need payroll if my company has no employees?
Frequently yes. A manager of a Bulgarian company usually has an insurance obligation through a management contract or as a self-insured person, which generates monthly declarations even with no staff and no salary.
How quickly can a new hire start?
The contract must be registered with the tax authority within three days of signature, and the employee must not begin work before that registration is filed. In practice we can register a contract the same day we receive the signed documents.
Related services
Accounting & bookkeeping
Monthly bookkeeping, ledgers and statutory reporting — handled in English, on a fixed fee.
Company formation
EOOD and OOD registration for non-residents, plus the bank account and VAT steps that follow.
Corporate tax
Annual returns, advance instalments and planning around the 10% flat corporate rate.
Free consultation
Questions about payroll?
Book a free 30-minute call. We will look at your situation, tell you what is required and what it costs. No obligation, and no pitch if you do not need us.
30 minutes · English and Bulgarian spoken · no obligation