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Payroll and Benefits Guide Bulgaria

Last updated: May 03, 2023

Currency
Bulgarian Lev (BGN)
Employer Taxes
18.92% - 19.62%
Payroll Frequency
Monthly
Employee Costs
13.78%
Capital
Sofia
Date Format
dd/mm/yyyy
Fiscal Year
1 January - 31 December
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Contribution

Employer
Employer Payroll Contributions
13.72%
Social Security applied on salary up to 3,750 BGN monthly.
4.80%
Health Insurance
0.40% – 1.10%
Accident at Work & Occupational Illness Fund
18.92% – 19.62%
Total Employment Cost
Employee
Employee Payroll Contributions
10.58%
Social Security applied on salary up to 3,750 BGN monthly.
3.20%
Health Insurance
13.78%
Total Employee Cost
Employee Income Tax
10.00%
Flat Rate

Employer taxes

Highest
Lowest

Employee taxes

Highest
Lowest

Minimum Wage

General

The minimum wage is 933 BGN per month.

MINIMUM WAGE (PER MONTH)

Highest
Lowest

Payroll

Payroll Cycle

The payroll cycle in Bulgaria is generally monthly with payment being made on the last working day.

13th Salary

There are no provisions in the law regarding 13th salaries.

Working Hours

General

The standard working hours in Bulgaria are 8 hours per day, 40 hours per week.

Overtime

Work in excess of the standard workweek of 40 hours is to be paid as overtime and is regulated by employment contracts or collective agreements. In general, overtime maximum limits are set at three hours per day (across two consecutive days), six hours a week, 30 hours a month, and 150 hours per year.

Overtime hours are paid at 150% of the standard salary rate for working day hours, 175% for weekend hours overtime, and 200% for working on public holidays. Overtime pay cannot be included in the gross annual salary regardless of the employee’s level or seniority.

Leave

Annual Leave (vacation)

Paid leave in Bulgaria is set in the employment contract as a minimum of 20 working days paid leave a year, following the completion of four months of service.

Public Holidays

Public holidays that fall on the weekend are moved to the first or the first two business days following that holiday as time off in lieu.

Date Day Holiday Note
1 Jan 2024 Monday New Year’s Day
3 Mar 2024 Sunday Liberation Day
4 Mar 2024 Monday Liberation Day Holiday Day Off in Lieu
1 May 2024 Wednesday Labor Day
3 May 2024 Friday Good Friday
6 May 2024 Monday Easter Monday, St. George’s Day
24 May 2024 Friday Culture and Literacy Day
6 Sep 2024 Friday Unification Day
22 Sep 2024 Sunday Independence Day
23 Sep 2024 Monday Independence Day Holiday Day Off in Lieu
24 Dec 2024 Tuesday Christmas Eve
25 Dec 2024 Wednesday Christmas Day
26 Dec 2024 Thursday Second Day of Christmas

 

Sick Days

The first two days of sickness are paid for by the employer at a rate of 70% of the regular salary. From the third day of sickness, The National Social Security Fund takes over the payment at 80% of the regular salary rate or 90% for work-related sick leave or injury (providing the employee has completed at least six months of service or Social Security payments). All employees are entitled to claim up to 18 months of paid sick leave.

Employees must provide a medical certificate within 48 hours of the first day of sickness.

Maternity Leave

All female employees are eligible for paid maternity leave of 410 days. Typically, 45 days must be taken before the due date with the remaining days used after the birth. After the sixth month of leave, the mother can choose to transfer the remaining leave days over to the father to use instead.

Workers with at least 12 months of insurance contributions will be paid for maternity leave (temporary incapacity for work) by the National Social Insurance Institution at the rate of 90% of the average daily gross wage.

To cover the period of maternity leave and Parental leave, sick leave certificates must be provided. The first certificate is to be issued 45 days before the due date by the doctor who monitors pregnant women. A second certificate is to be issued 42 days after the birth in the hospital by the doctor who delivered the baby. A third sick note is issued for the leave period up to the 135th day by the child’s or mother’s GP. For the remaining leave entitlement period (up to a total of 410 days), the worker must request this leave from the employer. After each sickness certificate/request for leave has been submitted, the employer must submit it to the National Social Insurance Institute.

Following the end of the 410 days maternity leave, additional paid leave can be taken by the mother, or can be transferred to the father, until the child reaches the age of 2 years old. This leave can be utilized for the parents first, second and third child only. This is paid at a rate of 780 BGN per month providing the child is not in childcare such as nursery and the mother has not consented to the transfer her maternity entitlement to another eligible family member. If the child goes to a nursery during any of the Parental Leave period, the cash benefit will not be paid.

Paternity Leave

Fathers are entitled to Paternity Leave of 15 calendar days, fixed to be taken from the day the baby is discharged from the maternity hospital (of this day is a non-working day, vacation or public holiday, paternity leave still applies and no additional day off in lieu is given).

Paternity Leave is paid at a rate of 90% of the average daily gross remuneration or the average daily insurance income, on which insurance contributions have been paid or due for the period of 24 calendar months preceding the month of the start of the leave upon the birth of a child.

Fathers are eligible for this Paternity Leave once they have completed at least 1 year of employment. To claim this leave the father must submit a declaration form to the employer with a copy of the hospital discharge certificate.

Once the child reaches at least six months of age, the mother can choose to transfer any of her unused maternity leave entitlement to be used by the father.

A further 2 months of leave, paid by the National Social Security Institute, to raise a child under the age of 8 is available to the father providing he has not already taken leave to raise a child younger than two and has not used maternity leave transferred from the mother. To use this leave, the employer must be notified at least 10 days in advance.

Parental Leave

Once the child has reached the age of 2 years old, unpaid Parental Leave of up to 6 months is available to be used by each parent until the child reaches the age of 8 years old, providing the child is not in a state-maintained institution. Each parent may take up to 5 months of the other parent’s leave with his/her consent. Leave can be taken all at once or in installments of not less than 5 working days per leave period. Parents must notify their employer at least 10 working days in advance of taking this leave.

Other Leave

Marriage Leave – Employees are entitled to two days of paid leave in the event of their marriage.
Bereavement Leave – Employees are also entitled to two days of leave to attend the funeral of a family member.

Vacation Days
Public Holidays
Highest
Lowest

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Termination

Termination Process

The termination process is standard in Bulgaria based on termination reasons contained within the Bulgarian Labor Law, unless an employer can provide sufficient cause for dismissal without notice (i.e. due to misconduct). Specific justified causes for termination with prior notice by the employer include the closure of the employer’s enterprise, staff reduction due to change in the employment grid, a decrease in the volume of work, the employee’s lack of ability to effectively perform the required work, and changes in a job position’s requirements which the existing worker’s skills are not aligned with.

The process is initiated by a formal written notice to the employee (except where a disciplinary dismissal applies). Regardless of the cause for termination, the employer must notify the territorial direction of the National Revenue Agency within seven days of the effective termination date.

Notice Period

The statutory minimum notice period in Bulgaria is 30 days’ notice, however, it is common practice to use a notice period of 90 days.

Severance Pay

Severance is 1 to 7 month’s pay depending on termination grounds e.g. office closure, redundancy or staff reductions.

Probation Period

The probation period for permanent employees is generally three months and can be up to a maximum of six months.

VISA

VISA

Any foreigner coming to work in Bulgaria will need to apply for a Bulgaria residence permit. The main legislation governing the issuance of residence permits for foreign citizens is the Foreign Nationals in the Republic of Bulgaria Act.
The legislation establishes that foreigners may apply for one of the three types of Bulgarian residence permits; Bulgarian residence visas, residence visas for foreign employees, and long-term or extended residence visas.

VAT

General

The standard rate in Bulgaria is 20%.

Stay up to date on payroll & employment law changes

Version History

January 17, 2023
The minimum wage is now 780 BGN per month.
April 18, 2022
The Minimum Wage increases from BGN 650 to BGN 710.
March 15, 2022
The Minimum Wage increases from BGN 650 to BGN 710.
The Maximum Social Insurance Income calculation base increases from BGN 3,000 to BGN 3,400. All workers who receive a gross monthly salary over BGN 3,400 will be obliged to pay social security contributions based on this new insurance base. Employer contributions will also be calculated on this increased salary base, meaning the monthly Employer Social Insurance contribution rate will increase from is BGN 567.60 to BGN 643.28.
January 1, 2021
Acquiring the right to use paid annual leave is reduced from 8 to 4 months for employees.
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Questions & Answers

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Sacha
Sacha
1 year ago

Can an employer extend an employees working hours?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Sacha

Yes, but hours can only be extended if specific guidelines are followed:

-Reduction of working hours on other working days.
-A written order is required no later than 3 working days before.
-An extension of working hours can be carried out only for employees who work on a daily basis.
-The extended working day may not last longer than 10 hours for employees with a normal working day duration of up to 8 hours. The extension of working hours is allowed for not more than 20 working days in a row and for not more than 60 working days within one calendar year.
-The extension of working hours is not allowed for employees who have not reached the age of 18 and for pregnant employees.

Dana
Dana
1 year ago

Hello,
Can you tell me if Additional health insurance and food vouchers are considered additional pay or bonuses in Bulgaria?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Dana

In Bulgaria, additional health insurance and food vouchers can be considered additional pay or bonuses, depending on the specific circumstances and the agreement between the employer and the employee.

Additional health insurance and food vouchers may be provided as a benefit by the employer as part of the overall compensation package, or they may be offered as an additional payment on top of the employee’s regular salary.

Rita
Rita
11 months ago

Hello,

How is a yearly bonus taxed in Bulgaria?

Enny Shmurin
Admin
Enny Shmurin
10 months ago
Reply to  Rita

Hello, the mandatory salary increase of 0.6% applied each year of service then this will be taxed the same as salary.

Jason Howling
Jason Howling
8 months ago

Hi, If I have an employee in Bulgaria with 10 years of experience, do I need to increase their salary by 6% each year – increasing by another .6% each year?

Enny Shmurin
Admin
Enny Shmurin
8 months ago
Reply to  Jason Howling

Hello,

Rules might vary depending on industry and job type but in in general, regular workers on permanent contracts are entitled to a ‘Length of Service’ salary increase – after one year of working for each subsequent year of employment.

Robert
Robert
8 months ago

So what percentage of taxes (total so no answers like 10% flat as there are more contributions) in total an employee pays monthly for a 2000 euros a month net salary?
And what is the percentage of taxes (costs) for the employer that pays that salary?

Enny Shmurin
Admin
Enny Shmurin
8 months ago
Reply to  Robert

Hello, I suggest you review our Countrypedia to obtain a general understanding of employer costs. Unfortunately, we cannot provide specific advice on the employer costs associated with a particular worker.

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Payroll and Benefits Guide in Bulgaria

Guide

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Payroll and Benefits Guide
in Bulgaria

What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

And more...

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All questions are answered by our in-house compliance department working in conjunction with our local in-country partner for this specific country

Public Holidays Calendar

Bulgaria
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Date Day Holiday Note
1 Jan 2024 Monday New Year’s Day
3 Mar 2024 Sunday Liberation Day
4 Mar 2024 Monday Liberation Day Holiday Day Off in Lieu
1 May 2024 Wednesday Labor Day
3 May 2024 Friday Good Friday
6 May 2024 Monday Easter Monday, St. George’s Day
24 May 2024 Friday Culture and Literacy Day
6 Sep 2024 Friday Unification Day
22 Sep 2024 Sunday Independence Day
23 Sep 2024 Monday Independence Day Holiday Day Off in Lieu
24 Dec 2024 Tuesday Christmas Eve
25 Dec 2024 Wednesday Christmas Day
26 Dec 2024 Thursday Second Day of Christmas