Dormant Bulgarian company: what you actually owe and how to stop overpaying

What "no activity" actually means under Bulgarian law

If you set up a Bulgarian company years ago, maybe to buy an apartment on the coast, to test a project that never launched, or simply because a lawyer bundled it into a property purchase, and it has not touched a bank transaction since, you own what Bulgarians call a "sleeping company" (спяща фирма). That is not a legal term. The legal term is a company "without activity" under the Bulgarian Accounting Act.

"Without activity" has a strict meaning: no invoices issued or received, no payments through the company's bank account, no contracts performed, no salaries paid, during the calendar year. A single rental payment, one consulting invoice, even one transaction on the company account, counts as activity. There is no partial sleep.

The company itself does not disappear. It stays on the Commercial Register (Bulgaria's public registry of all companies) under its own EIK, the unique company number, with full legal existence and full liability for its director. What shrinks is the paperwork, not the company's legal life or your responsibility for it.

The most common reason we see from abroad: a company that exists only to hold a property. That is a completely normal, legitimate setup in Bulgaria, and dormancy is the right state for it, as long as the filings are handled correctly.

What a dormant company still owes every year

Even asleep, the company has one recurring obligation, and getting it right matters more than it seems from a distance.

• A no-activity declaration to the Commercial Register (under Art. 38(9)(2) of the Accounting Act), filed instead of publishing a full annual financial statement. Under the rule currently in force, this declaration is a one-time filing, for the first year without activity, not a yearly repeat. That rule has changed before, it used to require annual re-filing, and it could change again, so confirm the current wording with an accountant rather than relying on a blog post, including this one.
• An exemption from the annual corporate tax return. Filing the no-activity declaration also exempts the company from the annual tax return under Art. 92(5) of the Corporate Income Tax Act, unlike an active company, which files by 30 June.
• The statistics office (NSI). Under the latest rule, a company with genuinely zero activity no longer files anything with Bulgaria's National Statistical Institute either. This is a recent simplification, applied inconsistently by different accountants, so double-check it applies to your exact situation.

Bottom line: a correctly dormant company's real yearly workload is one filing, typically due by 30 June for the prior year.

What you do not owe

Knowing what you are exempt from matters as much as knowing what you owe, because this is exactly where some accounting firms in Bulgaria keep billing for work that no longer applies.

• No full annual financial statement to prepare or publish (balance sheet, income statement, notes) - the one-page declaration replaces it entirely.
• No monthly VAT (value-added tax) returns, but only if the company is not VAT-registered. If it is, monthly returns stay mandatory even at zero turnover, dormant does not mean out of VAT's reach. If you registered for VAT years ago, often to reclaim tax on a property purchase, and never use it otherwise, deregistering is usually the cheaper long-term option.
• No payroll or social security filings, if there is no employee and the director draws no salary.
• No state fee for filing the declaration - filing is free either way, for a dormant company and an active one. The real saving is not a fee, it is the accountant's time: one page instead of a full set of financial statements.

The trap: paying a full retainer for a company doing nothing

Here is where most owners of dormant Bulgarian companies quietly overpay: they keep paying the same monthly accounting retainer they paid when the company was active, often set up years ago by a lawyer or formation agency, for a company whose entire yearly workload is one filing.

It is rarely deliberate. Nobody revisits the invoice once you are abroad and the company is out of sight. Add the language barrier, since most correspondence from Bulgarian authorities and accountants arrives in Bulgarian, and it becomes easier to keep paying than to ask what, exactly, you are paying for.

Our rule is simple: a sleeping company should not cost what a working one costs. If you are paying a full accounting fee for a company with zero activity, ask your accountant directly what they do for that fee every month. If the honest answer is "nothing specific, you are just on a plan," that is your sign to recalculate.

Close it, or let it sleep?

The obvious question: if keeping it costs so little, why close it at all? And if it does nothing, why not close it? The answer depends on your plans for the property or the project behind it.

Liquidation is the formal closing procedure: appoint a liquidator, publish a creditor notice in the Commercial Register, and wait a minimum statutory 6-month period before the company can be struck off. Add state fees, notary costs, and an accountant's work on the final accounts and tax deregistration. In practice, liquidation rarely comes out cheaper than one or two years of correctly maintained dormancy, and it takes months, not days, which matters if you are coordinating it from abroad.

Keeping it dormant is the cheaper path when done right: one filing a year, the correct declaration, no padded fees. It makes sense if you still hold the property through the company, might restart activity later, or the maintenance cost is simply lower than the cost and time of liquidating.

Closing makes sense once you are certain you will never use the company again: the property is sold, the plans are permanently off, and even the minimal maintenance cost is no longer worth paying.

Waking it up. If you decide to restart activity, there is no separate "reactivation" procedure, you simply start operating: issue an invoice, hire someone, cross the mandatory VAT threshold. From the year activity resumes, you file the normal annual reports instead of the no-activity declaration, nothing needs to be announced in advance.

When it is worth asking a human

Most dormant companies are simple cases, which is exactly what FreeMe.bg is built for. But a few situations genuinely need a conversation, not an automated answer: a property that is partly rented out (that is activity, not sleep, even if occasional); a VAT-registered company weighing deregistration; or an owner juggling several Bulgarian companies at once, some active, some asleep.

Useful next reads:

What closing a Bulgarian company looks like, step by step
How we manage several companies from one place
When you need an expert and what is included

FreeMe.bg is live: the "Sleeping Company" plan is €100 a year (annual billing only), covering one job, filing the declaration correctly and on time with the Commercial Register. Log in with your Google account and manage your company starting today.