Taxes and Fees
The process of purchasing a property involves curtain costs, which are most often not mentioned in the prices of the properties. Recurring charges – these are unavoidable costs that follow the purchase – sale of real estate and include tax for acquisition of property under the local taxes and fees and registration fee and notary fee. They are determined on the basis of the agreed amount of the transaction.
- Local taxes and fees – this is a tax that is paid to the municipality at the location of the property. This tax was fixed at the rate of 2% of the property value recorded in the deed. After the recent changes, municipalities were given freedom to determine the amount of this tax and now it is different for the different municipalities in Bulgaria. In practice, this tax is more often calculated based on the assessed value of the property. The reason is that usually, it is lower than the market value of the property and thus saves paying higher taxes.
- The registration fee – 0.01% of the purchase price.
- Notary fees according to the purchase price – calculated in the following table: material interest (lev) Notary fee (in lev) 101 – 1000 30+ 1.5% for the amount over 100 lev 1001-10000 43,50 +1,3% for the amount above 1000 lev 10001-50000 160.50 + 0.8% for the excess over 10,000 lev 50001-100000 480.50 + 0.5% on the amount above 50 000 lev 100001-500000 730.50 + 0.2% on the amount above 100 000 lev 500 000 1530.50 + 0 , 1% of the amount above 500 000 lev, but not more than 6000 lev
- VAT – Some advertisements estate indicated prices do not include VAT, so buyers should make sure that the price of the property you are interested include value added tax. If the purchased property is used for business purposes and the new owner is a company or person registered for VAT, the buyer is entitled to submit the relevant documentation for VAT refund.
- Annual local taxes and fees for collection of household waste – are calculated based on the assessed value of the property and the amount is usually 0.1% of the evaluation. These taxes can be paid up to 30th April of the year with a 5% discount, or 4 equal instalments during the year.
- Maintenance fee of real estate – if you own or plan to buy a property in the saw called “Complexes”, or a flat in a well maintained building, you should know an annual fee is due for the maintenance of the common areas, and in some cases for security, maintenance of green areas, swimming pools and other facilities. This fee is strictly specific for the different complexes of this type.