We compare personal and company ownership, organise a special-purpose company where appropriate and document control over assets and ownership interests.
ARG worked with a client who wanted their asset-holding and property-company arrangements documented properly from the beginning. The client brought personal, property and financial records together, and ARG organised them into a coherent file for the work.
Once the task was complete, the documents were easier to navigate and the client had a process for keeping the file in order. That practical foundation matters because a Bulgarian property SPV is usually an ordinary limited liability company used for a defined purpose, not a separate legal form. The right setup therefore depends on the intended assets, ownership chain and future use.
ARG can help when you need to
Explain the asset, investors, financing and intended exit. A holding company adds governance and accounting duties; its label alone creates no licence or tax exemption.
Identify every relevant entity and the natural persons who ultimately own or control it. Include representatives, voting arrangements and documents connecting the ownership chain.
Explain each source of the price and allow time for bank checks. If borrowing or selling investments, establish when the funds can actually be released.
Identify the accountant, manager and filing responsibilities before acquiring assets through a company. Keep personal spending, company funds and shareholder loans separately documented.
An SPV, or special-purpose vehicle, describes a company organised for a defined asset or project. It is not automatically a separate Bulgarian legal form or an investment licence. A privately owned EOOD or OOD holding a property should not be confused with a regulated special-investment-purpose company or a fund. The intended activity, sources of capital and services supplied to others determine whether additional regulation is relevant.
When the company buys an asset, the company becomes owner. The shareholder owns shares, not the company's apartment or bank account directly. This can make co-investment, management and transfer of ownership interests easier, but it introduces company accounts, decisions, filings and a separate tax position. Limited liability is not an assurance that the asset is protected from the company's own creditors or a shareholder's personal guarantees. Registry Agency: company registration.
Before incorporation, decide who owns the shares, who manages, which decisions require investor consent and how capital enters and leaves. Distinguish paid-in capital, shareholder loans, third-party finance and distributions. Record beneficial ownership through the whole control chain. A nominee or foreign parent does not remove disclosure obligations or a bank's need to understand the natural persons who ultimately own or control the structure.
Compare an asset sale with a share sale, personal use with commercial letting and the consequences of death or disagreement between investors. Funding and exit documents should address those scenarios before the asset is acquired. ARG coordinates the corporate, property and accounting work with the relevant professionals. The structure should solve a defined ownership or governance problem at an acceptable ongoing cost; the label SPV alone gives neither tax relief nor unrestricted access to every category of Bulgarian land.
An EOOD is a limited liability company with one owner; an OOD has more than one member. Both have their own legal identity and own the assets registered in their name. The founding documents identify the owner or members, capital, registered office, business purpose and management. A foreign individual or company can participate, but the ownership chain, corporate authority and intended asset still need a separate eligibility review.
Registration takes place in the Commercial Register maintained by the Registry Agency. Article 23 of the Commercial Register Act provides for the unique identification code, EIK. An ordinary Bulgarian EOOD or OOD does not obtain its legal identity through a second, general BULSTAT company registration. VAT registration, employer obligations and property entries concern different legal duties; they should not be described as interchangeable company-number applications. Commercial Register Act, Article 23.
Prepare identification documents, the founding act or articles, the owner's or members' decisions, management consent and the required declarations. Where a foreign company is the member, establish its current existence and who can bind it, including the corporate approval for the Bulgarian investment. Foreign documents may need authentication and Bulgarian translation. Have the registration documents and bank onboarding file use exactly the same ownership and representation information.
Decide the governance before submitting a standard form. Two equal investors need an agreed response to a blocked budget, a refinancing request or one investor wishing to leave. If the manager is abroad, plan how instructions and signatures will be given without circulating unrestricted powers. After entry, the company needs an operating bank arrangement, accounting engagement and a reliable address for official correspondence before it signs the acquisition contract.
In Bulgaria, an apartment, the building, the plot underneath it and a right to build on somebody else's land can be separate legal interests. A listing that promises a house with a garden does not establish that the seller owns both. A parking space may be a separate property, an ideal share of a garage or only an agreed right of use. These differences affect resale, mortgage security and who can prevent you using an area you thought was included.
For a foreign buyer, identify the land element before choosing the purchaser. Article 22 of the Constitution governs acquisition of land by foreign persons through the applicable EU-accession arrangements, an effective international treaty or inheritance by law. Buying a building is not the same question as acquiring the land. A residence card alone does not settle the issue. Agricultural land also has a separate legal regime and needs its own eligibility and use analysis. Constitution, Article 22.
Ask for the complete title deed and cadastral documents, including annexes, garage and storage identifiers, shares in common parts and any building right. Compare that legal description with the floor plan, advertisement and proposed price. If a Bulgarian company is being considered as owner, review its ownership chain and the particular land restrictions before incorporation; a company is not a universal answer for every plot. ARG coordinates this classification before the purchaser pays a reservation fee, so the agreement describes the rights that can actually be transferred.
An ideal share is a fraction of the ownership right, not necessarily an exclusively owned physical corner of the plot or garage. If you expect sole use of a garden or parking area, examine the separate legal basis for that use and its effect on future owners. Ask who can change the arrangement and whether access depends on another property. These questions matter even when the fraction and the purchase price are clearly stated in the deed.
A foreign owner adds a chain of legal capacity and control to the property vehicle. Establish the foreign entity's current existence, legal form, registered representation and authority to invest. Obtain the relevant constitutional documents and decisions, not just a certificate naming the entity. Where several companies intervene, follow the chain to the natural persons who ultimately own or control it and explain any control that does not follow ordinary share percentages.
Bulgarian anti-money-laundering rules require identification of beneficial ownership, including the relevant people behind trust and similar arrangements. A settlor provides the assets, trustees administer them, a protector may hold supervisory powers and beneficiaries receive or may receive the benefit; other persons can exercise ultimate control. A chart showing only a trustee company can therefore leave essential parts of the control and benefit structure unanswered. Bulgarian Measures Against Money Laundering Act.
The foreign trust's treatment in its home jurisdiction does not by itself decide Bulgarian ownership, registration, tax or succession consequences. Identify who will be named as owner of the Bulgarian company interest, who signs, which law governs the arrangement and what powers permit the proposed acquisition or distribution. Provide the trust instrument or appropriate extracts and supporting professional documentation through a controlled disclosure process when required.
Compare the same structure across the company register, bank onboarding, tax analysis and succession plan. Differences should be explained rather than concealed by different simplified charts. ARG coordinates document requests with the foreign advisers and Bulgarian legal partner. The objective is a structure that the relevant institutions can understand and administer, with a clear account of authority, economic benefit and future changes, rather than assuming that a foreign label automatically creates a recognised Bulgarian property or tax outcome.
Source of funds explains the economic origin of the money for a particular transaction. Source of wealth explains how the person accumulated their broader assets. The sending bank's name establishes a transfer route, not necessarily either source. Moving your own money between accounts does not create new wealth and does not, by itself, prove how the money was earned.
For a property payment funded by a business sale, show the sale agreement, your ownership of the interest sold, completion evidence and the receipt and onward movement of proceeds. If the purchaser paid in instalments, reconcile those amounts with the balance now available. For salary savings, employment and income records should fit the period over which the savings arose. For inheritance, link the estate documents to your entitlement, distribution and receipt. Bulgarian Measures Against Money Laundering Act.
A mixed payment needs a split explanation. Identify the amount from each source, the documents proving it and the account through which it moved. If a family member contributes, state whether the money is a gift, loan or payment on your behalf and provide the relevant evidence for that person where requested. Calling all incoming money “savings” can conceal the very distinction the reviewer needs to understand.
ARG helps arrange a chronological, document-supported explanation directed to the proposed transaction. The aim is not a persuasive story detached from the records but a file in which the reviewer can follow each material step. Where wealth arose many years ago, identify the original event and the surviving independent evidence. A declaration can have a role under the law, but it should not be treated as an automatic replacement for available underlying documents.
Borrowing requires its own evidence chain. The loan agreement explains the repayment obligation, while the lender’s payment and your account receipt establish disbursement. A related-party lender may also need to explain its ability to advance the amount. Distinguish an approved facility from money already drawn and available. Loan proceeds can fund a purchase but do not represent an equal increase in your net wealth, because the repayment liability remains. Include that liability when explaining the overall financial profile and do not describe borrowed funds as earned income.
Tell us where you live, how your business works and what you want to change. We will help you identify the questions to resolve and the next steps to consider.
An ordinary Bulgarian property-holding company generally pays corporate income tax at ten percent on taxable profit under Article 20 of the Corporate Income Tax Act. Taxable profit is not the year's bank balance and not simply gross rent minus every payment. Accounting profit is adjusted under the tax rules. Acquisition expenditure, depreciation, financing charges, improvements and current repairs therefore need proper classification before the investor can compare company ownership with personal ownership.
The corporate-tax exemption available to specifically regulated special-investment-purpose companies does not automatically apply to a private EOOD merely because its shareholder calls it an SPV. Likewise, an individual's exemption for selling a qualifying home after the required holding period is not a general exemption for a company's property sale. Keep the company's taxable asset disposal separate from a shareholder's sale of shares or later distribution of company profits. NRA: corporate tax.
Agree an accounting handover from the first deposit. Give the accountant the purchase deed, invoices, loan agreements, completion statement and allocation between land, building and other assets. Land and depreciable assets require different treatment. For development or substantial refurbishment, identify which spending creates or improves an asset and which relates to its continuing operation. Supplier invoices should identify the company that incurred the cost, rather than the shareholder who happened to arrange it.
Before renting the apartment to a family member or using it personally, document the arrangement and examine the related-party and personal-benefit consequences. Paying a private household bill from the company account does not make it a deductible business expense. Maintain a forecast covering tax, debt service and maintenance before calculating distributable cash. The annual corporate return and payment normally fall due by 30 June of the following year; interim obligations and financial-statement publication require their own calendar.
Each source of money creates a different legal claim. Share capital represents the owner's equity interest. A documented shareholder loan makes the shareholder a creditor on its agreed terms. A bank facility introduces lender conditions, security and repayment covenants. Calling every transfer an investment obscures whether the company must repay it, whether interest accrues and whether the lender has priority over another creditor.
Corporate tax analysis considers the actual financing arrangement, including related-party pricing and the applicable limits on interest deductibility. A payment described as interest is not necessarily deductible in full. A cross-border lender can introduce withholding-tax and treaty questions. Establish the lender's legal identity, tax residence and entitlement to relief before the company makes the first interest payment, rather than attempting to correct the documentation after a withholding deadline. NRA: corporate tax.
Prepare the loan agreement, corporate approval, drawdown instructions, repayment schedule and explanation of the source of funds. Where the bank will fund only part of the price, reconcile its valuation, the buyer's contribution and the payment conditions in the preliminary contract. Security over the property and any personal guarantee should be reviewed separately: a limited liability company does not remove a liability that the investor voluntarily assumes under a guarantee.
Model a period with no rent or a delayed sale. The SPV still has insurance, accounting and property costs even if the investment is temporarily unproductive. Decide whether additional funding is obligatory, optional or subject to unanimous consent, and what happens if one shareholder cannot contribute. Repayment of a genuine loan and distribution of profit are different transactions; each withdrawal needs the appropriate legal and accounting basis. ARG coordinates the financing documents with the bank, legal adviser and accountant so the cash movements match the structure the investor has approved.
The registered manager represents the company; the shareholder's ownership does not mean that every supplier, tenant or bank will accept informal instructions from that shareholder. Check the registered representation and the internal approval rules together. For a jointly owned property vehicle, decide who may approve leases, major repairs, new borrowing, guarantees, related-party transactions and the eventual sale of the asset.
The Commercial Register provides the company's public representation record and registered documents. Internal restrictions and bank signing arrangements serve different purposes and should not be assumed to have identical effects against third parties. A shareholders' agreement also needs to work with the company's articles and mandatory company law. Resolve these relationships before granting access to the operating account or allowing one investor to instruct contractors alone. Commercial Register Act, Article 23.
Create an approval matrix with an ordinary operating budget and specific matters reserved for the owners. Require a documented decision for a substantial change in strategy, such as converting a long-term rental property into short-stay accommodation or mortgaging it to support another business. Include the financial information needed to decide: current cash, expected repairs, arrears, lender requirements and any tax consequences. An approval is meaningful only if the person giving it can see the relevant facts.
Plan changes in people as well as changes in assets. If a manager resigns, an investor dies or a foreign parent changes ownership, the company may need new decisions, register updates and renewed banking information. Identify who keeps the originals and who can access accounting and lease records without relying on one person's private email. ARG coordinates a handover that allows the corporate vehicle to continue operating while the legal partner implements the required changes in ownership or representation.
An asset sale and a share sale deliver different things. In an asset sale, the company sells its property and remains in existence with the proceeds and any remaining liabilities. In a share sale, the buyer acquires the company, which continues to own the property and remains responsible for its history. A buyer of shares will therefore investigate accounts, taxes, contracts, financing, litigation and beneficial ownership as well as the property's title.
Calculate the tax and cash consequences for both the company and the investor. A profitable asset sale can create corporate tax, and moving the remaining money to the shareholder requires a separate lawful route. A share disposal has its own seller-specific tax treatment. Repaying a properly documented shareholder loan, declaring a dividend and distributing a liquidation surplus cannot be treated as interchangeable descriptions for the same bank transfer. NRA: corporate tax.
Before marketing the investment, identify lender consent, early-repayment charges, tenant rights, guarantees and restrictions in the corporate documents. Prepare a clean data room with the ownership record, purchase history, major improvements, accounts, tax filings, leases and evidence of rent received. Resolve balances owed to or by shareholders. Unexplained company payments for private expenses are likely to become a price adjustment or a purchaser's demand for protection.
If the company will no longer be needed, selling the property does not itself close it. A formal winding-up process involves creditor protection, tax and accounting work and the final corporate steps. A transfer to a family member also needs valuation, corporate formalities and a tax review; it is not achieved by simply handing over the keys. ARG coordinates the exit timetable so the investor knows when sale proceeds arrive, which obligations must be settled and when funds can actually be withdrawn.
VAT treatment depends on the transaction, the supplier and the use of the property. It is separate from corporate income tax and municipal acquisition tax. A price described as exclusive of VAT can therefore produce a different cash requirement from the same nominal price stated as inclusive. Establish the seller's position and the treatment of deposits before agreeing the payment schedule.
Article 45 of the Bulgarian VAT Act distinguishes land, regulated development plots, building rights, new and non-new buildings and different forms of letting. The exemption for residential letting to an individual who is not a trader is not a general exemption for commercial premises or accommodation services. The Act also permits an election to tax certain otherwise exempt property supplies. An old building's appearance alone does not settle the legal classification of the whole transaction. VAT Act, Article 45.
Before treating VAT as recoverable, identify the buyer's registration position and the activities for which the acquired asset will actually be used. Taxable business use, exempt letting and private occupation can have different input-tax consequences. A later change of use or disposal can require a correction. A forecast that assumes immediate full recovery should therefore be tested against the intended operating model, invoices and documentary conditions.
Have the tax adviser prepare the VAT assumptions alongside the property contract and financing plan. Distinguish price, tax charged, recoverable tax and any amount that remains a cost. For mixed assets, make clear what is transferred with the unit, including land, parking and separate equipment. ARG coordinates these questions before signing so neither a company structure nor a seller's short description substitutes for a transaction-specific VAT calculation.
A company's bank balance belongs to the company. A shareholder needs a lawful basis for receiving money: a dividend, remuneration, loan repayment, reimbursement or another properly documented transaction. Each has different corporate, accounting and personal-tax consequences. Describing a transfer as an owner's withdrawal does not determine its treatment.
For individual dividend income, the Bulgarian Personal Income Tax Act provides a five-percent final-tax rate under Article 46(3), subject to the relevant domestic and treaty analysis. The supplementary definition of dividend also connects to concealed profit distribution. Payments to an owner or related person that do not reflect a genuine business purpose or market terms can therefore require review even where no formal dividend was declared. NRA: dividend definitions and tax.
Before distributing, confirm the available distributable result, the competent corporate decision and any restrictions arising from financing or the company's position. The company and the individual have different tax and reporting responsibilities. A Bulgarian-resident individual's foreign dividend may require personal reporting even though a Bulgarian company ordinarily handles withholding on its own distribution. Preserve gross amounts and foreign tax evidence, not only the net bank receipt.
For the bank file, connect the shareholder's ownership to the company accounts, distribution decision, tax treatment and payment. For a shareholder loan, keep the original loan agreement and movements showing that the amount repaid was actually advanced. ARG coordinates these records with the accountant and legal adviser so that the source-of-funds explanation and financial statements agree. This is especially useful before a property purchase: the company may have sufficient cash while the individual has not yet lawfully received funds available to complete.
A construction permit, разрешение за строеж, authorises the specified works under the Bulgarian Spatial Development Act. The applicant must have the appropriate developer status, such as ownership or a valid right to build on another person's land. Buying shares in a company or signing a preliminary purchase agreement does not by itself establish that the person filing the application holds the required development right.
The planning sequence includes an effective detailed development plan where required and, for a regulated plot, its application under the relevant rules. A design visa, виза за проектиране, records applicable planning parameters and is required in the statutory cases. It is not an immigration document or a construction permit. The investment designs, conformity assessment, network arrangements and relevant special-law approvals then form the permit file for the actual project. Ministry: construction-permit procedure.
Ask the architect to identify which part of the business plan is supported by existing permissions and which depends on a new decision. A warehouse conversion may require different fire-safety, loading, access or use arrangements from the existing building. Obtain a schedule of dependencies, including land-use changes, access rights, utility capacity and any environmental procedure. Statutory processing periods for a complete request should not be presented as the total time needed to acquire, design and open the project.
Tie the acquisition commitments to this technical position. Where a crucial approval remains outstanding, define the required evidence, responsible party, deadline and consequences in the transaction documents. ARG coordinates the legal and technical work so the property budget includes the project that can actually be implemented, with a clear distinction between a seller's concept drawing, an approved design and a permit that can lawfully be acted upon.
Compare the related procedures in this category, including their requirements and the stage at which you need them.
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