We review the procedure and evidence, coordinate correspondence with the tax authority and prepare objections or appeal documents where appropriate.
A client came to ARG with questions about an NRA tax audit and possible appeal. From the outset, the client wanted the work organised around the returns, supporting documents and decisions that would follow, rather than handled as isolated correspondence.
ARG connected the technical advice with the available records and the procedural stages of the case. The completed work left the client with a more coherent file and a process that could continue to be maintained. That distinction matters because a formal audit, an audit report and an audit act each require a different response.
ARG can help when you need to
Send the complete NRA order, request, report or assessment with annexes and proof of service. The type of document and service date determine the next action and deadline.
Identify each tax, period, transaction and amount under review. Separate the company’s liabilities from any proposed personal liability of an owner or manager.
Prepare returns, ledgers, contracts, performance evidence and payment records. Foreign income and transfers need proof of their source and a clear link to the relevant period.
Report objections and assessment appeals usually have separate fourteen-day periods. An appeal does not automatically suspend collection; assess any security and suspension request promptly.
A Bulgarian tax audit, called a ревизия, is a formal procedure through which the National Revenue Agency (NRA or НАП) establishes tax and mandatory social-insurance liabilities. It begins with an audit assignment order identifying the person, tax periods, liabilities, responsible officials and duration. The Tax and Social Insurance Procedure Code (ДОПК) governs this process. Check the order and its service record as soon as they arrive: they define the starting scope and the timetable for your response. The NRA explains the ordinary audit procedure.
A проверка, or inspection, is also a formal control activity. It can gather facts and evidence without itself determining tax liabilities through an audit assessment. A document request should therefore never be dismissed as informal simply because no audit order accompanies it. Identify the procedure, the legal basis of the request and the deadline. Evidence supplied during an inspection can later be used in an audit, so the explanation should already match the contracts, payments and returns.
The first decision is which document you have received: an inspection request, an audit order, a request for evidence, an audit report or the final assessment. Each has a different function. A report proposes findings and opens an objection period; an assessment establishes liabilities and opens a separate appeal period. Forward the full document and proof of service together, including its annexes, rather than sending only a screenshot of the amount demanded.
Within this service, ARG would first map the document you received against the formal audit markers. That means checking whether there is an audit assignment order, what period and liabilities it covers, and whether the request for documents is part of that audit file or just a separate correspondence step. The purpose is to avoid over-answering, under-answering, or sending materials that are not aligned with the actual procedural stage.
A useful way to think about the difference is this.
If your file is already in audit status, the issue is not only whether you have the right documents. It is whether the documents tell a consistent and defensible story under the procedural rules of the NRA and the ДОПК.
Opening the electronic service link can be legally significant for service. Keep the notification and download record, and tell the person managing the case when the document became available and when it was opened. Moving correspondence to another colleague does not restart a deadline.
An Article 122 assessment under the ДОПК is not used in every audit. It is a higher-risk method for cases where the file shows one of the statutory trigger situations, and that changes both the evidentiary strategy and the urgency of the response.
Article 122 of the ДОПК allows the NRA to determine the tax base by indirect methods when the facts in the file fit one of the listed special-risk situations. The statute covers, among others, missing declarations before the audit starts, hidden income, false documents, missing or unusable accounting records, missing or damaged documents, inability to locate the person at the correspondence address, and a clear mismatch between declared resources and actual wealth. That is a significant shift, because the authority is no longer limited to reading the taxpayer’s own books at face value. It can reconstruct the base from surrounding facts and comparables. Article 122 ДОПК
The key point is not that the NRA may use indirect evidence whenever it wishes. It may do so when the file contains a statutory trigger. In practical terms, the trigger often appears where the authority sees missing records, inconsistent filings, unexplained cash or bank movements, or a gap between lifestyle, assets, and declared resources. The code also allows reliance on a broad range of surrounding indicators, including bank movements, contracts, market value, living expenses, deliveries, and similar comparables.
That matters because the client’s defence must then address the factual mismatch, not just the legal conclusion. If the NRA says the records are unreliable, the response cannot stop at a general denial. It has to show why the records are complete, why a transaction was structured as shown, or why a movement of funds has a documented source and purpose.
The procedural safeguard is also important. When Article 122 is used, the authority must notify the audited person and give at least 14 days to submit evidence and a statement. That is the first real opportunity to contest the indirect-method path before it hardens into a tax calculation. If you receive such a notice, the immediate task is to build a defensive evidence file around the specific trigger, not to assume that a later explanation will be enough.
For a client, the commercial meaning is straightforward. Article 122 is usually the point at which a standard audit becomes a documentation and narrative case. ARG’s value in this part of the service is to identify the trigger early, organise the evidence around it, and avoid leaving the NRA with an unchallenged basis for indirect assessment. If the trigger is present, the safest next step is to treat the file as a rebuttal exercise, not as a routine answer to a correspondence request.
An Article 122 case requires two connected responses. First, examine whether the statutory ground for using the special method is established. Second, check the calculation produced from the evidence: opening resources, bank movements, assets acquired, business receipts and expenditure can require reconciliation. Article 124(2) gives the assessment’s factual findings a rebuttable presumption in an appeal only where the Article 122 ground is supported by evidence. This makes a specific documentary answer important. It does not make an estimated amount automatically correct or prevent you from challenging the assumptions and arithmetic. Articles 122–124 of the Code set out this relationship.
Once Article 122 is in play, the authority is not limited to one document or one ledger. The statute allows it to rely on a wide range of relevant factors, including bank movements, contracts, market value, living expenses, deliveries, and other comparable indicators. That matters because the case is then built from the whole factual picture. A bank transfer that was not explained, a contract that does not match the payment trail, or living costs that exceed the declared income can all become part of the reconstruction.
This is why clients often misread the risk. They assume the issue is only whether one invoice is missing. In reality, the authority may test whether the entire economic story is coherent. If the documentation does not support the declared position, the NRA may argue that the missing or unreliable records make indirect assessment justified.
When the NRA uses Article 122, it must notify the audited person and give at least 14 days to submit evidence and a statement. That period is not a formality. It is the first chance to explain the factual trigger, fill evidentiary gaps, and prevent the authority from treating silence as acceptance. The evidence rule in the ДОПК is also practical. If requested evidence is not produced, the authority may treat it as non-existent and decide on the evidence available. So if the client has bank statements, contracts, explanations for transfers, or records showing the source of funds, those materials need to be organised quickly and tied to the specific issue the NRA is raising.
In working terms, the question is whether the file can show a credible path from the declared position to the actual facts. If the answer is yes, the response should be built around that path. If the answer is no, the service becomes more urgent, because the indirect-method framework can turn a documentation gap into a tax base estimate.
The real decision at this stage is whether to prepare a defensive evidence package immediately. If the file contains one of the Article 122 triggers, the safest approach is to assume that the NRA will look beyond the accounting entries and test the wider financial pattern. That means reconciling returns, contracts, payments, bank movement, and the source of assets or spending before the authority does it for you.
For example, a transfer into your Bulgarian account may be proceeds from selling an overseas asset, repayment of a documented loan, a gift or income from work. Those possibilities have different tax consequences. Supply the sale agreement or loan records, the source account statements and the movement into Bulgaria, then reconcile the amount to the return where relevant. Describing every inflow as “personal savings” without an opening balance or supporting history does not explain how the funds arose.
For that reason, this service is most valuable when the client needs to respond fast and coherently to a suspected indirect-assessment case. The objective is to stop the audit from becoming a one-sided reconstruction and to force the NRA to deal with the documented explanation rather than an unexplained gap.
Create an index linking each NRA question to the document and page that answers it. Record the original language, issuer, period and whether the source can supply an original or certified copy if requested. A translation makes the content readable but does not establish that a service was performed or that money belonged to you. For a disputed business payment, connect the contract, delivery or work evidence, invoice, bank movement and accounting treatment. For personal resources, trace the legal source and the earlier movement of funds rather than only the final transfer.
If a third party needs more time to supply records, request an extension before the existing deadline and explain which records are outstanding and why. Do not assume that asking suspends the deadline. Keep a copy of what was submitted, the submission receipt and the authority’s response. The NRA guidance on evidence and time extensions explains these procedural steps.
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.
After the audit report is served, the response becomes time sensitive and document driven. Under the Bulgarian Tax and Social Insurance Procedure Code ДОПК, the audited person has 14 days from service to file a written objection and supporting evidence. That is the stage for correcting the factual record before the audit act is issued. The report itself must be prepared within 14 days after the audit deadline expires and then served within 3 days, so the file normally moves quickly from factual review to formal objection rights.
ARG would treat this stage as a prioritisation exercise, not as a general explanation of the business. The practical task is to reconcile the tax returns, accounting records, contracts, payment trail and written explanations, then decide which points need a direct rebuttal and which ones need documentary support. If one invoice, transfer or contract term is the source of the dispute, the response should anchor on that item and show why the NRA should read it differently. If the problem is broader, the objection should rebuild the sequence of events so that the report cannot be read as a set of isolated inconsistencies.
A useful working file normally starts with the documents that control the chronology.
The reason to start there is simple. The NRA may treat evidence that is requested but not produced as non-existent and decide on the material available. That makes the 14 day period a real evidentiary window, not a courtesy. If the papers are spread across accounting, legal and operational teams, the first job is to close the gaps before drafting the objection.
The code also allows the 14 day period to be extended by up to one month on request. That matters when the response depends on third party records, archive retrieval or a coordinated factual explanation that cannot be assembled safely in a few days. In practice, the request for extension should be made early, before the deadline becomes the issue itself.
A simple example shows the commercial effect. If the report questions the source of funds for a payment chain, the objection should not just deny the conclusion. It should attach the contract, bank trail and a short explanation showing where the money came from, why it moved that way and how the accounting entry follows the underlying transaction. That is the difference between an unstructured reply and a file that can still be defended later.
For a client, this stage is about protecting the record before it hardens into the audit act. ARG’s role is to turn the report into a managed response file so the final act is not built on unanswered contradictions.
The audit assessment, or ревизионен акт, can be challenged wholly or in specified parts within fourteen days of service. The administrative appeal is submitted through the competent territorial directorate to the relevant director of the NRA Appeals and Tax and Social Insurance Practice Directorate, known by the Bulgarian abbreviation ОДОП. This is a separate step from objecting to the report. Identify the taxes, periods and amounts contested, the correction requested and the evidence for each ground. The NRA describes the appeal route.
ARG would approach the appeal by separating three questions. First, whether the NRA used the correct legal route and respected the procedural steps. Second, whether the evidence supports the liability stated in the act. Third, whether the reasoning actually follows from the documents. That division matters because a good appeal is not only a disagreement with the amount. It is a structured attack on the legal basis, the evidential chain and any misuse of the file.
The administrative appeal does not stop enforcement. So even if the challenge is well founded, the taxpayer cannot assume that collection activity pauses automatically. That is one of the main reasons to prepare the appeal file with the enforcement risk in mind. If there is a cash flow issue, asset exposure or a need to preserve access to bank accounts and trading activity, the appeal strategy should be coordinated with the wider commercial response.
If the administrative appeal is not decided in time, the act is treated as confirmed in the contested part. The client may then go to court within 30 days from expiry of the decision period. If the administrative decision is actually issued, the court appeal deadline is 14 days from receipt of that decision. This creates a clear sequence.
That sequence is important because the later court route is not a substitute for missing the administrative one. The administrative stage is where the file is still inside the NRA system and where factual and legal points can sometimes be narrowed before litigation.
The practical rule is to challenge the act fast, because delay narrows the options and does not stop enforcement.
For a client, the decision is whether the act can be attacked by a focused administrative case or whether the appeal must already be prepared as the opening move in a court dispute. ARG’s value here is in selecting the route that fits the evidence, the timing and the enforcement risk, not in treating every act as the same kind of dispute.
Keep the legal deadline separate from the availability of an electronic service. A portal window is a filing channel, not a rule extending the time to object or appeal. If access fails, record the error, check another legally available submission route immediately and retain proof of timely filing. Equally, an unanswered document request should be addressed even where the original deadline has passed: determine whether the evidence can still be considered at the current procedural stage.
The consequences of lateness differ. Missing a requested-document deadline can expose the taxpayer to a sanction while later evidence may still need to be considered within the applicable audit stage. Missing the report-objection period does not automatically remove the right to appeal the eventual assessment. Missing the administrative appeal deadline can affect access to judicial review. Establish which deadline was missed and whether service was valid before deciding what procedural step remains available.
The administrative appeal does not stop enforcement. That rule matters for liquidity, bank relations and day to day operations. A client may have a valid challenge and still need to manage the immediate collection risk at the same time. For that reason, the appeal should not be drafted as a purely legal memo. It should be prepared as part of a broader response plan that also considers document access, accounting continuity and the ability to keep trading during the dispute.
If a deadline appears to have passed, obtain the full service record and check the recipient, electronic access event and any authorised extension. Then identify the available remedy under the Code; an exceptional remedy requires its own conditions and cannot be assumed to replace an ordinary appeal. Preserve the records rather than altering dates or trying to backdate a response. At the same time, review the assessed payment and any enforcement notices, because resolving the appeal question alone does not resolve collection exposure.
For this service, the practical implication is clear. ARG is most valuable when the client needs to keep the NRA file moving while protecting the right to challenge it. If the correspondence window, objection period or appeal deadline is approaching, the decision is no longer abstract. It is whether to act immediately so the record stays open for challenge and enforcement exposure is managed on the same timetable.
An administrative appeal does not itself suspend enforcement. Article 153 allows a separate request concerning the disputed part, supported by security for the principal and interest or a proposal for that security. Cash, an unconditional irrevocable bank guarantee and government securities have specific treatment; other proposed assets require assessment under the statutory rules. Prepare the current liability calculation and evidence of available security alongside the appeal rather than waiting for a collection measure. Article 153 governs the administrative-stage request; judicial-stage suspension has its own procedure under Article 157.
The deciding authority’s response also needs a diary entry. If a decision is served, the ordinary court-appeal period is fourteen days from receipt. If no decision is issued within the applicable decision period, Article 156 provides a thirty-day court window after that period expires. Calculate the expiry from the actual procedural record, including any legally relevant correction or extension, instead of assuming silence keeps the case open indefinitely.
Compare the related procedures in this category, including their requirements and the stage at which you need them.
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