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Countervailing benefits introduced retroactively

Bulgaria: Simplified Taxation of Cost for Personal Use of Company Assets (Countervailing Benefits)

With retroactive effect to 1 January 2016, corporate employers and legal entities whose shareholders and/or partners work for the company in person have the choice how to tax accounting costs associated with private usage (without compensating the enterprise) of company assets by employees, board members and working shareholders. These expenses can now be subject to income taxation of individuals under the Bulgarian Income Tax for Individuals Act or to profit taxation under the Bulgarian Corporate Income Tax Act. The choice is made on a year-to-year basis together with filing the yearly tax return. The tax base under the Corporate Income Tax Act is the cumulative amount of respective accounting costs raised by the applicable VAT. The taxation rate is 10 percent.

Source: Bulgarian Act on Corporate Income Tax