Bulgaria Rental Income Guide 2026
Rental income in Bulgaria is taxed at the flat 10% personal income tax rate. Landlords may deduct a 10% deemed expense without providing receipts, or deduct actual documented expenses.
Tax Rate for Individual Landlords
Rental income received by individuals is subject to the flat 10% IIT rate. This applies to residential and commercial property rentals.
Deemed Expense Deduction β 10%
Individual landlords can elect a 10% deemed expense deduction on gross rental income, which covers all associated costs (maintenance, management, insurance) without requiring receipts. Alternatively, actual documented expenses may be deducted.
Actual Expense Deduction
Instead of the 10% flat deduction, landlords may deduct actual costs such as repairs, maintenance, property management fees, insurance, municipal taxes, and mortgage interest. Receipts and documentation must be maintained.
Corporate Rental Income
Companies earning rental income pay 10% CIT on net rental profits after deducting actual expenses (depreciation, interest, maintenance, management). Bulgaria's low CIT makes corporate property holding tax-efficient.
Short-Term Rentals (Airbnb)
Income from short-term lettings (e.g., Airbnb, Booking.com) is taxable as rental income at 10%. If the activity qualifies as a business, registration as a sole trader may be required. VAT at 9% may apply to accommodation services.
Filing and Payment
Rental income must be declared on the annual personal tax return by April 30. No withholding tax applies; landlords pay directly to the NRA.