Bulgaria vs. Italy: Tax Comparison
As an Italian entrepreneur, you are probably well aware of the challenges of high taxes and complex financial regulations in Italy. But what if there was a way to significantly reduce your tax burden while staying within the European Union?
Bulgaria, with its favourable tax system, is establishing itself as one of the most attractive alternatives for Italian companies.
In the following lines we will compare the tax regimes of Bulgaria and Italy to show why Bulgaria can be the key to managing your finances more efficiently.
💼 Corporate tax: 10% vs up to 27.9%
One of Bulgaria’s strongest advantages is the fixed corporate tax rate of 10% – one of the lowest rates in the entire European Union. This flat rate applies equally to all companies, regardless of their size or sector, which ensures predictability and stability in financial planning.
In Italy, the corporate tax (IRES) is 24%, to which is added the regional tax (IRAP) of around 3.9%, bringing the total tax burden to 27.9% or even more. Moving your business or part of your operations to Bulgaria can result in over 60% savings on corporate tax alone.
What does this mean for you? Lower corporate tax in Bulgaria allows you to keep more of your profits – money you can reinvest in innovation, expansion or new projects.
👤 Personal income tax
In Bulgaria, the personal income tax is also fixed at 10%, regardless of the amount of income. This makes the country extremely attractive for business owners, managers and employees looking for ways to reduce their personal tax burden.
By comparison, in Italy the income tax (IRPEF) is progressive – from 23% to 43%, often with regional and municipal taxes added. For high earners, this can result in a total tax burden exceeding 45%.
What does this mean for you? Lower rates in Bulgaria provide more disposable income for you and your employees, increasing the financial flexibility of your business.
💶VAT: Similar structure, but different governance
Both countries apply VAT in line with EU rules, but Bulgaria offers simpler administrative procedures. The standard rate is 20%, compared to 22% in Italy. VAT registration, reporting and recovery in Bulgaria are considerably faster and more transparent, especially for foreign companies.
Our accounting firm, fluent in Italian, will assist you every step of the way, from VAT registration to optimising refunds.
What does this mean for you? A lower VAT rate and our expert services mean less administrative burden and more savings for your business.
🧾 National insurance contributions: significant difference
Social security contributions in Bulgaria are among the lowest in the EU. The total rate (employer + employee) is around 32.7-33.4% of gross salary. In Italy this rate can reach 40% or more, depending on the sector and the size of the company.
This difference makes Bulgaria particularly advantageous for companies with large numbers of employees – such as manufacturing companies, IT firms or service centres.
What does this mean for you? Lower labour costs allow you to attract skilled professionals on more competitive terms without compromising on quality.
🚀 Easy start and support for Italian businesses
In addition to the tax advantages, Bulgaria offers a quick and clear procedure for company registration, as well as a stable legal framework as a member of the EU.
Our accounting firm specializes in servicing Italian clients – from company formation to full accounting and tax services.
🇧🇬 Why choose Bulgaria?
The tax comparison between Bulgaria and Italy clearly shows that Bulgaria offers real financial advantages:
✅ Corporate tax – only 10%
✅ Income tax – 10%
✅ Lower social security contributions
✅ Transparent and stable business environment
✅ Support from a team fluent in Italian
📞Ready to take the next step? Contact SAAD Consulting – your trusted partner in Bulgaria!