Annual Property Taxes for Bulgarian Properties
We are often asked about property taxes in Bulgaria and like with many countries, annual property taxes do apply in Bulgaria. This is the bad news.
But the good news is that property taxes in Bulgaria are low. To give you a rough idea, a cottage that is valued at around 10 000 Euros will have an annual property tax of around 30 Euros. The higher the value of the house then this would translate into a higher annual tax. But nothing that will 'break the bank'. The taxes will also include a rubbish collection fee.
Whilst the property taxes in Bulgaria may be very low it is still important that they are paid and kept up to date. In this article we want to provide some further information about this process, how to pay it and what happens if it remains unpaid.
When you first purchase a property in Bulgaria, the new deeds for the house will be registered with the local municipality and the property tax department will update their records to show you as the new owner.
At the start of the year, property tax bills are sent out to all properties in Bulgaria. If you live aborad it is important to note that property tax bills will not be sent abroad to your home address. They are sent to your property in Bulgaria or to the mayor in the village if the house does not have a number.
It is therefore important to have someone check on the house for mail or go to the local municipality and pay the annual taxes on your behalf.
What happens if I don't pay my taxes?
Homeowners will have until the end of March to pay their property tax. After this point if it remains unpaid it will begin to accrue penalties. As of April 2020 these are calculated at 10% per month.
Penalties can accrue for anywhere between 2 and 4 years before a municipality will take further action which will usually involve passing the unpaid debt to a bailiff firm.
It's important to try and avoid this happening as bailiff fees are considerably more than the municipality penalties of 10%. A bailiff firm will attempt to find the individual of a property to inform them that there is unpaid tax due and to try and resolve the matter.
Can I lose my property?
It is important to note that Bulagrian law does not allow for a house to be repossessed due to unpaid property tax. However, a bailiff does have the legal authority to impose a court order on a property with unpaid taxes. Debts can suddenly jump from a couple of hundred Euros to well over a thousand if a bailiff takes control of the unpaid property taxes. And the costs will continue to climb each year it remains unpaid.
Having a court order on a house means it cannot be sold or ownership transferred until the debt is cleared.
To avoid this happening we recommend to all owners to ensure that they keep on top of their property taxes. You can do this by contacting the municipality nearest your property. In our area this tends to be Dobrich Municipality (www.dobrich.bg or tel: 00359 58 601 203). Alternatively have a trusted contact or local professional visit the municipality in person and pay the tax on your behalf. There are a number of property management companies (including ourselves) that do offer this service or include it as part of a package.