Income tax

One rate, no tax-free allowance

Personal income tax in Bulgaria is flat. A single rate of 10% applies to income from employment — the same 10% on the monthly advance withheld from each payslip and on the annual tax, under the Personal Income Tax Act (ЗДДФЛ), article 42 for the monthly advance and article 48 for the annual liability. There are no tax brackets and no progression: the rate does not change with the size of the salary. The figures on this page are those in force for 2026.

For most employees the whole calculation happens on the payslip, so there is nothing to file and nothing to reclaim. The employer computes the base, withholds the 10% and pays it over to the National Revenue Agency (НАП) — what reaches your account is already net of both tax and contributions.

The base is not the gross

The tax is not levied on the gross salary. The base is the taxable income: the gross reduced by the employee’s own mandatory social and health contributions. Because those contributions (13,78% of the insurable income) come off first, the 10% applies to a smaller figure than the headline gross. In sequence: gross, minus the employee contributions, gives the tax base; 10% of the base is the tax; gross minus contributions minus tax is the net pay.

Bulgaria has no tax-free allowance (необлагаем минимум) for ordinary employment income — no personal threshold below which income is untaxed. This is the single biggest difference from many other European systems, where the first slice of income is exempt. Here the flat 10% runs across the whole base from the first euro.

What is not in the monthly figure

A handful of reliefs reduce the tax, but almost all of them are annual, claimed after the year ends rather than month by month. The most common is the child tax relief: article 42(3), which governs the monthly advance, deliberately does not include it, so it never changes your monthly net. It is claimed later — through the employer’s year-end recalculation or the annual return — and this calculator therefore shows it as a separate yearly figure, not a monthly deduction. See the child tax relief page for how that works.

Why the rate has stayed put

The flat 10% has been a fixture of the Bulgarian system for well over a decade and is unchanged for 2026. The one structural change for the year is the currency: from 1 January 2026 Bulgaria uses the euro, so the base, the tax and the net are all expressed in euro. The rate itself is not affected by the changeover — a flat percentage is the same number whatever the currency.

The content of this page is being extended over time.