Resources Taxing and accounting Social security contributions

Social security contributions

Every company in Bulgaria must have a manager and managers must pay security contributions. Again there are two general options:

1. registering as a freelancer and
2. paying security contributions based on monthly remuneration.

In the first option social security contributions amount to ~€65 per month while in the second option they amount to ~30% of the remuneration.

Example: David wants to withdraw €1000 from the company on a monthly basis. After taxes and social security contributions David will actually receive ~€640.

Which options grants the best tax optimization?
Well, it depends. Sometimes it will make more sense to distribute the profit while in different situation monthly remuneration will be the better option. Always consider taking an advice from accountant or a financial specialist. We have one readily available for some financial and taxation advice.