Last Updated on June 28, 2022 by Bulgarian attorney
Capital increase of a Bulgarian company
There are various reasons why one should consider increasing the capital of his company. Obvious ones are reputation and credibility. More capital means you are serious about your business. A 2 EUR company capital can be considered too low for businesses that operate in manufacturing, construction, transportation, or other value-added businesses.
Building trust in the digital era is not only Google My Business reviews and FB ads. Building trust can be also business profiles and reports by organizations like Duns & Bradstreet where your financial data can be easily accessed. Duns & Bradstreet might be too much for a digital nomad, however, if you approach big clients or governments, your company financial and capital data will be analyzed in depth.
Capital increase of a Bulgarian company will improve your company image and eventually turn into more sales.
Increasing capital is decreasing tax
The capitalized profit does not mean that corporate tax will not be paid. However, you can save on the dividends tax. The dividends tax in Bulgaria is 5% of the amount left after paying corporate tax. For example, if your profit before taxation is 10,000 EUR minus 10% flat corporate tax the amount left is 9,000 EUR. The 5% dividends tax is calculated on the 9,000 EUR. In this modest example, the dividends tax is just 450 EUR.
The capitalized profit is not frozen in your accounts but can be disposed for other purposes related to company development.
How to increase the capital
Since the company is already incorporated, you are not required to open again a deposit account. Our team will assist you to increase the capital of your Bulgarian company hassle free.
How long does it take to increase the capital
The capital of your Bulgarian company will be increased within 5- 7 working days of receiving a certified Power of Attorney authorizing our team with the task.
For more details, please get in touch with our team.