Year-end close for 2026: the first full year in euro — a checklist
2026 is the first financial year Bulgarian companies keep entirely in euro, which makes this year-end close different from usual. Here is what to do in November and December to avoid surprises in your tax bill and accounts.
- 2025 annual accounts were prepared in leva; 2026 accounts are in euro, with comparatives restated.
- Share capital must be converted in the Commercial Register by 31 December 2026 at the latest.
- The corporate tax return and payment are due by 30 June.
- Starting in November saves corrections and unpleasant tax surprises.
What is different this year
- The first full year in euro. The 2025 accounts were prepared in leva. In the 2026 accounts, the 2025 comparatives are converted to euro at the fixed rate of BGN 1.95583 to €1 and rounded to the cent.
- Share capital conversion. The Registry Agency converted capital automatically, but the updated articles of association must be filed by 31 December 2026 at the latest — with no state fee. If you haven't done it yet, see the euro checklist.
- New thresholds during the year. The maximum insurable income changed on 1 August and the VAT threshold is now tracked per calendar year. Reconciliations need to reflect both.
Preparation timeline
| When | What |
|---|---|
| November | Preliminary profit and tax estimate. Decisions on costs, investments, bonuses and write-offs before year end. |
| December | Stock-take of goods, cash and assets. Balance confirmations with key customers and suppliers. |
| January–February | Final documents for the year, accruals, depreciation, provisions for unused leave. |
| March–June | Tax adjustments, draft accounts, corporate tax return and payment by 30 June. Dormant company declaration by 30 June. |
| After the accounts are adopted | Publication in the Commercial Register on time and, if you decide to, a dividend. |
Stock-takes and reconciliations
A year-end close is only as good as the balances. Before thinking about tax, check:
- Cash — does the physical count match the books?
- Bank accounts — all of them, including payment providers and card accounts.
- Stock and materials — quantities, damaged goods, shortages and surpluses, documented in a protocol.
- Receivables and payables — old unpaid invoices, advances, loans from the owner.
- Fixed assets — anything sold, scrapped or no longer in use?
Tax adjustments that are often missed
- Costs without a document or business link — not deductible.
- The owner's personal expenses paid by the company — not deductible and potentially treated as a hidden profit distribution.
- Fines and penalties to the state — do not reduce taxable profit.
- Accruals for unused leave — deductible for tax when paid (a temporary difference).
- Impairment of receivables and stock — usually temporary differences with specific recognition rules.
- Entertainment expenses — subject to a 10% tax on expenses.
Corporate tax and advance payments
Corporate income tax is 10% of taxable profit. If you paid advance instalments during the year, the return shows the balance to pay or reclaim. Estimating the tax in November lets you plan cash flow instead of looking for funds in June.
Dividends
Profit can be distributed once the annual financial statements are adopted. Dividend tax for individuals is 5% and is withheld by the company. It is paid by the end of the month following the month of the distribution decision, and the Art. 55 PITA return is filed by the end of the month following the quarter.
Owner's checklist
- All 2026 documents sent by the end of January.
- Stock-take protocols for goods and cash in place.
- Balances confirmed with main customers and suppliers.
- Share capital converted and the articles filed.
- You know the estimated tax and have built it into your cash flow.
- You have decided whether and when to pay a dividend.
Frequently asked questions
Which currency are the 2026 accounts in?
Euro. The 2025 comparatives, which were in leva, are converted to euro at the fixed rate of 1.95583 and rounded to the cent.
When should I start preparing?
Ideally in November. Decisions that affect tax — costs, investments, write-offs, bonuses — must be taken by 31 December.
What if the company had no activity?
A declaration of no activity is filed by 30 June instead of financial statements. Careful: even one transaction or a bank fee may count as activity.
When can I pay a dividend?
After the annual financial statements are adopted. The 5% withholding tax is paid by the end of the month following the month in which the distribution was decided.
