We provide support to international companies to administrate their receivables and payments in Bulgaria
We offer payment administration services to (predominantly) international companies who are willing to consolidate their incoming payments in Bulgaria. By doing so, we eliminate the headache of chasing payment due dates, issuance of invoices (compliant with Bulgarian accountancy laws), controlling bank charges and other fees, etc.
Authorizing one of our, specially registered for the purpose companies, to act on your behalf and to receive payments from your international clientele has many advantages. Not only will you be relieved from the associated administration load, but most importantly, your company will have an additional layer of protection by utilizing our undisputed reputation with the banks in Bulgaria.
Apart from the administrative assistance and the workload we will take on us, what are the other special cases when our payment administration services are most sought after?
International company with sustainable business model, willing to establish presence in Bulgaria
The low tax rate in Bulgaria and the unexpected effects from it
When the Bulgarian parliament introduced the 10% flat rate in Bulgaria, the main idea behind this move was to (1) assist the Bulgarian business through low taxation and (2) to attract foreign investors who would relocate their businesses to Bulgaria in order to profit from the low tax rates.
The influx of foreign businesses in Bulgaria
Since then, thousands of foreign businesses have indeed relocated their financial centers to Bulgaria and have thereby utilized the advantages of the Bulgarian tax system. For many years, the system worked really well and it was a win-win game for both the foreign companies and the Bulgarian budget. The taxes paid by the international business, while quite low for them, were a nice bonus for the Bulgarian economy.
The tightened conditions
In recent years however, with the tightening of the international control on tax evasion, the financing of terrorism and the Anti Money Laundering (AML) regulations, the banks in Bulgaria were forced to introduce special measures and extremely comprehensive KYC (know your customer) standards.
The (un)expected reaction of the banks
This has led to a genuine desire of the banks to know in detail the business model of their international clients, a task that became just too much to handle. While Bulgarian businesses are more or less transparent to the local banks, as they have most of their business resources concentrated in the country (employees, clients, offices, etc.), a foreign business appears as a blank canvas, if seen from Bulgarian perspective. And amid the new AML, KYC and other regulations, this blank canvas meant for the banks nothing, but trouble. New businesses, involving BitCoin and other crypto currencies, have also poured oil on the fire. All that has made the Bulgarian banks extremely worried of the situation.
The massive closures
And the result was to be expected. Under threat of furious sanctions on national and EU level for not being able to meet the latest (unclear) AML/KYC regulations, THE BANKS IN BULGARIA STARTED CLOSING FOREIGN ACCOUNTS ON A MASSIVE SCALE. They have also started applying a POLICY OF ZERO NEW CLIENT ACCEPTANCE.
With our payment administration services, your business is protected from account closures!
Foreign small or mid-size company wishing to start business in Bulgaria
These companies are now in fact being deprived of the right to register a business in Bulgaria as they are simply not able to open a bank account (required for the registration). Their resources and lack of business history doesn’t allow them the chance to prove to the Bulgarian banks their genuine business intentions.
The solution for you
By employing us to handle your payment administration, you get:
- Flawless administration of your payments and invoices;
- Ultimate tax compliance (if combined with our accountancy services);
- Possibility to work with your Bulgarian company and enjoy the 10% tax rate even without a bank account in the country;
- Professional reporting and consolidation of debts.
Please contact us for a non binding consultation and an opportunity to enhance your business model.