Corporation Tax for Companies Over 5 yrs?

We don't like them but we gotta pay them! How does it work in Bulgaria?

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thewig
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Postby thewig » Tue Sep 20, 2011 1:05 pm

Anybody know anything about 10% Corporation Tax being payable once the Company is 5 years old?
Hearing a few rumors but nothing that makes any sense to me, so can anyone throw any light on this?

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kazz
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Postby kazz » Tue Sep 20, 2011 2:20 pm

Nothing that makes any sense to me either....we've had our company for more than 5 years, it's been active for, well, nearly 5 as it happens so if there is anything I guess I could be in for a surprise sometime soon.
BUT 10% of WHAT?
If the company makes a profit at any stage it's liable for tax, if it doesn't than how is the 10% calculated?

More info please?

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thewig
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Postby thewig » Tue Sep 20, 2011 2:38 pm


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kazz
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Postby kazz » Tue Sep 20, 2011 3:02 pm

Hmm.....So are they saying that after 5 years the 'debt' that the company owes to the owner of the company (or whoever provided the capital for the purchase of the property) magically becomes a company asset?
Unless the necessary paperwork is filled in to prevent this from happening?


I will talk to the accountant about this. Looks to me like a lawyer looking for business but who knows?!

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vt
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Postby vt » Tue Sep 20, 2011 3:16 pm

Oh no!
Just when I thought that I had my house in order.

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kazz
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Postby kazz » Tue Sep 20, 2011 3:27 pm

Knowing your accountant I'd be pretty confident you do have your house in order:)
Even if there is something that's supposed to be done it's likely that a competent accountant will have done it and they don't always bore us with the details.

BG9374

Postby BG9374 » Tue Sep 20, 2011 5:31 pm

Got me, so you invest funds in your company via an asset, since most people never put the funds through their company bank account, and if is no loan note written its then seen as taxable income?

Read that link correct?

If you spend funds on your asset, the house, those funds then taken to have been spent through the company and hence income of be pure profit?

So if you lend the business funds, how could that be taxable, its a loan. If your business places the responsibility of fees, repairs, rebuilding or building [remember its the land we cannot own at this moment] then how is that non profit taxable.

What a person could do is debt the company for works, directors fees etc and that could wipe out eventual the cost of ownership of the house.

Appreciate all of the above makes work for professionals. Only my understanding from what is written if that link be factual? Anyone.

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kazz
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Postby kazz » Wed Sep 21, 2011 12:41 pm

Have spoken to the accountant and her first reaction is that 'it all depends on it's shown on the balance sheets.'
She now has the link for the Bulgarian version of this page and will comment on it when she sees exactly what they've written in Bulgarian.

I doubt that this will happen until after the holidays but when I get anything from her I will post it up here.

BG9374

Postby BG9374 » Wed Sep 21, 2011 1:05 pm

Very good point that is seen. Since many of us and I include myself never put the funds through the company bank account, in-fact I don't have a company bank account.

The funds are a loan, and thus no requirement of a bank account - just requires a notary confirm funds given on loan. Again needs a professional.

That link appears valid, could come back to bite a few, as ever the law is there to make a buck, or in this case leva. If you give money away, its a gift and without paperwork that gift must be taxable "income", revenue service views that as profit. :)


All of this shall correct next month when I visit BG.

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thewig
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Postby thewig » Wed Sep 21, 2011 1:24 pm

From another Lawyer:-

this is an absolute nonsense. Just an advertisement trick so that you use the services of this "professional lawyer"
don't worry at all because from accountancy point of view this is treated as financing from the shareholdres and there are no limitations when the company should give back your money.


'


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