EooD allowed investments

Allowed. Used Etoro corporate with my EOOD in the past.

@huiswerk2

It's your EOOD and your (indirectly, for the purists) money, so you can spend it however you wish! :-)

And certainly companies everywhere use their funds to pay for both expenses and assets/productive investments, and then hold any surplus as fairly liquid assets (cash in bank, CDs, brokerage accounts, etc.). It's not so different from buying some gold, or purchasing your factory (instead of renting it).

However, while it is possible, I don't think it would be very convenient to buy physical gold (stored in your office, perhaps), and itemize it separately on your balance sheet. As @GB_2_BG says it's much easier to open a corporate brokerage account (e.g. Etoro, Saxo Bank, etc.) using your EOOD. And then show your brokerage balance on your balance sheet. Of course, in this case, you don't (usually) buy physical gold, but gold derivatives, or shares in gold-mining companies, etc.

Here's a little page from Etoro on Gold trading:

https://www.etoro.com/trading/how-to-buy-gold/

Tax-wise, I don't think there's likely to be a tax advantage doing it via your EOOD, rather than your personal name. Unless your EOOD is a low BG tax payer, and you are a high NL tax payer. But I'm not a tax expert by any means. If your gold holding is not a one-off, but part of using your EOOD for both trading and investment purposes, then perhaps you can treat yourself as an employee or trader and get a bunch of expenses (office, computers, phones, internet, pension, private health insurance) allowed. But increasing your expenses only helps if you have income to offset, and your investment gold is closer to a less-liquid form of cash, than to a productive income-generating asset.

I like companies, and they can be very useful. But they have a bureaucratic and cost overhead which I'd prefer to avoid, if possible. So if I found myself with a spare EOOD, and I didn't know what to do with it... I'd probably do nothing with it, and likely close it. If I had the EOOD because I'd purchase some Bulgarian real estate (unlike you, I'm non-EU), then I'd double-check the implications about changing my EOOD from an inactive one-asset company, into a more active multi-asset company. My guess is that the recommendation would be to keep an inactive EOOD for my home, and have a second EOOD for trading/business purposes.

I would not recommend buying CFDs from brokers with questionable regulatory oversight such as etoro (which is operating under a Cyprus license for EU clients). If they go bankrupt you will lose everything because buying CFDs means that you have counterparty risk with the broker. CFDs are different than buying exchange traded shares, futures or ETFs (which are hold in custody by the broker and which are kept under your name in case of broker bankruptcy).

Instead, you can buy collateralized exchange traded gold ETFs with normal brokers such as Saxo Bank, Interactive Brokers, Swissquote, Degiro etc. without counterparty risk. For instance, there's a collateralized gold ETF from UBS that you can exchange into physical gold anytime in their branches. You can also buy physical gold stored in audited collective or individual vaults with providers such as Degussa Goldhandel in Switzerland/Liechtenstein or get a gold backed credit card such as VeraCard. In any of these cases you get a statement for your accounting.

I went for Etoro as am a simpleton.

Went through verification for my BG EOOD on Interactive Brokers which was simples but I couldnt understand the platform.

Surprised how easy it is to register Bulgarian EOODs on Interactive Brokers

@euronamad

Hello "French expat in Bulgaria"

I am ( potential ) US expat in Bulgaria, trying to understand (and adjust) to EU/ Bulgaria's logistics.

May I ask ......what is the reason of "gold backed credit card" ?

Note : My understanding that credit cards are for spending (not for saving) , so I never worried if it's gold backed, or backed by fresh air ....

@bestlikefromme This is just a way of storing wealth in gold while having a way to liquidate it quickly in order to buy goods/services. Of course, you can store it as well in a vault and sell it when you need cash ;-)

@ Gwynj

Your advises are very reasonable ( as always ).

I would admit that this subject ( about EooD allowed investments ) is very interesting for me now,

because if I have  to register EooD  in order to register the car in Bulgaria ,

I think it can make sense to buy the house ( or two ) via EooD as well.

Can I buy a house (via EooD)  that will be registered for " mixed use "  ...meaning partially for personal use and partially as rental property ?

Can I rent my EooD property  to closest relatives (Note : I would prefer to rent my vacant property  to relatives (with minimal rent payments )  in order to keep visitors traffic  and utilities bills  under control and on the same time to keep company active ) ?

I understand that I well have to pay taxes for rental income at 10%.. I will be  ready for Tax day .

@euronamad

Frankly, I think that major reason for that "gold backed credit card" is to impress girls .

btw.  What is the gold limit - 5 gram or less ?   ( I will buy it as Christmas gift to my brother )

@bestlikefromme

I'm definitely not an expert on the use of EOODs, but my guess is that the recommendation would be to keep a separate, non-trading company to buy and hold properties. As it's not economically active (doesn't trade, doesn't have income) you can file some form of simplified accounts. This company is incorporated only to buy and hold a property with land (or several properties), in order to get round the non-EU restriction. I don't know exactly, but I think it's quite a small annual cost to keep everything up to date.

If you want some rental properties, then it would be a trading company as you would have income and expenses. Which would require more complex/expensive accounts.

But I think you're only considering giving it to "friends and family" so it doesn't sit empty, and you're concerned about the running costs of the house. In  the former case, I would suggest you just let them stay for free, or they give you a "gift", or nominal cash payment, and you try to avoid formalizing it all with a rental contract and large payments. In the latter case, you're probably influenced by your USA experiences, where utility bills and property taxes are rather high.

These "carrying costs" are completely different in Bulgaria. Property tax on a house can be very small (maybe 100 euros-200 euros per year, or even less). Utility bills here are still very affordable... and water and electricity are usually charged only by usage. We're currently in the city, so our house has been empty last couple of months. The internet went to 0 (he'll restart it when I pay for a month), the water is also 0, and the electricity is about 3 euros a month (I left the refrigerator on).

No, I do not try to avoid formalizing it all with a rental contract .....very opposite.....

I really very-very want to formalizing it all with a formally notarizing rental contract .....to make sure that my or my husband's relatives do not  try to stay in our home forever making us to pay for all their utility bills ...

What I try to figure out now , if Bulgaria rules allow to buy and register property as residential ( for personal use ) and " rental " at the same time....say, if we will buy 2-3 story building , can we live in the house by ourselves still formally rent out (with rental contract ) some part of the house/building to relatives ?

@bestlikefromme

I don't think such a distinction exists here! The property is classified by commercial (office, shop) or residential. If you own a house, you can live in yourself, or rent it out, or some combination. Perhaps there is some registration process for touristic properties (hotels, hostels, bed and breakfast), but this isn't what you have in mind.

Our village house is a very typical Bulgarian country house. I don't think the authorities care if we live in it full-time or part-time, leave it empty, or rent it out. If it's a huge, multi-floor house, and you live in one floor, and rent out 3 others, then I suppose the tax folks would like their 10%. But I'd be surprised if there is any bureaucracy for you to navigate in order to do this.

Thanks Gwynj,

I feel I can better  understand  the Bulgaria' rules when I compere its to USA rules.

The IRS USA tend ( with the help from Supreme Court ) to tax everyone and everything

and free-rent to relatives consider a " taxable gift. "

******below is United States Supreme Court’s decision about the subject matter ***I posted this info because I want to make expats to Bulgaria feel better about taxes in Bulgaria .

Quote : "The question is often asked about a client who allows a parent or sibling to occupy real estate owned by the client on a rent-free basis: Is there any gift tax consequence?

In general, the answer appears to be yes under the United States Supreme Court’s decision in Dickman v. Commissioner, 465 U.S. 330 (1984). the use of the property transferred.

In Dickman, the Supreme Court held that the foregone interest on an interest-free loan was a taxable gift. Despite the narrow set of facts in the case, the Court made several broad statements that suggest that the gift tax statutes apply to all situations in which one person allows another person to use property without compensation. "