House sale and tax?

It's rather complicated. There are a couple of different valuations you have to obtain and the tax implications can indeed be significant.

I'm going through this exercise right now and here's my current understanding of the situation, courtesy of my "AI buddy", so caveat emptor... My lawyer is currently checking out the realities of the process.

"When you transfer property from a company to yourself in Bulgaria via liquidation, there is no "sale" in the traditional sense, but the law assigns a value for tax purposes. This is where it gets slightly complex, as two different values are used for two different taxes.

​1. For Transfer Taxes & Notary Fees: Tax Valuation

​To legally register the property in your name, the municipality will use the Tax Valuation (danachna otsenka).

​This is an administrative value calculated by the local tax office based on the property’s size, location, and construction type. 

​It is almost always significantly lower than the market value (often 30% to 50% lower).

​The "Price": You can choose to transfer at this Tax Valuation to minimize the immediate municipal tax (usually 2.5% to 4%) and notary fees.

​

2. For the 5% Liquidation Tax: Market Value

​This is the part that often catches people by surprise. The National Revenue Agency (NRA) views the distribution of an asset to a shareholder as a "dividend in kind."

​The "Price": For the purpose of calculating your 5% liquidation tax, the "price" is the Market Value at the time of the transfer. 

​The Calculation: You are taxed 5% on the difference between the Market Value of the property and your original investment (the company’s share capital).

​Requirement: In 2026, the tax office typically requires a valuation report from a licensed appraiser to determine this market price.

Note: If the market value is much higher than the book value l, the company itself might technically owe 10% corporate tax on that "gain" before it can be dissolved.

Since you are an EU citizen and likely the sole owner, the most common route is to:

Obtain a Tax Valuation certificate from the local municipality.

Use a licensed appraiser to provide a market valuation (to satisfy the NRA). 

Transfer at the Tax Valuation on the Title Deed to keep registration costs low, while paying the 5% Liquidation Tax based on the market value.

Crucially: Once the transfer is done, your "Acquisition Price" for future personal Capital Gains Tax is the value stated on your new Title Deed. If you set that too low now, you might pay a much higher 10% tax if you sell it within the next 3 years."

@JimJ

You should write an article for the site's online magazine, Jim. They are always after writers.