Incorporating a single-member limited liability company offers numerous advantages for conducting business. It is an optimal choice for launching a small enterprise, particularly where the owner personally manages all company operations. The share capital may be owned by either a natural person or a legal entity.

The minimum capital required for registration is BGN 2.

Benefits of registering a single-member LLC

A single-member LLC is often used as an alternative to an employment relationship. High-earning professionals establish single-member companies and render their services through them to their employer, thereby reducing social-security contributions. If the owner opts to insure themselves as the sole shareholder instead of entering into a management agreement, they may benefit from lower social insurance contributions. Self-employed persons, unlike employees, are not insured for all social risks and may choose the minimum contributory base.

A single-member LLC also allows various business expenses to be deducted, reducing taxable profit and thus the tax burden. Profit is subject to 10% corporate income tax; surplus income may then be distributed as dividends taxed at 5%. No social contributions are payable on dividends.

Този модел е изгоден и за работодателите, тъй като няма да дължат осигуровки и ще спестят разходи за обезщетения за болнични, такси за служби по трудова медицина и други разходи.

Documents required for registration

When preparing the file, choose the company name and registered address, determine the business scope and appoint the managing director. It is advisable to check the Commercial Register for name availability to avoid refusal due to conflict with an already registered or reserved name.

Documents to be filed with the Commercial Register:

• Minutes of incorporation;
• Founding deed (articles for a sole-member company);
• A redacted copy of the founding deed with personal data removed (except as required by law);
• Notarised specimen signature of the managing director;
• Declaration by the managing director under Article 141(8) of the Commerce Act;
• Declaration by the managing director under Article 142 of the Commerce Act;
• Declaration attesting to the truthfulness of the stated circumstances and acceptance of the documents submitted for publication;
• Declaration under Article 13(5) of the Act on the Commercial Register and the Register of Non-Profit Legal Entities (where filed by an attorney-in-fact);
• Payment order or bank certificate evidencing the paid-in capital;
• Proof of payment of the state fee;
• Power of attorney (where filed by a lawyer);
• Application (Form A4)

Where the capital is owned by another legal entity, a resolution of that entity’s competent body approving participation in the formation is required.

The capital must be deposited into a dedicated subscription account with a bank.When paying in the capital, the originals of the minutes of incorporation and the founding deed must be presented.

The process is more complex where contributions in kind are made. In such cases, a prior valuation by three experts appointed by the Registry Agency is required. If real estate is contributed, the founding deed must be notarised.

The documents may be filed by a lawyer under a written power of attorney, which avoids notarial fees for authenticating the power of attorney and the A4 application and halves the state fee.

Registration fees

• The state fee is BGN 110 when filing in person at the Registry Agency’s counter.
• When filing electronically by a lawyer, the fee is BGN 55.

Time frame for registration

Entry in the Commercial Register is made on the next business day after filing. If documents are missing or inconsistencies are found, instructions will be issued and must be complied with within three days. Upon compliance, registration will be finalised.

If an irremediable defect exists, registration will be refused. Refusal may occur where an identical company name already exists or the stated activity requires prior authorisation.

For further information, advice or assistance, please contact us at
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