Thinking about building a team in Bulgaria? A Bulgarian Employer of Record (EOR) can make it simple, cost-effective, and fully compliant. With the right EOR partner, you can hire top talent without setting up a local entity and save time, money, and legal headaches along the way.

In this guide, we’ll break down how a Bulgaria EOR works, what you can expect from the process, and how your company can benefit from using one to power your expansion.

What is a Bulgaria Employer of Record?

An Employer of Record (EOR) in Bulgaria acts as the official employer for your workforce, managing employment-related tasks while you retain control over daily operations and employee performance. The EOR handles onboarding, payroll in Euros (EUR), tax compliance, and benefits administration, allowing businesses to expand into Bulgaria without establishing a local entity.

Why Partner with an EOR in Bulgaria?

  • Effortless Compliance: Bulgaria’s labor laws and tax regulations can be complex—an EOR ensures full legal adherence, minimizing risks and liabilities.
  • Payroll in BGN: Streamline payroll processing and ensure employees receive timely, accurate payments in the local currency, including tax withholdings and social contributions.
  • Rapid Market Access: Quickly establish a workforce in Bulgaria without the delays and costs of entity formation.
  • Cost-Effective Growth: Reduce operational costs by leveraging an EOR’s established infrastructure and local expertise.
  • Administrative Relief: Free your internal resources by letting the EOR manage employment contracts, benefits, and termination processes.

An EOR in Bulgaria enables businesses to scale efficiently, ensuring smooth workforce management and full compliance with local employment regulations.

Hire in Bulgaria

EU membership with some of the continent’s most competitive employment costs, plus NOI/NHIF contributions and Bulgarian Labor Code compliance.

We handle employment contracts, payroll, social contributions, and full Bulgarian compliance.

No local entity needed. Your team can start in days.

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As of January 1, 2026, Bulgaria adopted the euro (EUR), replacing the Bulgarian Lev (BGN) at the fixed conversion rate of 1 EUR = 1.95583 BGN. This means all salary figures, statutory contributions, and tax payments are now denominated in EUR, and employment contracts should reference EUR amounts. Existing BGN-denominated contracts were automatically converted at the fixed rate, which also removes day-to-day currency conversion friction for payroll and cross-border payments.

Key implications for employers include reduced FX exposure for EU-based companies, simpler eurozone payments, and more predictable employment cost forecasting, which strengthens Bulgaria’s appeal as a cost-effective hiring destination within the EU.

How Does a Bulgaria Employer of Record Service Work?

A popular method of incorporating a business in Bulgaria without setting up a legal entity is by using an EOR partner. An EOR  provide in Bulgaria will act as a legal employer and will be responsible for hiring local talent, managing the company’s payroll and ensuring compliance with local and national labor and taxation laws.

When using an Employer of Record (EOR), companies typically do not need to maintain in-country facilities, since the EOR employs workers locally and handles the required employment administration. This can remove the need to lease office space purely for compliance or operational presence, and it can also reduce reliance on ongoing local legal support because the EOR manages employment contracts, payroll administration, and day-to-day compliance requirements.

If you want to include an office cost example, a safer way to frame it is: average office rent in Sofia is often cited around EUR 10 to 15 per sqm per month, which would put a typical 50-sqm office at roughly EUR 500 to 750 per month. With an EOR model, this cost can often be avoided entirely because no local office is required.

Bulgaria EOR vs Bulgaria Entity

Under the Bulgaria EOR model, the EOR company usually handles several key duties:

  • Drafting and finalizing employment contracts in accordance with the Bulgarian Labor Code
  • Managing payroll in Euros (EUR), including withholding personal income tax and any other necessary deductions for the National Revenue Agency (NRA)
  • Registering employees with the National Social Security Institute (NSSI) and overseeing pension and health insurance contributions
  • Administering required benefits such as paid leave, sick leave, and any relevant allowances
  • Additional HR support, such as visa guidance and Bulgaria recruitment.

Since Bulgaria’s labor regulations can change, the EOR keeps current on updates to laws and procedures, ensuring that clients remain fully compliant. This involves monitoring any changes in social security requirements, minimum wage adjustments, and work-related documentation.

By managing these factors, the EOR reduces the risk of penalties or legal entanglements that might otherwise challenge foreign businesses.

Is an Employer of Record in Bulgaria Legal?

Yes, using an Employer of Record (EOR) in Bulgaria is completely legal, and it’s a growing strategy for companies that want to expand without the cost and complexity of opening a local entity. Under Bulgarian labor laws, as well as broader European Union (EU) regulations, businesses can legally partner with an EOR to manage employment contracts, payroll, benefits, and compliance on their behalf.

The key is ensuring that the EOR provider strictly follows all national and EU labor standards, tax regulations, and data protection rules (such as GDPR). A compliant EOR acts as the official employer of record for your employees, while you retain full control over their daily work and performance. This setup gives businesses a legally sound, low-risk way to hire top talent in Bulgaria while avoiding unnecessary bureaucracy or legal pitfalls.

How Much Does a Bulgaria Employer of Record Cost?

The cost of an EOR service in Bulgaria depends on multiple factors, including the size of the company, where the company is operating, and the complexity of the service provided.

Most EORs will charge a monthly fee and a one-time onboarding fee. Monthly fees can range from €450 to €2300 per employee, whilst a set-up fee can range from €500 to €2000. The set-up fee covers administrative costs, including onboarding employees, setting up payroll, and registering employees with the relevant tax authorities.

Additional charges pertaining to tax reporting and benefits administration may also apply, depending on the service.

How Does a Bulgaria Employer of Record Help with Payroll and Taxes?

A Bulgarian Employer of Record (EOR) takes the complexity out of managing payroll and taxes, giving businesses peace of mind when hiring locally. With deep knowledge of Bulgarian tax laws, social security requirements, and labor regulations, the EOR ensures that every payroll run is accurate, timely, and fully compliant.

They handle everything from calculating employee salaries and withholding the correct income taxes to submitting monthly social security and health insurance contributions to the Bulgarian National Revenue Agency. The EOR also manages end-of-year tax filings, employee payslips, and any required government reporting.

By taking full responsibility for payroll administration and tax compliance, a Bulgaria EOR helps businesses avoid costly fines, administrative errors, and compliance risks, freeing you up to focus on growing your team and operations instead of getting caught up in paperwork.

How Does Bulgaria Employer of Record Help with Benefits Administration?

Mandatory benefits in Bulgaria include annual leave, sick leave, maternity leave, and workers’ compensation in the event of a workplace injury or occupational illness. EORs will ensure that all mandatory benefits are administered when appropriate.

The EOR will also help companies craft attractive supplementary benefits packages, affording companies a vital advantage when sourcing and hiring talent.

What Labor Laws Apply to Hiring in Bulgaria?

Employer obligations and labor relations in Bulgaria are governed by two main legal frameworks: the Bulgarian Labor Code and EU laws and directives. These statutes protect workers in Bulgaria from exploitation and discrimination.

Employment Contracts

Employers are required to notify a territorial directorate of the National Revenue Agency upon the conclusion of an employment contract. Both parties must sign the contract, and a copy of the essential elements of the contract must be given to the employee prior to the commencement of employment. 

The two most common forms of employment contract in Bulgaria include fixed-term and indefinite contracts. The former contract type has a set end-date which may not exceed a duration of three years. Conversely, indefinite contracts do not provide an end date, affording the employee continuous employment.

All employment contracts must detail the name and address of both parties, salary, statutory benefits, supplementary benefits (if applicable), termination provisions, and probation conditions (if any).

Working Hours and Paid Holidays

The standard working week in Bulgaria is 40 hours, typically divided into eight hours per day over a five-day working week. If an employee works additional hours, they will be entitled to compensation at a rate of 50% for overtime on work days, 75% for holiday work, and 100% for work on public holidays.

Bulgaria observes 15 official public holidays:


  • New Year’s Day (Jan 1)

  • Liberation Day (Mar 3)

  • Good Friday (Orthodox)

  • Easter Saturday (Orthodox)

  • Easter Sunday (Orthodox)

  • Easter Monday (Orthodox)

  • Labour Day (May 1)

  • St. George’s Day / Army Day (May 6)

  • Culture and Literacy Day (May 24)

  • Unification Day (Sep 6)

  • Independence Day (Sep 22)

  • National Revival Leaders’ Day (Nov 1)

  • Christmas Eve (Dec 24)

  • Christmas Day (Dec 25)

  • Second Christmas Day (Dec 26)



Bulgaria follows the Orthodox calendar for Easter, which often differs from Western Easter dates. If a public holiday falls on a Saturday or Sunday, the following Monday is a rest day.

Social Security Contributions (PRSI)

Bulgaria’s mandatory social security system funds benefits such as pensions, health coverage, and other statutory insurance. Contributions are split between the employer and employee and are paid on insurable income up to the monthly maximum.

The employer’s total rate varies depending on the Accident at Work and Occupational Illness Fund rate, which is employer-only and ranges from 0.4% to 1.1%.

For employees born after 1959, the Supplementary Mandatory Pension (second pillar) applies at a combined 5% (2.8% employer and 2.2% employee), and this is already included in the rates shown below. All employee contributions must be withheld through payroll and remitted to the National Revenue Agency.

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Contributions are capped at the maximum insurable income of EUR 2,113 per month, meaning any earnings above this threshold are not subject to additional mandatory social security or health insurance contributions.

Overtime

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Probation Periods

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Union Membership

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Payroll and Employment Taxes in Bulgaria

Average Salary

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Employer Tax Contributions

Bulgaria offers one of the most cost-effective employment environments in the EU because employer payroll costs remain relatively predictable. Employers generally pay 18.92% to 19.62% on top of gross salary, made up of social security at 14.12% to 14.82% and health insurance at 4.80% (with the employer rate varying by the Accident at Work and Occupational Illness Fund rate).

Employer Cost ComponentTypical Rate
Base salary100%
Employer social security (DOO)14.12% to 14.82%
Employer health insurance (ZO)4.80%
Total employer contributions18.92% to 19.62%

For example, an employee earning EUR 2,000 per month typically costs the employer approximately EUR 2,380 to EUR 2,390 per month in total, before any supplementary benefits.

On the employee side, Bulgaria’s flat 10% income tax supports a strong take-home profile, and employees often retain around 76% of gross salary, contributing to one of the stronger net-to-gross ratios in the EU, especially when paired with Bulgaria’s relatively low cost of living.

Individual Income Tax Contributions

Bulgaria is known for having one of the most competitive tax setups in the EU, largely because it relies on flat rates rather than steep progressive brackets. For employers, this makes budgeting more predictable. For employees, it makes net pay easier to estimate and often more attractive compared to higher-tax European markets.

On the individual side, employment income is generally taxed at a flat 10%, which is among the lowest personal income tax rates in the EU. This is a strong talent draw because employees tend to keep a larger share of their gross salary compared to progressive-tax countries like Germany or France, where top marginal rates can reach around 45%.

There are no separate local or municipal income taxes, which keeps the overall tax structure relatively straightforward.

Other Taxes

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Time Off and Leave in Bulgaria

Mandatory Leave Entitlements

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Maternity Leave

Bulgaria’s maternity leave is one of the longest in Europe and is structured as a single entitlement that starts before birth and continues after delivery. The maternity cash benefit is not paid by the employer. It is funded through the social insurance system and paid by the National Social Security Institute (NSSI) at 90% of the employee’s average daily gross wage, provided the employee meets the eligibility requirement of at least 12 months of social insurance contributions.

From an employer perspective, the focus is on correct administration and job protection. While the NSSI pays the benefit based on insured income, the employer must manage the leave process properly and keep the employee’s position available for their return.

Maternity Leave ItemRule in Bulgaria
Total maternity leave410 calendar days
Pre-birth leaveMinimum 45 days before the expected due date
Post-birth leaveRemaining days taken after delivery
Leave after the 410 daysAdditional leave until the child turns 2, compensated at the statutory amount (approximately EUR 399/month in 2026)
Transfer of leaveAfter the child is 6 months old, the mother can transfer the remaining leave to the father

Paternity Leave

Bulgaria’s paternity leave rules include an immediate post-birth entitlement plus an additional longer leave option that can be used later in the child’s early years. As with maternity leave, the cash benefits are paid by the National Social Security Institute (NSSI), not the employer, and eligibility for both components generally requires at least 12 months of social insurance contributions.

The initial paternity leave is 15 calendar days immediately after birth, compensated at 90% of the father’s average daily gross wage and paid by the NSSI. There is also an additional 2 months of leave that can be taken any time before the child turns 8, paid by the NSSI at the statutory minimum daily wage. Separately, fathers may also take over the remaining maternity leave after the child reaches 6 months, with the mother’s consent, and receive the maternity benefit rate for that period.

Paternity Leave ItemRule in Bulgaria
Initial paternity leave15 calendar days, taken immediately after birth
Additional paternity leave2 months, to be taken before the child turns 8
Taking over maternity leaveFather may take remaining maternity leave after the child is 6 months old (with mother’s consent)

For employers, the core requirement is job protection and correct leave administration. The employer does not pay the paternity benefit directly, but must process the leave properly and maintain the employee’s position for their return.

Sick Leave

Sick leave in Bulgaria is split between the employer and the National Social Security Institute (NSSI). For most absences, the employer covers only the first three days, after which the NSSI takes over. To qualify for sick pay, employees generally need at least 6 months of social insurance contributions, and a medical certificate is required from day 1.

Sick Leave PeriodWho PaysBenefit Amount
Days 1 to 3Employer70% of average daily gross wage
Day 4 onwardsNSSI80% of average daily gross wage (90% for work-related illness or injury)
Maximum durationUp to 18 months of continuous sick leave

This structure keeps employer sick leave costs relatively contained, since the employer’s liability is limited to 3 days at 70% for most cases. For more details from the official authority, see NSSI sick leave benefits.

Work Permits and Visas in Bulgaria

Worker Type / PermitRequirementProcessing TimeKey Notes
EU/EEA nationalsNo work permit requiredN/ARegister with local authorities
Non-EU nationals (Single Permit)Work permit required2 to 4 weeksIssued by the Employment Agency; employer must demonstrate a labour market test (no suitable Bulgarian or EU candidate available)
EU Blue CardAvailable for highly qualified non-EU workersN/ARequires a salary of at least 1.5x the average gross salary

Since January 2026, Bulgaria is now part of the Schengen area, further simplifying travel and mobility.

An EOR can sponsor work permits for non-EU nationals and manage the entire application process.

Workers’ Compensation (Part of the Social Security System) in Bulgaria

Employers are required to make a mandatory contribution to the Occupational Accident and Disease Fund. This fund provides financial compensation for employees who contract a work-related illness.

In the event that an employee is permanently unable to work due to a workplace injury or illness, the employee will receive compensation for the amount they would have received had they been healthy. If an employee dies due to an accident or illness at work, their survivors are entitled to compensation.

Terminations and Severance in Bulgaria

Employment Termination

Both the employer and employee may agree to terminate the employment contract at any time, provided both parties mutually consent to the termination. If only the employer chooses to terminate the contract, they must give a justification and provide the statutory notice period.

In Bulgaria, the standard notice period is 30 days, though this may increase depending on the employee’s length of service. An employer can choose to terminate the contract without notice in the case of serious misconduct or poor performance.

Contracts that are forcefully terminated may be appealed by the employee. If an employee’s appeal is successful in a tribunal, the employee will be entitled to compensation.

Notice Period

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Severance Pay

Bulgaria’s labor code includes mandatory social security, health insurance, and EU-aligned worker protections. A Bulgarian EOR ensures full compliance. No local entity needed.

Engage an Employer of Record in Bulgaria with Remote People

Hiring in Bulgaria opens the door to a highly skilled, cost-effective workforce, especially in industries like tech, software development, and engineering. But navigating local labor laws, tax rules, and compliance requirements can slow you down. That’s where a Bulgaria Employer of Record (EOR) solution comes in.

By partnering with a trusted EOR like Remote People, you can fast-track your expansion, hire top talent quickly, and stay fully compliant—without the cost and complexity of setting up a local entity. Whether you’re scaling a tech team or growing your regional footprint, our EOR services provide flexible, reliable support tailored to your business goals.

Frequently Asked Questions

One advantage of using an EOR  is that it allows companies to expand into Bulgaria without needing to set up a legal entity. By saving the company costs relating to office space and facilities, an EOR can often prove more cost-effective.

A potential drawback of using an EOR relates to a lack of control over external processes. As the EOR will conduct their operations separately from the company, employers may be concerned about the safety of their data in the hands of employees they themselves have not vetted.

It is, therefore, vital that the provider is clear and transparent about the nature of their service.

In order to use an EOR in Bulgaria, companies must first choose a provider. Remote People offers a comparison tool where businesses can easily compare and evaluate providers based on their price, arrangement and flexibility.

Most providers can be contacted by phone or email or through a portal on the company’s website. Once in contact with the provider, businesses will need to discuss and set up an arrangement that supports their long-term goals.

A PEO (Professional Employer Organization) in Bulgaria, unlike an EOR, requires companies to have an established legal entity in Bulgaria. As opposed to an EOR, who acts as a legal employer, a PEO will act as a co-employer, sharing the liability with the company.

Yes, absolutely. A Bulgaria EOR can fully support remote hiring, whether your employees work from home, co-working spaces, or multiple cities across the country. They’ll handle employment contracts, payroll, taxes, and benefits for remote workers, keeping everything compliant with Bulgarian labor laws, no matter where your team is based.

It can be both. Many companies use a Bulgaria EOR for short-term projects, quick market entry, or pilot teams. But plenty also stick with an EOR long-term because it keeps operations simple and flexible. If you eventually plan to open a local entity, an EOR can even help you transition when the time is right.

No. EU/EEA nationals generally do not need a work permit, but they may need to register with local authorities depending on their length of stay and residence status.