International Health Insurance in Bulgaria: Tax & Accounting Considerations. Company Reg for 190 EUR

Quick summary: This video explains how international private health insurance interacts with Bulgarian NHIF rules, employer tax treatment, and accounting entries, and what expats, employers, and accountants must document to stay compliant.

Who this video helps: expats living in Bulgaria, remote workers, HR managers, accountants, company owners, and tax advisors.

International Health Insurance in Bulgaria: concise summary

Quick take: If you live or work in Bulgaria, whether private international health insurance is merely advisable or legally required depends on your insured status (NHIF categories under the Health Insurance Act), your residence/visa type, and whether you are covered by another EU system (S1/A1/EHIC). For companies, employer‑paid international policies can be treated either as a taxable benefit or a business expense depending on how the policy is structured and who the insured person is, Payroll – Accounting Services in Bulgaria

Key legal & tax points to know

• Who must join NHIF: Bulgarian NHIF is mandatory for people in the categories listed in Art. 33 of the Health Insurance Act (Bulgarian citizens, long‑term/permanent residents, holders of certain permits). Others (short‑stay residents, many non‑EU residents) typically must keep private insurance.
• EU coordination: If you have an S1 (pensioners/posted workers) or an A1 certificate showing another state’s social system applies, Bulgaria may not require NHIF contributions. EHIC covers medically necessary public care for temporary stays.
• Remote work and teleworkers: If you work remotely from Bulgaria for a foreign employer and you do not have an A1, Bulgarian rules often make Bulgaria the competent state for social insurance, which can trigger NHIF obligations.
• Employer‑paid international policies: When a Bulgarian company pays for an employee’s private international health insurance, the premium can be treated as a taxable fringe benefit for the employee unless structured as a business necessity for the company (e.g., required for business travel or expatriate assignment). Tax treatment depends on facts and documentation.

Insurance thresholds & insurance percentages in Bulgaria

From August 1, 2026, the minimum insurable income for self-employed persons will increase to EUR 620.20, matching the minimum monthly wage. The maximum insurable income will rise to EUR 2,300. The bill also provides for higher minimum insurable income thresholds in selected economic sectors.

The bill further provides that, from August 1, 2026, civil servants covered by the Civil Servants Act and employees under the Judiciary Act will begin paying personal social insurance contributions. Contributions will initially be shared between employer and employee at a ratio of 80:20, before changing to 60:40 from January 1, 2027.

Insurance Percentages: Pension: Employee 9.9%, Employer 12.8%.

Health Insurance: Employee 3.2%, Employer 4.8%.

Total National Insurance Contribution Rate: Approximately 32.7% of gross insurable income, split between employer and employee. These thresholds and percentages reflect the recent adjustments aimed at aligning contributions with real income levels across various professions.

Considerations for individuals & expats

Visa and residence applications: Many long‑stay visas require private insurance with minimum coverage (commonly €30,000 and repatriation for Type D student/visa). After residence is granted, NHIF obligations may follow.

Self‑employed and company owners: If you are self‑insured or a company owner, you must register with the NRA and pay NHIF contributions based on the statutory base unless covered by another system. Taking only dividends does not create NHIF contributions, but being a resident or manager with other statuses can.

Family coverage: NHIF is individual; family members generally need their own basis for coverage. Private international policies can cover families but check local recognition for residence/visa purposes.

Practical checklist & recommended next steps

Confirm your insured status under ZZO Art. 33 (resident type, work permit, posted worker, pensioner). If you have an S1 or A1, keep originals on file.

Decide policy ownership: Prefer company‑owned policies only when the cover is demonstrably for business needs or for posted employees; otherwise expect fringe‑benefit treatment.

Document business purpose: Keep written policy terms, board minutes or HR policy showing why the company pays the premium (assignment letter, travel policy, expatriate contract). This supports deductibility and payroll treatment.

Check payroll and social rules: If the insured is an employee or company manager, calculate employer/employee contributions and withholdings; consult payroll provider for correct reporting.

Confirm VAT and cross‑border rules with your tax advisor when insurer is non‑Bulgarian.

Accounting treatment for companies

• Expense recognition: Premiums paid by the company are normally recorded as insurance expense (operating expense) when they relate to business needs. If the policy is a benefit to an employee, the company should record the premium as payroll/employee benefit expense and consider payroll tax and social security consequences, Payroll – Accounting Services in Bulgaria
• Tax deductibility: Deductibility depends on whether the expense is ordinary and necessary for the business and properly documented. Employer contributions for employee benefits may be deductible subject to local tax rules and limits; personal benefits (e.g., for owners taking only dividends) require careful structuring.
• VAT: Health insurance premiums are typically financial services and often VAT‑exempt; check the policy wording and insurer location. Treat VAT carefully in cross‑border contracts.

Sample journal entries (illustrative), Payroll – Accounting Services in Bulgaria | Labour contracts registration.

• Company pays premium for business travel policy:
  • Debit Insurance Expense; Credit Bank.
• Company pays premium as employee benefit (taxable):
  • Debit Employee Benefits Expense; Credit Bank.
  • Record payroll tax withholding and employer social contributions as required. (Adjust accounts to your chart of accounts and local payroll tax codes.)

Core legal & tax signals to watch for

NHIF is mandatory for persons who fall into the statutory insured categories; non‑residents and many short‑stay visa holders commonly rely on private international policies instead. .

Employer‑paid private health insurance can be treated as a taxable fringe benefit if it is not provided under a company‑wide social benefits scheme; selective cover for some employees often triggers payroll tax or non‑deductible expense treatment. .

Corporate tax deductibility depends on whether the expense qualifies as a social/employee benefit available to all employees and whether it’s demonstrably business‑related; absent clear NRA guidance, companies often either treat premiums as non‑deductible or as taxable employee income.

Insurance premium tax and VAT rules matter for cross‑border policies; premiums may fall under financial services rules and specific premium tax legislation in Bulgaria. .

Personal tax reliefs and allowable deductions can apply to certain voluntary health and life insurance contributions within statutory limits; check current PITA guidance for caps and documentation, Taxes – Accounting Services in Bulgaria

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