Bulgaria vs Romania company taxes in 2026: what you actually pay

What, exactly, do I pay with a Bulgarian company?

Three numbers, that's all you need to remember:

• 10% corporate profit tax — one of the lowest rates in the entire European Union, and it's flat: it doesn't rise as you earn more.
• 5% on dividends — that is, on the money you take out of the company, for yourself.
• 20% VAT, with a registration threshold of around €51,000 in turnover.

Added up, out of a profit you want to take home as a dividend, the Bulgarian state takes about 14.5% — 10% on profit, then 5% on what's left. The rest is yours.

And how much less is that than in Romania?

The simplest way is to put them side by side, on the numbers in force right now, in 2026:

On profit and dividends, Bulgaria wins by a mile. On VAT, things have shifted: after the August 2025 increase, Romania went up to 21%, so it's now actually above Bulgaria (20%). So yes — on consumption too, Bulgaria ended up marginally gentler. But the part that truly matters remains profit and dividends.

What changed in Romania in 2026, that everyone's asking about now?

Exactly the things that made entrepreneurs look across the Danube. From 1 January 2026:

• Dividends rose from 10% to 16%. That is, on the money you take out of the company, you pay over half as much again as last year.
• The micro-enterprise regime tightened: the 3% rate disappeared (only 1% remains), but the ceiling dropped to €100,000 — go over it and you land straight on the 16% profit tax.

In short: more and more companies are leaving the "micro" zone and ending up at 16% on profit plus 16% on dividends. And then the comparison with Bulgaria is no longer theory — it's money.

Fine, but concretely — how much stays in my pocket?

Let's use a round example: a profit of €100,000 that you want to take out entirely for yourself.

• In Bulgaria: 10% on profit = €10,000. €90,000 remains, of which 5% dividend = €4,500. Total tax: ~€14,500. You keep ~€85,500.
• In Romania (company on the profit-tax regime): 16% = €16,000. €84,000 remains, of which 16% dividend = €13,440, plus health contribution CASS (capped, ~€1,950). Total tax: ~€31,400. You keep ~€68,600.

The difference: nearly €17,000 a year for every €100,000 of profit you take out — and that's before even counting the administrative hassle. Year after year, it adds up.

An important nuance, so I don't mislead you: the calculation above shows the tax in Bulgaria. If you remain a Romanian tax resident (i.e. your life stays here), the dividend taken from the Bulgarian company is discussed once more in Romania too — because, as a resident, you declare worldwide income. This is where the Romania–Bulgaria treaty (art. 10) comes in, capping withholding tax in Bulgaria at 5%, and through the tax-credit mechanism that 5% is deducted from the Romanian tax — in practice, you top up the difference to the Romanian rate (16% in 2026), without being taxed twice on the same money. So Bulgaria's biggest tax advantage lies in the 10% profit tax; on the dividend side, for a Romanian resident, the gain shrinks — which is why the final, end-to-end number is one we calculate on your situation, not on a general example.

And CASS — the health contribution on dividends?

This is something Romania has and Bulgaria simply doesn't. In Romania, on top of dividend tax, the state also asks you for a health contribution (CASS) on dividends taken out — an extra layer, above the tax. In Bulgaria there's nothing of the sort: the dividend is taxed once, at 5%, and that's it. No "health contribution" on top, no extra calculation.

In Romania, CASS on dividends is 10% and capped (not on all the money — it stops at a maximum). But the amount itself isn't the point — the point is that there's a whole extra mechanism, with returns and thresholds, that you don't even encounter in Bulgaria. It's exactly the kind of bureaucratic "small change" that, added up, makes the difference between two systems.

One thing, to be fully fair: CASS depends on your residency, not on where the company is. As long as you're a Romanian tax resident, you owe it on dividends anyway — another reason why "what actually stays in your pocket" is calculated on your concrete situation, not on a general rule.

But Romania's 1% micro-enterprise? Isn't that better?

Good question, and the answer is: it depends. Romania's 1% applies to turnover, not profit — and those are very different things. If you have thin margins, 1% of everything you collect can cost you more than 10% of a slim profit. Plus micro has two brakes: the €100,000 ceiling (over it, you move to 16%) and the fact that, either way, when you take the money out you still pay 16% on dividends.

So for a small company, under the ceiling, with thin margins, Romania's micro can genuinely be competitive. For one with good profit or over €100,000, Bulgaria clearly comes out ahead. There's no "always better" — it depends on your numbers. (Which is why, honestly, a calculation on your exact situation says more than any article.)

And Estonia? I've heard it's the best for tax.

It's the myth everyone runs into: "Estonia is modern, progressive, that's where it's best". The reality is less spectacular. Estonia does have one good trick — it doesn't tax profit as long as you keep it in the company and reinvest it. But the moment you take the money out for yourself, the tax goes up — and from 2026 the rate rose to 24%. Bulgaria, at 10% plus 5%, leaves you around 14.5%.

So: if you reinvest everything, always, Estonia can make sense. If you want to take your dividends and live off them, Bulgaria is more efficient. Estonia wins on image; Bulgaria wins on numbers, for the person who actually takes the profit out.