Bulgaria: Transfer pricing documentation; Local file for 2020 required by 30 June 2021

In general, all taxpayers have a general obligation to prove the arm’s length nature of their related-party transactions.

First year for which mandatory transfer pricing documentation must be prepared is 2020

The first year for which mandatory transfer pricing documentation must be prepared is 2020.

  • The deadline is 30 June 2021 for preparing a Local file regarding the transfer pricing documentation for 2020.
  • Entities that are part of a multinational group of companies and that are required to prepare a Local file must also prepare a Master file. The deadline is 30 June 2022 for preparing a Master file for 2020.

Taxpayers must prepare a Local file for 2020 if, as of 31 December 2019, they reported amounts exceeding at least two of the following three thresholds:

  • BGN 38 million (approximately €19 million) net book value of assets
  • BGN 76 million (approximately €39 million) net sales revenue
  • Average number of the personnel for the reporting period of 250

In general, all taxpayers (even if not exceeding the above thresholds) have a general obligation to prove the arm’s length nature of their related-party transactions, and this is accomplished by preparing transfer pricing documentation.

Other measures address the scope of controlled transactions required to be reported and documented in the Local file.

If an amended corporate income tax return is filed for 2020, and this amended return results in any changes to the information provided in the Local file, then the Local file must be updated within a 14 days after the submission of the amended return (but not later than 30 September 2021).

Read a May 2021 report [PDF 103 KB] prepared by the KPMG member firm in Bulgaria

 

 

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