Why use nominee services?
Many of our customers think that just by establishing a company or purchasing a new one, they will reduce their tax liabilities which they would otherwise have to pay in their own countries. The truth, however, is different. In order for a Bulgarian company to qualify as a resident for tax purposes in Bulgaria, it shall be managed by a Bulgarian resident. Otherwise, if a Bulgarian company is managed by a foreign resident, the place of business of said Bulgarian company shall be in the country where said foreign resident resides, and so the Bulgarian company shall become a resident for tax purposes in that other country. This is so due to the fact that the place of effective management is detrimental to where the company shall establish its place of business, and the place of business is the factor detrimental to where the company’s revenues shall be taxed. For example, if a French citizen establishes a company in Bulgaria in his/her name, but he/she is permanently residing in France, then the Bulgarian company shall establish a place of business in France, due to the fact that the company is being managed from France. As a result the company’s revenue shall be taxed pursuant to the Double Taxation Avoidance Agreement made between Bulgaria and France, and he/she shall pay French tax, in accordance with the Agreement made between Bulgaria and the respective country, because in this case France is only an example. This means that if you choose not use a nominee director, you will pay more taxes, and this is certainly not what you are looking for, right? Instead, if you use a Bulgarian resident as a nominee director, the place of effective management shall remain in Bulgaria and the company shall be a resident for tax purposes in Bulgaria. And this means that you will pay your corporate tax only in Bulgaria – the country with the lowest tax rates in the EU with only 10% corporate tax.
This is not something specific to the local legislation, but the way in which the international tax laws operate in the greater part of the world. Bulgaria has adopted and applies the OECD’s tax standards.
Another important nominee services component is the nominee shareholder. Using a nominee shareholder shall help you to save from dividend tax. In Bulgaria the dividend tax is only 5%. However, the international dividend taxation model which is also adopted in Bulgaria, stipulates that the income recipient is being taxed in the country where he/she is a resident for tax purposes. For example, if a shareholder in a Bulgarian company is a Spanish citizen residing in Spain, then the dividends shall be taxed pursuant to the Double Taxation Avoidance Agreement made between Bulgaria and Spain, and he/she shall pay Spanish tax, in accordance with the Agreement made between Bulgaria and the respective country, because in this case Spain is only an example. Using a nominee shareholder means that you will only pay the tax on the dividends in Bulgaria, which is only 5%.
Here are some other reasons due to which using a nominee director and shareholder would be beneficial:
- You do not wish your personal information to appears in the Commercial register;
- You do not wish to have as director and shareholder related parties who could easily be tracked, such as spouse, children, parents, or other relatives;
- You want to protect your property and assets against claims, divorce settlement, or use the company for inheritance purposes;
- Upon acquiring companies, you could easily hide the beneficial owner of the acquiring company.
What we can offer you?
We are currently offering the nominee director and nominee services only as a package. We cannot offer only nominee director or only nominee shareholder. The nominee director shall be a local natural person, and the nominee shareholder shall be a local company. According to our current rules, we can accept only one natural person as a company’s beneficial owner, who shall be approved by us in advance. For the purposes of the measures against money laundering, it is mandatory for the companies with nominees the accounting services to be provided by accountants selected and approved by us, and the price of the accounting services is paid in addition to the price of the nominee services, in accordance with our standard tariff. Our services are very secure for the customers of the nominee services, due to the properly made and very secure legal agreement between us and our customers and the high level of internal control and monitoring. In addition, we apply the best practices with regard to the due diligence and we offer vast knowledge in the field of the local legislation and the European regulations, which makes us a valuable advisor in performing your day-to-day business operations.
- Nominee director (per year) – 1300 EUR
- Nominee shareholder (per year) – 1500 EUR
- Signing of a document by nominee position holder – 30 EUR per hour for administrative services.
- Additional work for Nominee director or shareholders 80 EUR per hour.