India
Bulgaria
Bulgaria gives an Indian founder an EU company for EUR 1 of capital, with 10% corporate tax and no local partner. The Bulgarian side is fast. The Indian side decides whether the investment is allowed, what the bank collects before the money leaves, and where the profit is finally taxed.
One more point is specific to Bulgaria: it is in the Schengen area, so the trip to open the bank account needs a visa.
What Bulgaria asks of an Indian founder
- One owner and one manager, both of whom can be Indian residents.
- EUR 1 of capital, deposited in a Bulgarian bank before registration.
- A notarised, apostilled power of attorney for the Bulgarian lawyer who files; India and Bulgaria both apply the Apostille Convention.
- Certified Bulgarian translations of documents signed in India.
- A registered address in Bulgaria.
The steps are in how to register a company in Bulgaria. An individual can own the EOOD directly, which matters for the Indian rules below.
Three Indian starting points
| You are | Indian route | Fit with Bulgaria |
|---|---|---|
| An Indian company, LLP or registered firm | Overseas Direct Investment (ODI) | Good: an EOOD is a limited liability operating company |
| A resident individual | ODI through the Liberalised Remittance Scheme (LRS) | Good for an operating EOOD; not for a holding with a subsidiary |
| An Indian no longer resident in India | Outside the LRS limits | Your new country's rules apply |
Route one: an Indian company invests under ODI
- The investor is an Indian entity: a company, an LLP or a registered partnership firm, not a sole proprietor.
- The Bulgarian company has limited liability, which an EOOD does.
- The activity is a bona fide business, outside the prohibited list.
- Form FC is filed through your bank before the remittance, and an Annual Performance Report every year by 31 December.
The amount is capped by reference to net worth, widely stated as 400% of the last audited net worth.
3 questions
Which jurisdiction fits you?Answer three questions and get the three jurisdictions that match your situation.
Route two: a resident individual under the LRS
A resident individual may remit up to USD 250,000 per financial year, all purposes combined.
| India allows | India does not allow |
|---|---|
| Shares in an operating foreign company | A foreign company in financial services |
| Control of that operating company | Control of a foreign company that has a subsidiary |
| Investing alone or with other resident individuals | Remitting through a company, firm, HUF or trust |
| Up to USD 250,000 a year | Remitting without a PAN |
Keep the EOOD as the operating company. If you control it as an individual, it may not own a subsidiary.
- 1Do you run an Indian company, LLP or firm?Invest through it under ODI, Form FC through your bank
- 2Investing personally?Use the LRS, up to USD 250,000 a year, PAN required
- 3Will the EOOD own a subsidiary?As an individual in control, not allowed
- 4Is the activity financial services?Closed to individuals under the LRS
The tax collected before the money leaves India
| LRS remittances in a financial year | TCS |
|---|---|
| Up to ten lakh rupees in total | Nil |
| Above ten lakh, education or medical treatment | 2% |
| Above ten lakh, any other purpose, investment included | 20% |
TCS is a payment on account, credited in your Indian return. It does not apply to a company's ODI remittance. With EUR 1 of capital, TCS only bites on the money you actually send to fund the business.
The India and Bulgaria tax treaty
The treaty has been in force since 23 June 1995. Its ceilings are all above what Bulgaria withholds under its own law, so in practice the Bulgarian domestic rate applies.
| Income from Bulgaria to India | Treaty ceiling | Bulgarian domestic rate | What applies |
|---|---|---|---|
| Dividends | 15% | 5% | 5% |
| Interest | 15% | 10% | 10% |
| Royalties, copyright | 15% | 10% | 10% |
| Other royalties, technical services | 20% | 10% | 10% |
What the treaty does matter for is the credit in India: a dividend taxed at 5% in Bulgaria is taxed again in India at your rate, with a credit for the Bulgarian 5%. The 10% corporate tax paid by the EOOD is a company tax and is not credited to you personally. See Bulgarian corporate tax.
Where the company is really managed
India treats a foreign company as resident if its place of effective management is in India. An EOOD whose decisions are all taken in Pune can be argued to be Indian for tax.
- Take and minute decisions where the manager is.
- Give the EOOD real activity: contracts, invoices, a Bulgarian bank account and accountant.
- If you move to Bulgaria, your Indian residence changes the analysis; see tax for non-residents.
The Schengen visa and the bank
Bulgaria has been a full Schengen member since 1 January 2025. Indian citizens need a visa to enter.
- For a short visit, such as opening the bank account: a Schengen short-stay visa, applied for through the Bulgarian consulate or its visa centre in India.
- To live and run the EOOD in Bulgaria: a long-stay D visa as manager, then a residence permit; see non-resident founders.
- Plan the visa before the company, since the capital account is opened before registration; see the bank account guide.
The bottom line
Bulgaria suits an Indian founder who wants an EU operating company: one EOOD, owned directly, funded through ODI or the LRS. Bulgarian taxes are low and below the treaty ceilings; India taxes the dividend again with a credit. The practical bottleneck is the Schengen visa for the bank visit.
corpsec registers the EOOD and provides its registered address; your Indian bank and chartered accountant handle the ODI or LRS filings. See the Bulgaria formation service, or check the full first-year cost.
Frequently asked questions
Can an Indian citizen open a company in Bulgaria?
Yes. An EOOD can have a single Indian owner and manager, with EUR 1 of capital and no local partner, registered through a Bulgarian lawyer with an apostilled power of attorney.
Can an Indian resident individual invest in a Bulgarian company?
Yes, under the LRS, up to USD 250,000 per financial year, in an operating company. An individual may not control a foreign company that has a subsidiary.
Does India have a tax treaty with Bulgaria?
Yes, in force since 23 June 1995. It caps dividends and interest at 15% and royalties and technical fees at 15% or 20%, above Bulgaria's own 5% and 10% rates.
Is TCS charged on money sent to a Bulgarian company?
For individuals under the LRS, yes: nil up to ten lakh rupees in a financial year, then 20% for investment purposes, credited against your Indian tax.
Do Indians need a visa for Bulgaria?
Yes. Bulgaria is a full Schengen member since 2025, so Indian citizens need a Schengen visa for short visits and a D visa to live there.
Can I run the Bulgarian company from India?
You can, but if effective management is in India, India may treat the company as Indian resident. Keep decisions and activity with the company.
Sources
- Reserve Bank of India, Overseas Investment Directions 2022: Indian entities, Form FC through the bank, limits on resident individuals (operating entity only, no control of an entity with a subsidiary)
- Reserve Bank of India, Master Direction on the Liberalised Remittance Scheme: USD 250,000 per financial year for resident individuals, PAN mandatory
- Indian Ministry of Finance, memorandum to the Finance Bill 2026: section 394(1) of the Income-tax Act 2025, 20% TCS on LRS remittances above ten lakh rupees other than for education or medical treatment
- Convention between India and Bulgaria for the avoidance of double taxation, in force on 23 June 1995 and notified in India in May 1996: 15% on dividends and interest, 15% or 20% on royalties, 20% on fees for technical services
- Deloitte, Bulgaria Highlights 2026: Bulgarian withholding of 5% on dividends and 10% on interest, royalties and technical services paid to non-residents
Official Indian sources read for this series on 5 October 2026: the RBI Overseas Investment Directions 2022, the Master Direction on the LRS, and the Finance Bill memoranda for TCS. The India and Bulgaria treaty was read in a reproduction of its text on 26 October 2026; its figures agree with the Indian tax department's treaty tables. Some databases give the treaty a signing date of 1994 or 1996; we give only the entry into force, 23 June 1995, from the Indian notification. Bulgarian rules are those read for the other guides of this series on 26 October 2026. Secondary and to confirm with the Bulgarian embassy or VFS: visa procedures for Indian citizens. Not read: the Overseas Investment Rules themselves, so the corporate limit of 400% of net worth is reported as widely stated. This is not legal or tax advice.