Bulgaria Company Setup from Russia 2026: CFC and Sanctions

A Bulgarian EOOD costs EUR 1 of capital and pays 10% corporate tax, and Bulgarian company law has no rule against Russian owners or managers. What makes the Russian case different is that Bulgaria is in the EU: European sanctions apply directly to the company's bank account and its transfers, and the bank visit requires a Schengen visa.

On the Russian side, the controlled foreign company (CFC) rules, the filings and the limits on moving capital all apply. This guide puts both sides together.

€100kEU deposit ceiling per bank for Russian nationals and residents

40%Russian ownership above which an EU company reports large transfers out of the EU

10%Bulgarian tax rate, below the 18.75% Russian CFC floor

₽30mper foreign company without Bank of Russia permission, from 1 July 2026

Two readers, two files

Russian tax residence depends on 183 days in Russia within 12 consecutive months. Count your days first.

What Bulgaria asks of a Russian founder

• Nothing specific in company law: one owner, one manager, EUR 1 of capital.
• Documents by apostille: Russia and Bulgaria are both parties, so a Russian power of attorney needs an apostille and a certified Bulgarian translation.
• Sanctions screening: the lawyer and the bank check that no person involved is on an EU sanctions list.
• Excluded sectors: EU rules bar Russian nationals and residents from the governing bodies of critical infrastructure operators; an ordinary services or trading company is not affected.

The steps are in how to register a company in Bulgaria.

EU sanctions: two rules that touch an EOOD

• Article 5r has no exemption for residence permits or for dual EU and Russian nationals, according to advisers.
• Reports go to the Bulgarian authorities, and banks report on their side too.
• Bank policy goes further than the law: expect detailed questions on counterparties, goods and the source of funds. See the bank account guide.

1. 1
   Are you or anyone involved on an EU sanctions list?Then no Bulgarian company or account is possible
2. 2
   Do you hold EU, EEA or Swiss nationality or a residence permit there?Then the personal deposit ceiling does not apply
3. 3
   Is the EOOD more than 40% Russian-owned?Then report transfers out of the EU above EUR 100,000 per quarter
4. 4
   Is it in critical infrastructure?Russian nationals cannot sit on its governing bodies

Russian CFC rules at a 10% tax rate

A wholly owned EOOD is a controlled foreign company of its Russian resident owner. Two exemptions are usually discussed.

• The effective rate exemption does not work. Article 25.13-1 requires an effective rate of at least 75% of the weighted average Russian rate, 18.75% with profit tax at 25%. Bulgaria taxes at 10%. Whatever the status of the treaty, the rate is too low.
• The active company test can work. If passive income (dividends, interest, royalties, rents and similar) is no more than 20% of total income, the EOOD's profit is exempt.
• Below RUB 10 million of profit for the year, nothing is added to your Russian tax base.

Russian exemption floor18.75%

Bulgarian corporate tax10%

The Russian filings

The EOOD's own account belongs to the company and follows Bulgarian rules; only accounts in your name are notified in Russia.

The treaty and the dividend

Russia and Bulgaria have a tax treaty, but by Decree No. 585 of 8 August 2023, later confirmed by law, Russia suspended most of its articles for Bulgaria and other listed states. In practice:

• Bulgaria withholds its domestic 5% on dividends; it was not reduced by the treaty in any case.
• Russia taxes the dividend of a resident individual at its personal rates, 13% or 15%.
• The credit for the Bulgarian 5% depends on how the suspended treaty is applied to individuals; Russian legal press reports relief still applies. Confirm with an adviser.

See Bulgarian corporate tax.

Moving the capital out of Russia

• RUB 30 million per foreign company without individual Bank of Russia permission, from 1 July 2026, counting payments since 1 April 2024.
• EUR 1 of capital means the limit rarely matters at registration; it matters when you fund operations.
• The route is the hard part: few Russian banks still reach EU banks, and a Bulgarian bank will want to see where the money came from. Test with a small transfer.

Visa and residence

The EU fully suspended its visa facilitation agreement with Russia on 12 September 2025, and Bulgaria applies the general Schengen rules to Russian citizens. A short-stay Schengen visa is needed for the bank visit; living in Bulgaria needs a D visa and a residence permit, which also lifts the EU deposit ceiling. See non-resident founders.