The inheritance tax

The inheritance tax is regulated in Chapter III of the Act on Local Taxes. Each heir (both by the power of intestacy or a beneficiary) is subject to an inheritance tax.

The inheritance tax includes the inheritance assets that have been acquired both in Bulgaria and in other countries by Bulgarian citizens, as well as the assets of foreigners who reside in Bulgaria but have inherited in another country. Legatees and third parties are also liable to the tax if they acquired assets or any kind of privileges related to the death of the testator. The testator’s spouses, children and ascendants remain tax-exempt.

The taxable persons must submit a tax declaration to the municipal authority within 6 months after the death of the testator. A declaration submitted by one heir at due date serves each co-heir as well. The taxable persons describe the acquired assets in their declaration by kind, location and estimated value. The procedure of estimating the value is described in Article 34 of the Act on Local Taxes. The tax burden is divided between the heirs according to the portions.

According to Article 36 of the act on local taxes and charges, the inheritance tax rates are fixed by a resolution of the municipal council for each group of heirs. The act prescribes the following rules:

• brothers, sisters and their children: from 0.4 to 0.8 % for a succession over BGN 250,000;
• for persons other than those under point 1: from 3.3 to 6.6 % for a succession over BGN 250,000.

The inheritance tax is determined for each heir individually and must be paid within 2 months after the notification.