Registration of a cleaning company

Registration of a cleaning company

Question:
Hello!
I am a natural person, everything is ready for me to open a cleaning company. I read on the internet that in order to become a freelancer, I need to have a specialty certificate or a diploma in a given profession. I don't have a diploma or certificate. Could you advise me what to do? Is EOOD the only option for cleaning services?
Thanks in advance!

Answer:
Hello,
The options are you or EOOD or ET (Ednolichen Tarovets). We will try to describe the main differences between the two options.
From a tax point of view, things look like this:
- with ET you declare the amount of income for the year. From the amount received in this way, you deduct the insurances paid during the year and on the amount received in this way, you owe 15% tax.
- with an EOOD, you declare the amount of income and expenses related to your activity. If the income is more than the expenses, then you make a profit and this profit is taxed at 10%.
 
From an insurance point of view, the situation is as follows:
- with ET, you are insured monthly, and accordingly you must declare and pay insurance every month, with the minimum insurance income currently being BGN 710.00, which means minimum insurance in the amount of BGN 200.00 per month. At the end of the year when the annual tax return is submitted, an adjustment is made. In this equalization, the realized profit during the year is looked at, and if the amount exceeds the amount on which you were insured, you must add insurance on the difference. The amount on which insurance is paid on an annual basis cannot be higher than BGN 40,800.00.
 
- with EOOD, the insurance contributions are again paid on the minimum insurance income for the year - BGN 710.00, the difference being that there is no annual equalization of the insurance contributions.
 
I.e. purely from a tax and insurance point of view, you will need to assess and make some kind of plan as to what income you expect to receive and what expenses you would have. Only in this way would you be able to determine which form of activity is economically more profitable (ie you would pay less tax and insurance).
 
Apart from the differences from a tax and insurance point of view, there are also several purely functional differences:
- the money you earn as an ET is really your money and you can "spend" it whenever and on whatever you want. With an EOOD, the money the company makes stays with the company. If you want, as the owner, to have this money available, there are several options - to give yourself a salary, to give yourself a loan, or after the financial year is over and the company, if it has made a profit, you will be able to distribute the profit as dividend (but you will have to pay an additional 5% dividend tax on this amount).
- as an EOOD, the company is responsible for its obligations to the extent of its own assets and capital. As an ET - you are the company, which means that you are personally responsible with all your property for any liabilities arising from your activity as an ET.
We hope we have been helpful!
Greetings!