Rent between a company and an individual - taxes

Rent between a company and an individual - taxes

 

Question:
Hello!

I have a VAT registered company and I want to rent a shop. I want to ask how it is better:

- the owner to give it to me as an individual for BGN 1,000 (as he claims that only the first 9 months of the year, I will withhold 10% to pay rent tax, and the other 3 not, because it was so by law)

or

- as EOOD for BGN 1,200.

Thanks in advance!

 

Answer:

Hello,

Your Company, as a payer of income to an individual (in your case you pay rent to an individual), has the obligation to withhold 10% of the due income and to declare it and pay it into the state budget. This obligation is yours for the period January-September each year. For the period October-December, this obligation of yours is waived, but you can still agree to do it.

For example, if the rent agreed between you is BGN 1000.00, then for the period from January to September, you must pay BGN 910.00 rent to the individual, and the difference of BGN 90.00 you will have to declare and pay to the NRA. For the period October-December, you agree with the landlord whether to continue in this way or not to withhold this BGN 90.00 and pay him the full amount of BGN 1000.00, as the obligation to declare and pay tax for this period remains his.

We hope we have been helpful to you.

Greetings!