Jurisdiction comparison · 2026
Germany is a great market - but a terrible holding jurisdiction. Bulgaria delivers the same EU passport at roughly a third of the effective tax burden, with setup measured in days.
| Bulgaria 🇧🇬 | Germany 🇩🇪 | |
|---|---|---|
| Corporate tax | 10% flat | ~30% (KSt + trade tax) |
| Dividend tax | 5% | 26.375% (KESt + Soli) |
| VAT rate | 20% (0% intra-EU B2B) | 19% |
| Min. share capital | BGN 2 (≈ €1) | €25,000 (GmbH) |
| Setup time | 3-7 business days | 4-8 weeks |
| EU membership | Yes (since 2007) | Yes (founding) |
| Social contributions | ~32% (capped at BGN 4,130/mo) | ~40% (split employer/employee) |
A German GmbH does not pay one simple 30% rate. It pays 15% corporation tax, the solidarity surcharge, and municipal trade tax whose multiplier depends on the municipality. That local Gewerbesteuer variable can materially change the result even before a founder takes a dividend. A Bulgarian EOOD instead applies one national 10% corporate rate with no municipal trade-tax layer. German founders also need to treat the move as a real operational decision: keeping management, a permanent home, or core decision-making in Germany can preserve German tax exposure even when the company is registered in Bulgaria. The strongest case is therefore a founder who genuinely relocates management and substance, not a German business that merely changes its registered address.
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