A Law on Amendment and Supplementation of the Tax and Social Security Procedure Code (TSSPC) was published in issue 63/04.08.2017 of the State Gazette. The country-by-country reporting (“CbCR”) legislation introduced by the Directive is implemented in Bulgaria through significant changes to the Tax and Social Security Procedure Code (“TSSPC”), as recently passed by the Parliament and published on August 4, 2017. In response to Action 13 of the BEPS Action Plan the Council of the European Union adopted Council Directive (EU) 2016/881 of May 25, 2016, which should have been implemented by Member States, including Bulgaria, by June 4, 2017 and applied from June 5, 2017.

The ultimate parent entity has the responsibility to submit the CbC report to the National Revenue Agency (NRA). The first such report shall be submitted for year 2016 by December 31, 2017. This report shall be filed electronically and the format is to be accepted by an order from NRA executive Director due to be issued by October 31, 2017.

The penalties are applicable for failure to fulfill CbC reporting obligations under the TSSPC. A penalty charge ranging from BGN 100,000 to BGN 200,000 (BGN 200,000 to BGN 300,000 if repeated violation) apply in case of a failure to submit a CbC report. For an incomplete or incorrect CbC report, the charges are from BGN 50,000 to 150 000 (BGN 100,000 to BGN 250,000 if repeated violation). Again, in case of failure to file the notifications described, the penalties from BGN 50,000 to BGN 150,000 (BGN 100,000 to BGN 200,000 if repeated violation) are applicable.