Bulgaria’s Ministry of Finance has opened a public consultation on a draft law introducing enhanced tax deductions for corporate donations to sports. The proposal sets deduction limits up to 35% of accounting profit and requires new reporting and monitoring by the Ministry of Youth and Sports.
Bulgaria’s Ministry of Finance (MoF) has launched a public consultation, on 2 April 2026, on a draft law amending the Corporate Income Tax Act (CITA) to enhance tax incentives for corporate donations supporting the sports sector.
The proposed amendments focus on expanding the tax deductibility of donations made to sports-related activities and institutions, while setting clear thresholds and compliance rules. Under the draft, a new provision in Article 31 will allow companies to recognise certain donation expenses for tax purposes, with the deductible amount linked to a percentage of accounting profit.
Donations to professional sports clubs for sports-technical activities will be deductible up to 10% of accounting profit, while support for the preparation and participation of Bulgarian national teams in international competitions will be allowed up to 20%. A higher threshold of up to 35% will apply to donations aimed at youth sport, “sports for all” initiatives, and the maintenance, repair, or construction of sports facilities in schools, universities, and academies.
The proposal also introduces safeguards to prevent abuse of the regime. Donations made between related parties will not qualify as tax-deductible expenses if the relationship exists at the time the donation is made. In addition, where donated funds are not used for the legally defined purpose, the unused or misapplied amount will be treated as taxable business income for the recipient in the same year the donation was received, creating a financial disincentive for misuse.
To support consistent application, the draft adds several key definitions to the law’s Additional Provisions. These include a clear definition of a professional sports club as a formally registered organisation employing professional athletes, participating in recognised competition calendars, and belonging to a licensed sports federation.
It also defines youth sport as organised sporting activity for individuals under 18, and sports-technical activity as the range of training and competition-related functions necessary to prepare athletes and teams.
In terms of implementation, the Ministry of Youth and Sports will be required to establish a reporting system for tracking donations, alongside mechanisms for oversight, sanctions, and control, by 31 December 2026.
If approved, the law will take effect on 1 January 2027.
The consultation will conclude on 2 May 2026.
