Bulgaria is preparing to join the ranks of countries implementing the Standard Audit File for Tax (SAF-T), a schema developed under the auspices of the OECD aimed at standardizing the way tax information is reported and exchanged. As an important initial step, the Bulgarian National Revenue Agency has made the first version of the SAF-T Bulgaria XSD schema available on their website for interested parties.
Understanding SAF-T’s Impact in Bulgaria
The European Commission’s support has been pivotal in Bulgaria’s decision to adopt SAF-T. Bulgarian authorities have conducted detailed reviews of existing implementations within the EU, such as in France, Poland, and Portugal, to incorporate best practices. These reviews have covered various aspects, including ledger formats, data scope, and technical transmission specifics. This approach ensures that Bulgaria adopts a well-rounded and efficient model for SAF-T implementation.
A notable goal of introducing SAF-T in Bulgaria is to streamline tax audits and lessen the compliance burden for taxpayers. The new SAF-T regime will be applicable to both resident and non-resident taxpayers possessing a Bulgarian VAT number. Initially, participation in SAF-T may be voluntary, facilitating a smoother transition for all involved. The reporting requirements will vary, with monthly obligations for sales invoices, purchase invoices, payments, and movement of goods, alongside the general ledger transactions. However, fixed assets reporting will occur annually, and goods movement will be reported as required.
Phased Introduction and Future Plans
The Bulgarian authorities have strategically planned the phased roll-out of SAF-T, with detailed formats and phases to be announced in 2024. This phased introduction is set to begin in 2025, aligning with the second version of the OECD’s XSD schema format. The schedule is as follows:
- First 6 months: Pilot testing phase.
- 12 – 24 months: Implementation becomes mandatory for large taxpayers.
- 36 months: Extension to medium taxpayers.
- 48 months: Incorporation of small taxpayers.
- 60 months: Full application to micro taxpayers.
SAF-T was launched over a decade ago with the intention of standardizing transaction-level data for VAT reporting. With many EU countries already onboard, Bulgaria’s move towards SAF-T represents a significant step in aligning with European tax reporting standards, demonstrating a commitment to modernization and efficiency in tax administration.
What This Means for Bulgarian Taxpayers
The impending introduction of SAF-T in Bulgaria signals a new era in tax compliance and reporting for businesses operating within the country. It’s a development that promises enhanced efficiency, transparency, and ease of compliance. Taxpayers, especially those operating across borders, should start preparing for this change, understanding the requirements, and how they apply to their operations.
By staying ahead of these developments, businesses can ensure a seamless transition to the new requirements, leveraging the benefits of standardized reporting and improved tax audit processes. As Bulgaria progresses towards the full implementation of SAF-T, all stakeholders are advised to stay informed and engage with the available resources to ensure compliance and optimal utilization of the new system.
