The eighth issue of KPMG’s Tax News for 2017 summarizes the amendments introduced in the Personal Income Tax Act (PITA) through the Act to Amend and Supplement the VAT Act, promulgated in the State Gazette, issue 97 dated 5 December 2017. The changes become effective as of 1 January 2018.
Annual Personal Income Tax Return
Preliminary tax return filing deadline
The preliminary deadline for filing of the annual personal income tax return and utilizing a 5% discount is changed from 31 March to 31 January of the following year. 31 January will also be the deadline for payment of the tax due. In addition, the cap of the discount is reduced to BGN 500. These amendments will also be applicable with regard to the 2017 personal income tax returns.
The remaining requirements for benefiting from the discount remain valid: namely, that the return is filed electronically and that the tax liable person does not have outstanding liabilities subject to public enforcement as at the date of filing of the tax return.
Declaring non-taxable income
The annual tax return for 2017 introduces the possibility for declaring non-taxable income, inherited property or such received on the grounds of legacy and donation, as well as property with restored ownership rights received by virtue of legislative acts. The purpose of this amendment is to allow tax liable persons to declare their entire income for the year, which can subsequently facilitate tax checks and tax audits performed by the revenue authorities.
Certifying taxes and social security contributions paid abroad
The scope/type of documents which the tax liable person may use to prove the amount of taxes and social security contributions paid abroad is expanded. Local tax residents can attach “pieces of evidence” to their 2017 personal income tax return proving the amounts of taxes and mandatory social security contributions paid abroad, instead of official “certificates” issued by the competent authorities of the other state.
Reporting obligations for companies which are payers of income
Tax return under Article 55 of the PITA
There is an obligation for filing the return under Article 55 of the PITA electronically in cases where the filing obligation has arisen after 31
Report under Article 73 of the PITA
The deadline for filing the report under Article 73 of the PITA is also changed from 30 April to 15 March of the following year. This amendment becomes effective with respect to the 2017 report.
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