Bulgaria Proposes Mandatory E-Invoicing and Real-Time VAT Reporting from 2028

Context

The proposed amendment represents Bulgaria's first detailed legislative step toward adopting a centralized e-invoicing clearance model, aligning with broader EU tax digitization trends. The draft VAT Act amendment was published on September 23, 2026, and has not yet been enacted into law. The public consultation period is open until October 23, 2026.

Under the draft proposal, VAT-registered suppliers would be required to issue structured electronic invoices for supplies made to taxable persons, non-taxable legal persons, or state and local authorities established in Bulgaria. These invoices must comply with the European e-invoicing standard and carry a unique compliance code generated by the National Revenue Agency (NRA) system. Notably, an invoice is only deemed legally issued once the NRA generates this compliance code.

What's Changing

The draft amendment introduces several significant changes to Bulgaria's VAT reporting landscape. First, suppliers using external invoicing software or ERP systems would be required to transmit invoice data to the NRA immediately in real time following document creation or cancellation. The NRA would operate a national system receiving this data and generate pre-filled VAT returns for each tax period, made available by the second day of the following month.

The proposed changes also have significant implications for VAT deductions. Failure to issue a required structured e-invoice would disqualify the recipient from claiming input VAT deduction. This linkage between invoice format compliance and deduction rights creates a strong enforcement incentive for both suppliers and recipients.

A new penalty regime for failing to issue required structured e-invoices is scheduled to take effect from July 1, 2028, providing a six-month grace period after the January 1, 2028 implementation date. The NRA is also expected to provide a testing environment during the six months preceding implementation.

Intra-Community supplies and triangular transactions are explicitly permitted to remain outside the proposed structured e-invoicing format under the current draft.

Implications for Businesses

The proposed amendment presents both challenges and opportunities for businesses operating in Bulgaria. Compliance with the new e-invoicing requirements will necessitate significant investments in IT infrastructure and software upgrades. Businesses must ensure their invoicing systems can generate structured e-invoices compliant with the European standard and integrate with the NRA system to obtain compliance codes.

The real-time reporting requirements will also demand robust data management and transmission capabilities. Businesses must be prepared to transmit invoice data to the NRA immediately upon document creation or cancellation, which may require updates to existing ERP systems.

The linkage between e-invoice compliance and VAT deduction rights creates a strong enforcement mechanism. Suppliers must ensure they issue compliant e-invoices to enable their customers to claim input VAT deductions. Similarly, recipients must verify the receipt of structured e-invoices to protect their deduction rights.

Outlook

The proposed amendment represents a significant step in Bulgaria's tax digitization journey. The draft is currently open for public consultation until October 23, 2026. Businesses are encouraged to participate in the consultation process and provide feedback on the proposed changes.

The NRA is expected to provide a testing environment in the six months leading up to implementation. This will allow businesses to test their systems and ensure compliance with the new requirements.

The proposed effective date of January 1, 2028, provides businesses with approximately 15 months to prepare for the changes. However, given the complexity of the requirements, businesses should begin preparing as soon as possible to ensure a smooth transition.