Bulgaria's National Revenue Agency (NRA) has increased its scrutiny of individuals involved in online trading and content creation. In the first half of 2024, 144 audit cases and 2,615 inspections were assigned to 129 e-traders, revealing discrepancies that led to additional tax and social security liabilities amounting to 67.6 million leva. The inspections also targeted influencers who generate income from social media platforms through advertising, with a focus on YouTubers, vloggers, and independent journalists. By mid-2024, the tax authorities had assigned 30 audit proceedings to popular internet personalities, 15 of which were completed. In 13 of these cases, undeclared income was identified, leading to voluntary declarations of income totaling about 80,000 leva in taxes and social security contributions.

In addition to monitoring online traders, the NRA has conducted thorough inspections of individuals owning luxury cars and expensive properties. A total of 551 luxury car owners were examined in the first half of the year. Of the 474 inspections completed, discrepancies were found between the reported income and the expensive vehicles owned, with liabilities totaling 5.15 million leva. Some individuals took corrective action by submitting updated declarations and paying the required taxes, while others faced administrative penalties. Inspections also extended to those leasing high-priced vehicles, with 57 cases reviewed and tax liabilities of 275,000 leva established for five individuals. Furthermore, tax audits were carried out on 400 Bulgarians who purchased properties worth over 750,000 leva between 2019 and 2022, uncovering 1.836 million leva in undeclared income.

The NRA's efforts to ensure accurate income reporting extend to individuals who have not declared earnings from various commercial activities. The agency has stepped up its campaign to identify those who may have understated their earnings or neglected to declare them altogether. As part of this initiative, the NRA has begun notifying individuals who may have discrepancies in their tax returns, urging them to correct the inaccuracies. Individuals identified in this manner will be required to submit an amended tax return within 14 days.

This inspection campaign follows a broader effort by the NRA to address tax evasion, focusing on high-net-worth individuals, online entrepreneurs, and influencers. With the increase in online business activities and the growing popularity of social media as a revenue source, the NRA aims to close gaps in tax reporting and ensure that all taxable income is accurately declared. The campaign also includes direct outreach, with the agency contacting those whose declared income does not match available information or who have failed to submit accurate tax returns. For any queries regarding income declaration, individuals can reach out to the NRA Information Center.

Background:

Since the beginning of 2023, the NRA has intensified efforts to inspect individuals earning income through online platforms and other non-traditional means. With a focus on internet personalities and influencers, the agency has uncovered numerous cases of undeclared income from advertising and content creation. The inspections are part of the broader strategy to combat tax evasion, ensuring that all income, regardless of source, is properly reported and taxed. The tax authority's work also includes verifying the financial status of individuals owning expensive assets, such as luxury cars and real estate, with audits aimed at identifying any discrepancies between declared income and asset ownership. Through this campaign, the NRA hopes to improve compliance and curb the growing issue of tax evasion in Bulgaria.