Home renovation tax relief in Bulgaria: up to €102.26 less tax

If you paid for labour to renovate a home you own in Bulgaria during the year, you can reduce your taxable income by up to €1,022.58 (BGN 2,000 in the text of the law). With the 10% income tax, that is up to €102.26 less tax. If you are employed and your tax has already been withheld, the National Revenue Agency (NRA, in Bulgarian НАП) pays that amount back to you.

The relief is set out in Article 22e of the Personal Income Tax Act (in Bulgarian ЗДДФЛ) and has applied since 2021. It is available to Bulgarian tax residents and to residents of other EU or EEA countries who file a Bulgarian annual tax return. You claim it in the annual tax return: for labour paid in 2026, the deadline is 30 April 2027.

Few people use it. According to NRA data reported by Bulgarian National Television on 26 October 2026, 886 people claimed the relief for 2025 and 751 for 2024. The most common obstacle is that the work was paid for in cash, without an invoice. Without a document for the labour there is no relief.

How much you save

The relief is not a discount on the renovation bill – it reduces the income you pay tax on. So you save 10% of the labour you paid for during the year, up to €102.26.

The cap is per property, not per person. If the home is jointly owned – by a married couple, for example – each co-owner can use the relief, but the total for the property is up to €1,022.58. If you split it equally, €511.29 each, each of you pays €51.13 less tax.

The conditions – all of them at once

• The home is in Bulgaria and you own it or co-own it.
• You paid for labour to renovate or improve it. Materials do not count.
• The relief is for one residential property per year.
• The work was done by a company or a tradesperson established in Bulgaria or in another EU or EEA country.
• You and the contractor are not related parties – relatives, for example.
• You have a document for the labour paid – in practice, an invoice – and proof of payment: a bank statement, a till receipt or a receipt.
• The home is not part of a business you run as a trader, for example as a sole trader.
• On the day you file the return, you have no public debts subject to enforcement.
• You have taxable income – a salary, fees or rent. The relief is deducted only from that income.

The documents: where most reliefs are lost

The law requires a document for the labour paid with the details required by the Accountancy Act: number and date, the names and company number (UIC) or personal number of the issuer and the recipient, what was done and its value. In practice, that is an invoice. It must come with proof of payment.

• The labour must be shown separately, with a clear amount. If the invoice only says “bathroom renovation” with a total that also covers the tiles, adhesives and sanitaryware, it does not show how much the labour was – and the relief is only for the labour.
• The invoice should be in the name of the owner who will claim the relief.
• Pay by bank transfer. A bank statement is the safest proof of payment; if you pay in cash, ask for a till receipt.
• You do not attach the documents to the return, but keep them – the NRA may ask for them in an audit.

A tradesperson paid “cash in hand” may look cheaper, but without an invoice there is no relief. Usually there is no contract or written warranty to rely on either if something goes wrong.

How to claim it

1. During the year, keep the invoices for the labour and the proofs of payment.
2. Between 10 January and 30 April of the following year, file the annual tax return under Article 50 of the Personal Income Tax Act – the easiest way is online, through the NRA portal.
3. In Appendix No. 10 of the return – the tax reliefs – enter the labour paid for the renovation, up to €1,022.58.
4. If you are employed, your tax has already been withheld. The difference is refunded to the bank account you give in the return.

The relief works year by year. If the renovation is also paid for in 2027, the payments made in 2027 go into the return for 2027 – with the same conditions and the same cap.

For your own situation you can ask the NRA information centre on 0700 18 700. This article is general information, not tax advice.

How we work

We are a registered company – REMONT EXPERTS EOOD, UIC 208637944 – and we work with a written quote and a contract. In the quote the labour is itemised and the materials are on a separate line, so the labour can be shown separately on the invoice. Tell us when you sign the contract that you will claim the relief.

• A written, itemised quote with the labour separate from the materials.
• A fixed-budget contract with payments in stages by bank transfer.
• Invoices for the payments – with the labour on a separate line if you will claim the relief.
• A handover protocol and a written warranty: 2 years on all work and 6 years on plumbing, electrics and roofs.

For contracts signed by 31 December 2026 you also get 10% off the whole quote – on the labour and on the materials we supply. The discount and the tax relief add up.

If you are planning an apartment renovation or a bathroom renovation, book a free site visit or call us on +359 888 802 618 – we reply to every enquiry within 3–4 hours. Our price list, where the prices are for labour, and the calculator give you a guide to the cost.

Frequently asked questions

Does the relief cover materials?

No. The law only covers payments for labour. Tiles, adhesives, paint and sanitaryware cannot be deducted, even if they are on the company's invoice.

Can I use it for two properties?

Not in the same year – the relief is for one residential property per year.

The tradesperson is a relative. Does it count?

No. You and the contractor must not be related parties.

I am retired. Can I use it?

Only if you also have taxable income, such as rent or fees under a civil contract. The relief is deducted from taxable income, and Bulgarian state pensions are not taxed.

Do I attach the invoices to the return?

No. You keep them and show them if the NRA asks.

When is the return due?

Between 10 January and 30 April of the following year. For a renovation paid for in 2026 – by 30 April 2027.