Employer of Record (EOR) in Bulgaria

An EOR in Bulgaria allows businesses to enter the market quickly and help maintain compliance with local laws, all while reducing the overhead costs of establishing a local entity. Atlas HXM offers a seamless EOR service that handles all aspects of employment from payroll processing to compliant administration.

Partner with Atlas HXM for a cost-effective, compliant solution to hire and manage your workforce in Bulgaria.

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Country InsightsBulgariaEmployer of Record

Quick Overview of EOR in Bulgaria

Expanding into Bulgaria doesn't have to mean drowning in paperwork or hefty setup costs. With an Employer of Record (EOR), you can bypass the complexities of local regulations and quickly hire employees, all while maintaining compliance with Bulgaria's labor laws. From payroll processing and tax compliance to benefits management, an EOR takes care of the legal nitty-gritty like social security contributions, so you can focus on growing your business without the need to set up a costly local entity.

The EOR model offers a low-risk, cost-effective alternative to setting up a subsidiary. Establishing a local entity in Bulgaria can cost anywhere from USD 7,700 to USD 15,400 (EUR 7,000 to EUR 14,000) plus the cost of maintaining human resources (HR), legal assistance, accountants and more. It can also become highly administrative. By partnering with an EOR, you can avoid these setup costs and enter the market faster, avoiding the overhead of a physical office. This is especially beneficial for startups, SMEs, and businesses testing new markets, who need to act quickly and comply with complex local regulations.

The contents of this article is not legal advice and should be used for reference only. If in doubt, please seek independent legal advice from a lawyer in the relevant jurisdiction.

The information provided in this article is provided for general informational purposes only. Accuracy, completeness, or reliability is not guaranteed. This content does not constitute legal, professional, or other advice and should not be relied upon. Any use of the information is at your own risk. Users are responsible for independently verifying any information. All materials are provided "as is," without any warranties of any kind, express or implied and Atlas Technology Solutions, Inc. disclaim all liability arising from use of, or reliance on, this content

What You'll Learn

  • Looking to hire in Bulgaria without the hassle and administrative burden of setting up a local entity? An EOR helps you onboard employees while maintaining compliance with payroll and local labor laws.

  • With a Direct EOR, you gain control, faster onboarding, and stronger compliance. It is ideal for businesses aiming to scale quickly.

  • On the other hand, an Indirect EOR may be more cost-effective but comes with slower processes and added complexity.

  • EOR service fees typically range from USD 200 to USD 600 (EUR 180 to EUR 540) per employee per month.

  • Atlas HXM offers a robust Direct EOR solution, providing smooth market entry, compliance, and seamless employee management: all in one platform.

How an EOR Works

Atlas HXM provides EOR services that ensure your business remains compliant with Bulgaria's labor laws while you focus on growing your operations, free from administrative and legal burdens.

Candidate Selection

Atlas HXM does not recruit candidates but will check the employment setup for compliance around new hires like validating right-to-work, reviewing contract terms against Bulgarian rules, and configuring payroll and statutory obligations correctly.

Employment Contracts

Atlas HXM drafts and administers employment contracts in compliance with the Bulgarian Labor Code. In the contract, we clearly outline employment terms to reduce the risk of future disputes, such as:

  • Job title and responsibilities

  • Salary, benefits, and working hours

  • Leave entitlements and notice periods

Payroll & Benefits Management

Payroll is processed in Bulgarian Lev (BGN), including:

  • Accurate tax withholdings and social security contributions

  • Statutory benefits such as health insurance and pension contributions

The EOR also helps maintain compliance with mandatory benefits, so employees are protected under Bulgaria's laws.

Ongoing HR Support

Provides HR support, including: Leave management, employee relations and regulatory updates throughout the employee's tenure. This allows businesses to focus on core operations, while Atlas HXM handles ongoing compliance.

Costs & Pricing

EOR services in Bulgaria are typically billed as a platform/service fee in the range of USD 200–600 (EUR 180–540 / BGN 360–1,080) per employee per month. This fee covers administration such as compliant contracts, payroll processing, statutory filings, and HR administration for workers. This service fee is separate from the employee's salary, benefits, taxes, and permit-related costs, which vary by role and jurisdiction. By using an EOR, companies avoid the cost and overhead of setting up a Bulgarian entity, which can require USD 7,700–15,400 (EUR 7,000–14,000) upfront before any operational spend.

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What to Choose: EOR vs PEO

EOR

Employer of Record

An EOR becomes the legal employer for your talent in a country where you do not have an entity. The EOR handles compliant contracts, payroll, statutory benefits, tax filings, and labour-law adherence. You still direct the employee's work. This model suits companies expanding into Bulgaria without wanting to form a local entity or take on compliance risk.

PEO

Professional Employer Organization

A PEO provides outsourced HR services like payroll, benefits, HR admin, but only when you already have a local entity. You remain the legal employer, and the PEO shares administrative tasks without taking on employer liability. Suitable when you are already established in the country and are only looking to offload HR administration.

What’s Best for You?

  • Choose an EOR when you want to hire in Bulgaria without setting up an entity and want a partner who can take on contracts, payroll and compliance.

  • Choose a PEO when you already operate locally and just want HR support.

Work Life in Bulgaria

Bulgaria's employment framework is designed to balance operational needs with employee protections. Here's what you need to know:

Employment Types:

  • Permanent: Indefinite-term contracts with full statutory benefits.

  • Fixed-Term: Maximum 3 years with possible extensions for specific projects or defined duration.

  • Temporary: Short-term assignments; entitled to statutory benefits like leave and overtime.

Probation Periods: Employment contracts can include probationary periods up to 6 months (or 1 month for contracts under 1 year). These periods allow employers to assess employee suitability before confirming permanent employment. During probation, employees have all rights and duties of a final employment contract, and the EOR ensures that all terms comply with the Labor Code.

Working Hours & Overtime: In Bulgaria, the standard workweek is 40 hours, with a maximum of 8 hours per day (reduced to 7 hours for risky environments or employees under 18). Extended working hours up to 10 hours per day are permitted with written authorization. For eligible employees covered by the Labor Code, overtime is paid at premium rates: 50% above standard wage for working days, 75% for weekends, and 100% for public holidays. The EOR ensures that all overtime is calculated correctly and that employee work hours comply with local regulations.

Leave Entitlements

Leave Type

Eligibility / Duration

Payment / Notes

Annual Leave

Minimum 20 days after 4 months service; 26 days for under 18

Paid by employer; additional days for hazardous work

Maternity Leave

410 days total (45 days before delivery)

Paid by National Social Security Institute

Paternity Leave

15 days from delivery; additional options available

Paid leave for working fathers

Sick Leave

After temporary disability certification

70% pay first 2 days (employer), 80% thereafter (NSSI)

Public Holidays

All statutory holidays

Paid; handled by Atlas HXM

Vacation Leave

As per company policy / statutory minimum

Paid; unused leave typically paid out upon termination

Payroll & Benefits: Wages must meet minimum wage requirements (BGN 1,077 monthly, increasing to BGN 1,213/EUR 620 in 2026). Atlas HXM manages payroll in BGN, social security contributions (employer and employee), statutory benefits, bonuses, and private health insurance. Supplemental benefits can include meal vouchers, transportation allowances, and professional development options.

Atlas HXM can help you manage these aspects and can help ensure that employees are supported and compliant with Bulgaria's labor laws while businesses can focus on operations without administrative burdens.

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What to Choose: Direct vs Indirect EOR

Direct EOR

The EOR owns the legal entities in the target country and manages employment directly. This model offers faster onboarding, stronger compliance oversight, and greater operational control across all employment processes.

Best for: A Direct EOR model is a strong and reliable option for businesses of any size entering Bulgaria. Whether hiring one employee or building a larger team, it provides a compliant, structured framework from day one.

Indirect EOR

The EOR provider operates through a third-party local entity. While it can be used in certain scenarios, it may introduce additional coordination layers and potential compliance complexity.

What’s Best for You?

  • With Atlas HXM’s direct infrastructure, companies benefit from streamlined onboarding, clear accountability, and consistent compliance support — without needing to establish a local entity.

Taxes & Compliance

Bulgaria operates on a calendar-year tax system, running from January 1 to December 31. Employers must submit monthly tax returns by the 15th of the following month, annual personal income tax returns by March 31st, and social security contributions by the 15th of the following month. VAT returns are due monthly or quarterly depending on turnover.

Category

Details

Employer Payroll Tax

Social security contributions: 19.6% total (pension 12.8%, health 4,8 %, unemployment 0,6%, occupational accidents 0.4-1.1%, guaranteed receivables 0.2%, professional qualification 0.6%)

Employee Payroll Tax

Flat income tax: 10% of gross salary

Employee social contributions: 13.78% total (pension 9.9%, health 3.5%, unemployment 0.4%)

Pension System

National Social Security Institute covers retirement pensions

Retirement age: 62.5 years for women (increasing to 65 by 2037), 64.75 years for men (increasing to 65 by 2037)

Minimum pension: EUR 322.27 per month

VAT & EOR Costs: Bulgaria applies a 20% VAT rate. EOR services are generally subject to VAT, either included in quoted fees or added separately. Businesses may need VAT registration depending on service volume and nature.

Atlas HXM handles tax compliance, including flat income tax calculations, social security contributions, year-end filings, and expatriate tax arrangements, ensuring businesses remain compliant with local laws while minimizing administrative burden.

Termination

Employees must give written notice for termination, with statutory minimum notice periods of 30 days for indefinite-term contracts (maximum 3 months) and 3 months for fixed-term contracts. An employment contract during the probationary period can be terminated without notice. Severance pay varies by termination reason: compensation for unemployment period (maximum 1 month) for company closure/redundancy, 2 months for illness-related dismissal after 5+ years service, and 2-6 months for retirement. The EOR helps ensure proper handling of terminations, including notice periods, final wages, and required documentation.

5 Things to Look for in an EOR Provider in Bulgaria

  1. Local expertise and knowledge of Bulgarian Labor Code, social security contributions, and Employment Agency requirements.

  2. Advanced technology for payroll, reporting, and HR system integration.

  3. Experience in your industry.

  4. Strong compliance track record and relationships with government agencies and legal advisors.

  5. Global presence to support multi-country expansion, with verified security and compliance standards (ISO 27001/27017/27018, GDPR).

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Atlas HXM provides direct EOR services, managing payroll, compliance and benefits efficiently. Atlas HXM's unified platform automates HR, payroll, and compliance tasks, while offering premium employee support, global benefits, and access to 9,000+ learning courses. Recognized by the Everest Group PEAK Matrix 2025 and NelsonHall NEAT Assessment 2025, Atlas HXM combines compliance, technology, and global expertise.

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FAQs

How quickly can I hire employees in Bulgaria through an EOR?

You can typically hire employees within 3-5 business days once you've identified your candidate and completed necessary documentation.

What is the minimum wage in Bulgaria?

As of January 1, 2024, the minimum wage is BGN 1,077 per month, increasing to BGN 1,213 (EUR 620) from January 1, 2026.

Do foreign employees need work permits in Bulgaria?

Yes, most foreign nationals need work permits. EU citizens and researchers are exempt. Several permit types are available.

What are the standard working hours in Bulgaria?

The standard workweek is 40 hours (8 hours per day), with extended hours up to 10 hours per day possible with written authorization.

How much annual leave are employees entitled to in Bulgaria?

Employees are entitled to at least 20 days of paid annual leave after completing 8 months of service, with additional days for hazardous work or employees under 18.

What are the employer social security contribution rates in Bulgaria?

Employer contributions total approximately 19.6% of gross salary, covering pension, health, unemployment, and occupational accident insurance.

         

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