How a Bulgarian Company Pays Influencers Abroad: Tax Rules (2025)
Working with influencers and content creators from other countries 🌍 has become a standard part of modern digital marketing. Bulgarian companies increasingly collaborate with international creators on platforms such as YouTube, Instagram, TikTok, blogs, and affiliate networks. While the marketing strategy is usually clear, the tax and accounting treatment when paying influencers abroad often raises uncertainty.
This article explains in a clear and practical way how Bulgarian companies should handle payments to foreign influencers in 2025, what taxes may apply, and which documents are required to ensure full compliance ✔️.
How influencer services are classified under Bulgarian tax law
The first and most important step is identifying the nature of the service. In most cases, influencer activities are classified as advertising or marketing services. These typically include:
- sponsored posts and video content;
- product reviews and social media stories;
- affiliate marketing campaigns;
- long-term brand promotion and visibility.
From a tax perspective, it does not matter whether the influencer operates as an individual or as a registered company. What matters is where the service provider is established and how the VAT place-of-supply rules apply. When the influencer is based outside Bulgaria, the service is treated as cross-border.
VAT treatment when paying influencers abroad
VAT rules for cross-border services are based on the place-of-supply principle. For advertising and marketing services provided to a Bulgarian company, the general rule usually applies.
In practice, this means that:
- the influencer issues an invoice without Bulgarian VAT;
- the Bulgarian company records the expense without VAT;
- for EU-based providers, the reverse-charge mechanism often applies 🔄.
The correct VAT treatment depends on whether the influencer is VAT registered and whether they are established in the EU or outside the EU. Checking the provider’s status before making any payment is therefore essential.
Withholding tax – when does it apply?
One of the most frequently overlooked aspects when paying influencers abroad is withholding tax. Under Bulgarian tax law, certain payments to foreign individuals or companies are subject to a 10% withholding tax.
Marketing and advertising services may fall within this scope unless a Double Tax Treaty applies. If such a treaty exists, the withholding tax rate may be reduced or eliminated, but only if the Bulgarian company holds a valid tax residency certificate 📄.
Required documentation
Proper documentation is essential for tax compliance and audit protection. Each payment to influencers abroad should be supported by:
- an invoice for the provided service;
- a contract or written agreement;
- a tax residency certificate;
- evidence of performance, such as links, reports, or analytics 📊.
Paying influencers abroad is a fully legal and effective business practice when structured correctly. Incorrect VAT or withholding tax treatment can lead to additional tax liabilities, interest, and penalties ⚠️.
T&G Consulting supports Bulgarian companies working with foreign influencers by ensuring correct VAT treatment, proper withholding tax analysis, and full compliance with Bulgarian and international regulations. With professional guidance, international influencer marketing becomes a safe and sustainable growth tool 🚀.
Contact T8G Consulting today to prepare your business for the future—without surprises. For useful and insightful content, visit our partners’ channel!
❗ This content provides general information and does not constitute tax, accounting, or legal advice. Each situation is different and should be reviewed individually.