SFSK shares the Key Implications for ACcountants & Auditors
Bulgaria will officially adopt the euro as its national currency on 1 January 2026, becoming the 21st member of the euro area. The Bulgarian lev, fixed at 1 EUR = 1.95583 BGN since 1997, will be replaced, following the convergence criteria confirmed by the European Commission and ECB in June 2025.
The Law on the Introduction of the Euro in the Republic of Bulgaria outlines the legal and technical framework for this transition. Below are the most relevant points for accounting and audit professionals.
All monetary values (prices, accounts, capital, shares) will be converted at the fixed exchange rate, without initial rounding. Final amounts will be rounded to two decimal places using standard rounding rules. Special rules apply for pensions, wages, and social payments, which are always rounded up when there is a remainder beyond the second decimal..
The conversion will not affect shareholder rights. Ownership proportions remain intact. Minor rounding differences will be recorded as retained earnings or losses. For limited liability companies, capital adjustments up to 5% are allowed without following the usual procedures under the Bulgarian Commercial Act.
From 2025 onwards, financial statements must include euro-converted comparative data. On 1 January 2026, all account balances must be converted to euros. Businesses must update accounting, payroll, billing, and POS systems at least three months before the euro introduction. Prices must be dual-displayed in BGN and EUR from 8 August 2025 to 1 January 2027.
Tax thresholds and reporting will shift to euro values. For instance, the VAT registration threshold becomes EUR 50,000 (equivalent to BGN 97,791.50). Returns for periods before 1 January 2026 will be filed in BGN, but taxes will be paid in EUR at the fixed rate. All existing contracts will remain valid and are automatically converted to euros. No unilateral changes or cancellations are allowed due to the currency change.
Bank accounts will be automatically converted into euros with no fees. The Commercial Register will update capital values in euros automatically on the date of the euro's introduction. Companies must update internal corporate documents (for ex., articles of association) by 31 December 2026. No government fees apply for this update.
The introduction of the euro promises greater economic stability and reduced currency risk. Accounting professionals require:
Proactive planning and collaboration with authorities will ensure a smooth and successful transition for businesses and their clients.
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Image attributes: Bulgarian Flag / Euro Money
