Business owner's salary and social securities - how to pay yourself?

As a business owner most probably, you would want to receive a personal income from your business operations. In Bulgaria you have few options to do that. Let's see what your legal obligations in the different scenarios are. The amounts below are for 2026, in euro.

I. You are the owner and manager of your company (you do manage the business, but you don't actively participate in the daily business operations) 

In this scenario you will need to have a management contract and pay yourself a salary. The gross salary you pay yourself cannot be lower than the minimum wage of €620.20, or than the minimum insurable income for your company's main activity, which is higher for some activities. Social securities you will be paying on this salary are identical to the social security paid on labor contract - for €620.20 gross salary your full expense will amount to around €738–742 (the employer's contributions are 18.52% plus 0.4–1.1% work-accident insurance). This cost will be tax deductible in your company and will save* you around €74 corporate tax (10%). *provided you paid your salary by the end of the year, if you delay paying yourself regardless of the reason the tax deduction will also be delayed.

II. You are the owner and the manager of your company (you manage the business and actively participate in the daily business operations)

In this case you have few options but in general you need to insure yourself for both types of work - managerial and operational. This means you will need to have a management contract and to be self-insured at the same time. The gross management salary cannot be lower than the minimum wage of €620.20 or the minimum insurable income for your company's main activity, and the minimum amount for self-insurance is €620.20 from 1 August 2026 (€550.66 until 31 July 2026). When it comes to actually paying yourself in this scenario you have a few possible combinations

1. Get your salary from the management contract - similar to scenario I. the social securities you will be paying on this salary are identical to the social security paid on labor contract - for €620.20 gross salary your full expense will amount to around €738–742. But in this case, you will also be obligated to be self-insured until your insurance income reaches the maximum of €2,300 (€2,111.64 until 31 July 2026). For example, management contract for €620.20 + self-insurance on €620.20 will be the minimum possibility which will cost you around €740 for the management contract + €172.42 (or €194.13 if you also insure for sickness and maternity) for self-insurance social securities*. Total cost is around €910–936 but only around €740 will be tax deductible in your company. *It is not mandatory to actually pay yourself a salary for the operational work, but it is mandatory to pay the social security securities on it. The amounts apply from 1 August 2026; until 31 July 2026 the minimum self-insurance was €153.08 (or €172.35).
2. Get paid for your operational work  - in this case you can have a management contract which pays you €0 and additionally pay yourself for the operational work you do via self-insurance. This way you won't pay social securities for you management contract and only for your self-insurance. In this scenario you can choose to pay yourself less then the minimum wage of €620.20 gross but of course you will still need to pay social securities on at least €620.20 (€550.66 until 31 July 2026). For example let's say you choose to pay yourself €620.20 gross, on top of that you will pay €172.42 (or €194.13) social securities, and around €43–45 personal tax is withheld from the gross, so your total cost will be around €793–814 and €620.20 will be tax deductible in your company and will save* you around €62 corporate tax. *provided you pay your salary by the end of the year, if you delay paying yourself regardless of the reason the tax deduction will also be delayed.

III. You are the owner of your company but not the manager (you don't manage the business, but you actively participate in the daily business operations)

In this case you can pay yourself as a self-insured owner. You are obligated to be self-insured for at least €620.20 from 1 August 2026 (€550.66 until 31 July 2026), with social securities of €172.42–194.13 a month, but you are not obligated to pay yourself a salary. If you choose not to pay yourself your social securities will be your personal cost and not your company's. If you decide to pay yourself, your salary will be tax deductible in your company, but your social securities won't. For example let's say you choose to pay yourself €620.20 gross, on top of that you will pay €172.42 (or €194.13) social securities, and around €43–45 tax is withheld from the gross, so your total cost will be around €793–814 and €620.20 will be tax deductible in your company and will save* you around €62 corporate tax.*provided you pay your salary by the end of the year, if you delay paying yourself regardless of the reason the tax deduction will also be delayed.

To see exactly what you would pay as a self-insured owner on the income you choose, use our owner's social security calculator; for net pay and the cost to the company, use the salary calculator.

IV. You are a passive owner of your business (you don't manage the business and you don't participate in the daily business operations)

If that's the case, you don't need to pay social securities and you can receive dividends from your company's profit. Profit is taxed with 10% corporate tax and if afterwards distributed as dividend it is taxed with additional 5% tax. As a business owner you are allowed to receive dividends even if you fall into one of the previous scenarios provided your company is profitable. 

V. What if I have an active labor contract with my employer while I own a business?

No problem! All the previous scenarios are applicable to you, and you just need to make sure you don't pay social securities over the maximum insurable income of €2,300 (€2,111.64 until 31 July 2026). * When you have various personal incomes there is an order in which social security is paid: First your labor contract will be charged with social securities. Then if your gross salary is under the maximum insurable income your management contract will be charged. Then if you're still under the maximum you will pay social securities for your self-insurance. *10% personal tax is paid on all amounts and is not limited to the maximum insurable income.

This article outlines the main scenarios you can choose from. Certainly, there are more details to the topic and it is important to talk to an accountant before you commit to any of them. A good accounting professional will be able to help you choose the best one that is legally correct and that will optimize your costs.

Sources: NRA, self-insured persons; NOI, insurable income from 1 August 2026; NRA, 2026 contribution rates; Council of Ministers Decree No. 243/13.11.2025 (minimum wage); NRA, dividend tax.