First-home benefits

The last few years have been extremely favorable for buying your own home in Bulgaria. Alongside the currently low mortgage rates, young people and in particular young married couples can also benefit from tax relief.

If you are also among the families that financed the purchase of their first home with a mortgage loan, keep reading to find out how to take advantage of the tax relief for Young Families.

How can we take advantage of tax relief when buying a first home

The conditions you need to meet are the following:

1. to be legally married;
2. at least one of you to be under 35 years of age on the date the mortgage loan agreement is signed;
3. the mortgaged home to be the only home for your family during the tax year;
4. the mortgage loan agreement to be signed by you as the taxpayer and/or by the spouse with whom you are legally married;

What is the value of the relief

If you meet these requirements, the law allows you to deduct from your tax base the interest payments made during the year. It is important to know that the limit of the relief is 100,000лв. For example, if your loan is worth 150,000лв., you will be able to claim relief only for that part of the interest payments charged on the first 100 000 лв. of the loan.

Who can claim the relief

The relief may be claimed by resident individuals and by foreign individuals who are tax resident in an EU member state or in a country of the European Economic Area.

What documents will you need

For this purpose, you will need the following documents, attached to the annual tax return at the NRA:

1. a document from the lending bank certifying the amount of interest payments made during the year on the first 100 000 лв. of the principal of the mortgage loan for the purchase of a home
2. marriage certificate;
3. certificate of property status (the document is issued by the Registry Agency);
4. mortgage loan agreement;