Accounting of a small winery in Bulgaria.

Running a small winery in Bulgaria requires not only a passion for producing quality wines, but also a deep understanding of specific accounting and tax requirements. Companies in this sector face unique challenges related to regulations on excise goods, registration of tax warehouses and strict accountability rules for wine produced and sold.

The team of Elan Consultingoffers expert assistance in the field of accounting and tax optimization for small wineries. Our professionals will help you understand how to properly maintain your accounting documentation, deal with mandatory regulations and optimize your activity, complying with the requirements of Bulgarian legislation. Whether you are just starting your business or are already an established producer, we will provide you with the necessary expertise and support for the sustainable development and success of your winery.

Find out what are the requirements for opening a small winery in Bulgaria here!

What are the peculiarities of accounting of wineries and wine-making enterprises in Bulgaria?

The accounting of wine-producing enterprises in Bulgaria has a number of features that are regulated by various regulatory acts, including the Law on Wine and Spirits (VVSN) and related by-laws, such as those concerning distillation, reporting and labeling of wine products. In addition, special attention is paid to accounting for inventories, manufactured output, and depreciation of assets used in production.

The main focus in the accounting of wine-making enterprises is on the correct accounting of production processes and commodity stocks, strictly observing the provisions for declaring the grape harvest and the quantities of wine and distillates produced. According to art. 1, para. 1From the Ordinance on the conditions and procedure for registration of producers of wine and other grape products, each producer is obliged to register with the National Vine and Wine Chamber (NLVK). This ensures that the enterprise complies with all requirements related to the production and trade of wines and spirits.

An important aspect of accounting in these enterprises is the management of secondary products that are obtained in the production process. According to art. 2, para. 1by Ordinance No. 106, these products must be handed over to registered distilleries for distillation. This requires wine producers to keep strict accounts of the quantities of by-products that are processed or sold.

Another important element is the accounting of costs for the production of wine and wine products. According to the National Accounting Standards (NSS), wine-producing enterprises must keep current accounting records of inventories, including grapes, wine must and finished wine, accounting for the depreciation of their assets in accordance with NSS 1.

Also, the accounting of the produced and sold production is mandatory and regulated by special accompanying documents when transporting grapes and wine. Art. 3The Ordinance on Accompanying Documents for the Carriage of Grapes and Wines stipulates that all shipments of these products must be accompanied by an accompanying document in order to ensure the correctness of the quantities reported.

The labelling and commercial presentation of wines are also subject to special requirements. According to The Ordinance on the Designation and Commercial Presentation of Wines, each wine must have a label that provides accurate information about the origin, grape variety and product characteristics. This is important for consumers and supervisors.

What accounting and tax obligations does a winery have?

Wineries in Bulgaria are subject to specific accounting and tax obligations, which arise both from general legislation and from specialized normative acts regulating the production, trade and tax treatment of winemaking. These obligations are related to the correct accounting, compliance with the tax requirements under the Corporate Income Tax Act (CPA), the Value Added Tax Act (VAT), as well as the Excise and Tax Warehouses Act (ZADC).

1. Accounting and inventory of production

According to the Accounting Act and the National Accounting Standards (NSS), wineries are obliged to keep current accounts of the inventories related to the production of wine. This includes the accounting of all raw materials such as grapes, auxiliary materials, as well as finished products. According to NSS 2(CPC), the costs of production, including transport, energy and consumables, must be properly reflected in the accounting records.

Wineries must regularly carry out an inventory of their production, including finished wine and intermediate products such as must and must. Each batch of wine produced must be duly recorded and labelled, and the data on the wine concerned must be kept and, if necessary, made available to the controlling authorities.

2. Taxation of income

Proceeds from the sale of wine are subject to corporate tax under The Corporate Income Tax Act (CPA). According to Article 20 of the CPA, the profits of wineries are taxed at a tax rate of 10%, and the winery is obliged to file an annual tax return and prepare a financial statement that includes the income and expenses for the respective year. The winery is entitled to use depreciation deductions for its fixed tangible assets (DMA), including vineyards, production and storage facilities.

3. Value Added Tax (VAT)

Wineries that have a turnover of more than BGN 100,000 per year are obliged to register under Value Added Tax (VAT) Act. After registration, the winery must charge VAT on its sales of wine and other products by issuing invoices with tax included. In the case of export or sale to countries of the European Union, the winery can benefit from a zero VAT rate, subject to the relevant documentation requirements.

4. Excise duties

Wine, unlike spirits, is not subject to excise duty when it is produced and sold in Bulgaria. However, if the winery produces and sells other spirits such as brandy or grape distillates, it is obliged to register as a tax warehouse and charge excise duty on the quantities produced according to Excise Duties and Tax Warehouses Act (ZADC). In addition, the winery must keep records of all products produced and sold, as well as submit excise declarations to the Customs Agency.

5. Accounting and documentation in the production and sale of wine

According to specialized regulatory enactments, including Ordinance No. 1 of 10.10.2006and Ordinance No. 106 of 23.08.2006, wineries must keep special accounts of the production and trade of wine. This includes filing grape declarations, accounting for the quantities produced and documenting all commercial transactions related to the sale of wine. Each shipment of wine must be accompanied by a document certifying the origin and quantity of the product transported.

6. Licensing and labelling

Wineries are obliged to obtain a license for the production and marketing of wine from the relevant control bodies and to comply with all requirements for labeling of products. The labels must contain information on the origin, grape variety, as well as information on the content of alcohol and sugars. This ensures the correctness of the products offered on the market and protects the rights of consumers.

7. Reporting to the National Viticulture and Wine Chamber (NLVK)

Each winery is obliged to submit regular reports to the National Viticulture and Wine Chamber (NLVK), which monitors compliance with quality standards and control over production. This includes annual declarations of quantities produced and sold, as well as accounting for residual products from winemaking.

Why trust Elan Consulting for the accounting of a small winery?

Choosing “Elan Consulting” for the accounting of a small winery is the right decision if you are looking for a partner with deep expertise in the field of accounting and the specific tax and regulatory requirements of the wine industry. Our team specializes in providing comprehensive accounting services that ensure accurate, transparent and efficient management of all financial and legal aspects of your winery. We understand the specific needs of small winemakers and can offer you customized solutions that will make it easier to manage your business and ensure compliance with all legal requirements.

The first reason to choose Elan Consulting is our deep knowledge of the regulations related to winemaking. Our team is fully familiar with the Law on Wine and Spirits and related regulations governing the production and trade of wines. This includes specialized reporting, which is mandatory for wineries, such as declaring the grape harvest, keeping records of the quantities of wine produced, and accounting for sales in accordance with the applicable regulations. We will help you maintain correct reporting and comply with all legal requirements without stress and errors.

The second reason is the personalized approach we apply to each winery, regardless of its scale. We understand that small wineries have specific needs and constraints related to production costs, inventory maintenance, and wine sales revenue management. Our experts will take care to optimize your tax burden by helping you make the most of your tax relief options, including asset depreciation, deducting recognized expenses, and correct income reporting.

In addition, we offer comprehensive support in the registration under the Value Added Tax Act (VAT) and reporting under the Corporate Income Tax Act (CPA). This includes managing VAT on wine sales, issuing invoices, declaring turnover and assisting with tax inspections. We will ensure that your tax obligations are met on time and correctly, reducing the risks of errors and penalties.

“Elan Consulting” has extensive experience in the field of winemaking and can help you not only with accounting, but also with strategic advice on expanding your business and increasing profitability. We are here to provide you with professional support in every phase of your winery's development, from initial registration and declaration of production to long-term financial growth strategies.

Finally, Elan Consulting offers competitive prices for its services, while guaranteeing high quality and attention to detail. Our goal is to make it easy to manage your business so that you focus on producing quality wine while we take care of the financial and legal part. By choosing Elan Consulting, you get security, professionalism and trust — everything you need for the successful management of your small winery.

Frequently Asked Questions

What are the obligations of the winery when selling wine in the country?

When selling wine in Bulgaria, the winery has the obligation to issue invoices for each sale, and in case it is registered under the Law on Value Added Tax (VAT), it must charge and report VAT. Wine is not subject to excise duty in Bulgaria, but the winery is obliged to submit reports for the quantities produced to the National Vine and Wine Chamber (NLVK), as well as to comply with the rules for labeling and sale according to the Ordinance on the Designation and Commercial Presentation of Wines. When transporting wine, each consignment must be accompanied by a document of origin.

What are the tax obligations of a small winery if the income does not exceed BGN 100,000 per year?

If the turnover of a small winery does not exceed BGN 100,000 per year, it is not obliged to register under the Value Added Tax Act (VAT), unless it chooses voluntary registration. In such a case, the winery can file tax returns without charging VAT. However, it remains obliged to file annual tax returns under the Corporate Income Tax Act (CPA) to tax profits with 10% corporate tax. In addition, it must keep accounting for all income and expenses related to its activities.

What is the procedure for issuing documents for grape harvest and wine production?

Each winery is obliged to submit a declaration of grape harvest and wine production to the National Viticulture and Wine Chamber (NLVK). The declaration shall indicate the quantities of grapes harvested and wine produced, as well as details of the processing of the harvest. In addition, when transporting grapes or wine, each consignment must be accompanied by documents certifying the origin and quantities of the production. These documents are necessary both for internal control and for the provision of data during inspections by state bodies.