Direct Tax Consulting

1. Local and International tax structuring

We assist our clients in structuring of their investments. Based on our local tax knowledge and liaison with the tax authorities we help our clients understand better the Bulgarian tax consequences of their business activities and strategies, reduce exposures and implement economically and tax efficient practices.

We also support them in obtaining tax benefits from applicable Double Tax Treaties.

Our services are aimed at achieving sustainable tax efficient acquisition and disposal of investments in Bulgaria and abroad as well as tax optimisation of the flow of funds within corporate groups.

The international network of PwC allows quick and efficient access to the knowledge and experience which our clients need.

2. Transaction tax support

Our M&A tax team provides to clients the benefits of international expertise and in-depth understanding of the local business environment. Our solutions include:

• Due Diligence reviews

We identify potential tax liabilities, evaluate the tax benefits of asset or share deals and address issues, which may affect the deal price and contractual framework. We take into consideration all Bulgarian taxes and similar levies, as well as the applicable statutes of limitation. This approach results in an improved valuation and overall assurance to both current and future investors.

• Advice in structuring the transactions

We evaluate the tax impact of the transaction on both the company and its shareholders and assist in minimising a group’s tax burden and enhance cash-flows and profits. We examine deductibility of transactions costs, consider the impact of the Bulgarian thin capitalisation / interest limitation restrictions and advise on available tax planning opportunities, including specific tax incentives (where relevant).

• Post deal advice and assistance

In the period after a major transaction – merger, acquisition or buyout – it is imperative that management is able to rapidly and effectively implement its business strategy. Our services during this critical period will help ensuring that tax is a controlled and value driven function.

3.  Transfer pricing

We help our clients analyzing inter-group and related party transactions and adapt their transfer pricing policies to the local conditions and requirements. Our assistance includes:

• Development of transfer pricing policies
• Preparation of benefit tests analysis substantiating the actual provision of the services by related parties and the respective benefit derived
• Analysis of inter-company agreements in order to identiy transfer pricing issues
• Analysis of proposed business models or group business restructurings from a transfer pricing perspective
• Assistance in complying with the Country-by-Country reporting requierments  introduced in Bulgaria in FY 2017
  
• Assistance during tax procedures performed by the tax authorities in the transfer pricing area (i.e. tax checks, audits, advance clearance procedures)
• Providing assistance to international clients regarding transfer pricing issues (e.g. Mutual Agreement Procedure)

4. Local taxes and duties consulting and compliance

We advise clients on planning transactions and/or business operations triggering local taxes and duties as well as support them in completion and filing relevant compliance documentation under the application legislation.

5.  Tax investment incentives

We support our clients in analysing tax incentives applicable to their business operations and obtaining advantages under beneficial tax and customs regimes. PwC assistance would include review of business model, products flow, documentation, and advice regarding available tax incentives and how to qualify for them. We will also support you in collecting and creating the required documentation.