Have you ever sold old clothes, phone or furniture through OLX, Facebook Marketplace or other online platforms? If so, you may have wondered if this is just getting rid of unwanted items or if it is actually an activity that you need to declare to the tax authorities.
The line between simply selling personal belongings and systematic trading is often unclear to many. In this article, we will explain in an understandable way when the NRA will treat your online sales as taxable activity and what your obligations are in such cases.
When is the sale of personal effects considered trading?
The NRA uses several key criteria to determine whether your sales are simply disposing of unwanted items or constitute taxable business activity.
Честота на продажбите
One-off sales: If you sell your old phone because you bought a new one, or sell off clothes you no longer wear, this is not considered business activity.
Systematic sales: if you sell different items every week or month and this continues over a longer period, the NRA may consider that you are doing business.
Example: Maria sells her old clothes and shoes twice a year – this is not a business. Ivan sells 5-10 pairs of sneakers every week, which he buys in bulk – this is a business.
Intention to profit
The key question here is: why are you selling?
Disposing of unwanted items: if you sell items that you have used but no longer need, this is usually not treated as business.
Targeted purchase for resale: If you are buying goods specifically to sell them at a higher price, this is a clear indicator of trading activity.
Example: Peter buys a new sink for the bathroom, but it doesn’t fit the dimensions and sells it on OLX – this is not business. Ana regularly buys cosmetics from abroad and resells them at a markup in Bulgaria – this is business activity.
Method of presentation of products
The NRA also pays attention to how you present your products:
Personal advertisements: Ordinary advertisements for sale without a special layout or advertising are most often not subject to the attention of the NRA.
Professional presentation: if you use professional photos, have a logo, company name or actively advertise your products, this can be considered a sign of business.
Example: an ad with a phone picture of an old sofa with the description “I am selling a used sofa in good condition” is not a signal that you are trading. Similar situation with professional product photos, logos and ads on different platforms – this is already a commercial activity.
How does the NRA track online sales?
The NRA is continuously improving its methods for monitoring internet trade. With the development of technology and digitalisation, tax authorities have more and more tools to detect unregistered business activity online. Here’s a more detailed look at the ways they can track your sales:
Online store or business profile
A digital presence created specifically for sales is the first and most obvious signal to the NRA. Taxpayers pay particular attention to:
- A registered domain with a commercial name – if you bought a domain like “MariaDresses.bg” or “IvanTechShop.com”, this clearly indicates commercial intent
- Professional logo and branding – using a unique logo, slogan or color scheme for your sales speaks of serious business intent
- Regularly update the assortment – if you publish new products every week or announce “new collections”, this is an indicator of systematic activity
- Structured product catalog – categories, subcategories and search filters are typical for online stores, not casual sellers
- Return and delivery policies – having formal policies for delivery, warranties or returns shows a professional approach
- Payment options – offering a variety of payment methods (cards, PayPal, cash on delivery) is characteristic of commercial activity
The National Revenue Agency often monitors for various indicators that may reveal the presence of business activity without the relevant registration or declaration of income. Among the main aspects they pay attention to are the creation and maintenance of business accounts on social networks, such as Facebook Business Page, Instagram Business profiles and LinkedIn Company pages. In addition, the use of online shopping features on Facebook and Instagram, including direct purchase buttons or integration with online stores, is observed. Particular attention is paid to the posting of prices, product availability and real-time updates, which can signal active commercial activity.
All of these factors help the NRA identify businesses or individuals who are making sales and services without adequate reporting.
Activity on more than one platform
Selling goods through different channels significantly increases the likelihood that your activity will attract the attention of the tax authorities. NRA analysis:
- Multiple profiles on listing platforms:
- Local: OLX, Bazar.bg, Alo.bg, marketplace.bg;
- International: eBay, Amazon, Etsy, AliExpress, Wish;
- Facebook Marketplace, Instagram Shopping, TikTok Shop.
- Complex presence:
- Own website + profiles on ad platforms;
- Online store + social selling.
- Consistency across platforms:
- Same products offered simultaneously in different locations;
- Similar descriptions and photos on different platforms;
- Links between different sales channels (e.g. “See our other products on Instagram”).
The NRA is able to establish links between different online platforms and profiles by analysing a number of common elements. Often, matching contact details such as phone numbers and email addresses that match between different accounts is used. Another indication is the use of the same username or similar presentation style, which allows identification of related profiles. Attention is also paid to the presence of references between different channels – for example, links from one social networking account to another. Additionally, the use of the same photos or visuals in different online spaces can be another indicator of connectivity between profiles or activities. By combining this data, the NRA effectively tracks and analyses commercial activity on the internet.
Use of advertising and marketing strategies
Investing in advertising is one of the strongest indicators of commercial activity. The NRA can monitor:
- Paid digital ads:
- Facebook and Instagram Ads – especially when targeting sales or traffic
- Google Ads and Search Engine Ads
- YouTube ads and video content
- Banner ads on other websites
- Specific marketing messages:
- “A new collection every week”
- “Limited quantities”
- “Discounts up to -50%”
- “Free delivery on orders over 50 BGN”
- Partnerships and collaborations:
- Working with influencers to promote products
- Sharing promotional codes via third parties
- Participation in affiliate programs
Volume and frequency of transactions
The National Revenue Agency can analyse the pattern of your transactions to determine whether you are trading. One of the key elements of this analysis is the regularity of sales. The NRA looks at frequency such as daily or weekly sales, as well as having a steady stream of orders rather than single or occasional sales. Seasonal spikes in activity, typical of certain businesses, can also signal organized business activity.
Another important aspect is the volume of transactions. If there are a large number of sales in a short period or a significant turnover that exceeds the usual turnover for so-called “casual sales”, this may trigger additional interest from the tax agency. A steadily increasing volume of sales is also an indication of the development of commercial activity.
Financial footprints are another key indicator. Regular incoming payments from platforms such as PayPal, Stripe or ePay, as well as frequent transfers from various customers, clearly outline a pattern of active business activity. Furthermore, the use of POS terminals or virtual POS solutions further reinforces the impression of organised sales activity. All of these factors combine to give the NRA a clear picture of the nature and scope of your financial activity.
Methods for tracking and cooperation between institutions
The NRA has various methods of collecting information:
- Cross-checks:
- Comparing declared income with visible online activity;
- Checking bank transactions against online sales.
- Cooperation with other institutions:
- Exchange of information with banks and payment operators;
- Cooperation with big platforms like Amazon, eBay;
- Using data from international tax offices for cross-border trade.
- Technological means:
- Automated online activity monitoring systems;
- Analyzing large datasets (big data) to discover patterns of commercial activity;
- Track digital footprints and connections between different online profiles.
What are the tax obligations if your online sales are considered trading?
If the NRA determines that your sales constitute business activity, you will have the following obligations:
Taxation
Profit tax: you have to pay 15% tax on the profit from sales (not on the entire income) if you are not a registered trader but only use your name for sales.
How to calculate: subtract the cost of purchasing goods, advertising, shipping, etc. from the total revenue. Tax is calculated on the remaining amount.
Example: if during the year you have sold goods for 20 000 BGN, but you have spent 12 000 BGN for their purchase and 3000 BGN for advertising and delivery, your profit is 5000 BGN. You owe tax of £750 (15% of £5,000).
Insurance contributions
As a person doing business, you have to pay:
As a person doing business, you have to pay: Health insurance contributions: you pay them monthly on a minimum insurance income of 1077 BGN (for 2025).
Pension contributions: these are also calculated on the basis of the minimum insurable income.
Pension contributions: they also apply Important: Even if your profit is small or you have no profit, you still owe contributions on the minimum insurance income!calculated on the basis of the minimum insurance income.
VAT registration (for higher turnovers)
Threshold for compulsory registration: if your income exceeds 100 000 BGN for 12 consecutive months, you must register for VAT.
What this means: you will have to charge 20% VAT on sales and submit monthly returns.
More information can be found HERE. If you need further help or clarification on your tax obligations, do not hesitate to contact a qualified accountant or tax advisor, as you will find at ATP Consult.
What are the consequences if you do not comply with your tax obligations?
The NRA can impose serious penalties if it finds that you are running an unregistered business:
Tax penalties
- If you fail to file a tax return within the established deadlines, the fine is up to BGN 500 and up to BGN 1,000 in case of a repeat offence.
- In case of submission of false data leading to lower tax or non-payment, the fine is up to BGN 1,000, and in case of repeated offence – up to BGN 2,000.
More information can be found HERE.
Consequences of failure to register for VAT
- Pursuant to Article 178 of the VAT Act, if a person who is obliged to register for VAT does not submit an application for registration within the established deadline, he shall be punished with a fine – for natural persons who are not traders, or with a pecuniary sanction – for legal persons and sole traders, in the amount from BGN 500 to BGN 5000.
It is advisable to consult official sources or a tax professional for up-to-date and accurate information on penalties for unregistered business activities.
How to protect yourself from problems with the tax administration?
To avoid unpleasant surprises, follow these recommendations:
Keep records
Even if you sell occasionally, it’s okay to:
- Keep purchase documents for the goods you sell
- Record how much you sold and at what price
- Keep evidence of sales-related expenses
Consult an expert
If you have any doubts about whether your activity is considered a business:
- Seek advice from an accountant or tax adviser
- Ask your local tax office
- Know the current legislation
Register on time
If your online sales do fall into the “marketing” category:
- Register as self-employed
- Pay taxes and social security regularly
- If necessary, register for VAT
Conclusion
The casual sale of personal property is not usually of interest to the NRA. But if your sales are regular, you intend to make a profit, and you act professionally as a trader, you are probably carrying on a taxable business.
Remember that tax authorities are becoming increasingly adept at doing their job of tracking online transactions and distinguishing between single sales and systematic trading. Need advice for your ecommerce? Contact us for a consultation.