If you have bought a property in Bulgaria as an investment in the past decade or so , you should be aware of the recent practices of the local councils to put unattended properties on actions. Find below the most common THREE WAYS you could lose your property if you are neglecting your investment in Bulgaria.
1. Unpaid council taxes
Many people think that once they have invested in Bulgarian property, there are no further obligations, besides the conveyancing costs. That is not correct. Each year, the owner of the property has to pay council tax and waste collection fee. If the property is uninhabited, the owner can apply to the local council and ask for waste collection fee relief. By doing so, you will benefit a significant reduction of the waste collection fee. This application has to be submitted every year, effective for the following year.
Council taxes are due every year and their amount depends on the location of the property and the tax valuation of the property (determined by the local council). Annual property council tax is different from the stamp duty, which the owner would have paid upon acquiring the ownership.
If you have not paid council tax, the council is likely to put your property on action and sell it in order to recover the outstanding property council tax and waste collection fees.
2. Missing final deadline for company re-registration
People who have bought their holiday home or rural property in Bulgaria before 01st January 2008 are likely to have used a limited company to buy their property. That was the period before Bulgaria entered the EU.
After the said date, Bulgaria introduced a centralised electronic Companies Register and all company owners should have re-registered their companies. This would have filtered all abandoned companies, as they would have been stricken out automatically.
However if the company was holding a property, such strike out can't happen. Therefore, the government extended the deadline for compulsory liquidation of all companies which hold properties and which have missed the deadline for re-registration. This new deadline is 31st December 2021. If you have a non-registered company which holds a property you need to put it into compulsory liquidation and either move the property to a new dormant company or sell the property. If you don't act now, you will lose the property after 31st December 2021.
Yes, you have only 6 months to take your Bulgarian property out of the stiken-off company or you could lose your investment for good!
3. Property scam
This case is not common but sometimes happens. If you have invested in property in Bulgaria but rarely visit it and you don't have someone to overlook it, you might become a victim of a perfectly legal way to lose your ownership. According to the Bulgarian Ownership Act:
Art. 79. The right of ownership of immovable property through prescription shall be acquired through continuous possession for 10 years.
In plain words, if someone uses or takes care of your property in Bulgaria for 10 continuous years, they have the legal right to claim the ownership. Usually scammers use this legal loophole and obtain legal ownership of properties, owned by Brits, who haven't visited their investment for years.
In order to avoid this happening, you need to undertake legal actions and interrupt any continued possession of the scammer. This would prevent the latter from using the said legal loophole.