In this article we talked to you about the advantages of living your retirement years in Bulgaria. Particularly pleasant climate, especially along the coast, cost of living equal to one fifth of the Italian one (which makes the allowance "virtually" 5 times "heavier") and then the low local taxation regardless of income (flat tax universal at 10%). On this issue there are often doubts on the part of many regarding the lawfulness of going to live in Bulgaria and continuing to collect the Italian pension, a lawfulness confirmed by many parties, so much so that there is talk of real migratory phenomena towards nations such as Bulgaria or even Portugal where those who have worked for forty years can enjoy their retirement while living with dignity thanks to the lower cost of living compared to Italy.
In support of those who have always believed that it is possible for those who take up residence in Bulgaria to enjoy the Italian pension, a ruling has arrived which further puts an end to the controversy.
It is sentence 12037 of 14 July 2023 of the Court of Cosenza, in a civil case between a citizen and the Revenue Agency.
Well according to this sentence it is confirmed that the pension treatment provided under the "private management" of the INPS is subject only to the tax levy of Bulgaria even in the presence of only "residence" in this nation.
Let's try to get into more specifics by first differentiating between residence and citizenship. Tax residency is an immediate process, that is, something that can be obtained in a few days by contacting an agency like ours. Citizenship, on the other hand, is a much longer and non-deterministic process. However, the thing that is always important to remember regarding residence and citizenship in Bulgaria is that for the purposes of joining the preferential taxation, only tax residence is necessary. Having said this premise, let us return to the provisions of the Court of Cosenza which ruled that on the basis of articles 16 and 17 of the Convention between the Italian Republic and the Republic of Bulgaria, a convention which was ratified at Italian level way back in 1990, if an Italian citizen takes up tax residence in Bulgaria and can receive the privately managed INPS pension by paying taxes only and exclusively in Bulgaria, and therefore with the aforementioned 10% flat tax.
In general, the advice we always give in these cases is the following: if you are retired and are considering moving to Bulgaria by taking up tax residence there to enjoy the Bulgarian tax advantages, before proceeding with any type of action, consult specialized agencies such as VR and Partners, who will be able to give you the directions and information to achieve your goal without risk of running into fines and legal disputes with the Italian authorities.
