🇧🇬 Bulgaria — Freelancer Social Insurance Cap in 2026

Yes — social and health contributions (27.8% combined: 14.8% DOO + 5% DZPO + 8% NZOK) are calculated on a monthly insurable base capped at 2,300 EUR/month from 1 August 2026. January–July used the previous 2,111.64 EUR cap, and the 2026 annual base blends both, so the cap is fully in force only once gross income clears both periods' ceilings:

Ordinary 25% category: the January–July ceiling is cleared at roughly 33,786 EUR/year; the base is fully capped only once the August–December ceiling is also cleared, at roughly 36,800 EUR/year.
40% category: the larger deduction means it takes more gross income to reach the same net-of-expenses figure, so the same two-step pattern happens later — the January–July ceiling clears at roughly 42,233 EUR/year, and the base is fully capped at roughly 46,000 EUR/year.

Above the applicable full-cap threshold, the base stops growing entirely — your social insurance bill is fixed no matter how much higher your income climbs. In between the two thresholds, only the August–December portion of the base is still rising with income, so contributions keep climbing, just more slowly.

What does that do to my marginal tax rate?

For the ordinary 25% category, once you're past the full-cap threshold (≈36,800 EUR/year), the marginal rate drops to 7.5%: each additional euro only generates the 10% income tax on 75% of it (after the 25% recognized-expenses deduction); social contributions add nothing further, since they're already capped. In the transitional band between ≈33,786 and ≈36,800 EUR/year, the marginal rate is higher, around 15.3%, since 5 of the 12 months are still climbing toward their cap.

75% taxable share×10% income tax=7.5% marginal rate above the cap

For the 40% category, the marginal rate above the full-cap threshold (≈46,000 EUR/year) is 6% instead — 10% income tax on the 60% of each additional euro left after the larger recognized-expenses deduction. The transitional band between ≈42,233 and ≈46,000 EUR/year sits at around 12.3%.

Does this mean my overall effective rate is 7.5%?

No — that's the marginal rate on income above the cap for the ordinary 25% category (6% for the 40% category), not your average rate on total income. Your actual average effective rate keeps falling as income rises but only approaches the marginal rate asymptotically; it never quite gets there, since the fixed social contribution is still part of the total. For the 25% category, at 40,000 EUR/year the average effective rate is roughly 24%; at 120,000 EUR it's around 13%.

See the full individual freelancer taxation guide for the complete calculation and worked examples.