Bulgaria (BG)
Bulgaria is the oldest state in Europe (founded 681 AD), a member of the European Union since 2007, and one of the most affordable countries for expats in the EU.
Retirement & Pension in Bulgaria
State pension, contribution refunds, private pension vehicles, and international agreements.
Bulgaria operates a three-pillar pension system. Pillar 1: State pension (НОИ — mandatory, pay-as-you-go). Pillar 2: Mandatory supplementary pension (ДЗПО — mandatory for workers born after 31 Dec 1959, invested in private pension funds). Pillar 3: Voluntary private pension (ДПФ — optional, with tax benefits). The state pension system is under demographic pressure due to population decline and emigration. Pensions are relatively low by EU standards but cost of living in Bulgaria is also much lower.
State Pension
The first pillar state pension is calculated based on a formula combining years of insurable service (осигурителен стаж) and the ratio of individual earnings to the national average insured income. For each year of service, 1.35% of the individual insured income is accrued (the accrual rate applying to new pension calculations in 2026). The individual coefficient compares your average insured earnings to the national average — higher earnings relative to the national average produce a higher pension. Pensions in payment are adjusted annually from 1 July under the Swiss Rule (50% inflation + 50% wage growth index): from 1 July 2026, pensions increased by 7.8%. The average pension in 2026 is approximately BGN 1,060/month (≈€541). Contact НОИ (noi.bg) for an individual pension estimate.
Men: 64 years 9 months in 2026 (increasing gradually to 65 by 2029). Women: 62 years 6 months in 2026 (increasing gradually to 65 by 2037 — rises by approximately 2 months per year). Minimum service years for full pension: Men: 40 years (target by 2027); Women: 36 years 10 months in 2026 (rising to 37 years by 2027). Earlier retirement possible with higher contribution years or in hazardous occupations.
Minimum to receive any state pension: 15 years of contributory service. Below this, entitled to social (minimum) pension. Voluntary continuation of contributions beyond retirement age can increase pension amount.
Use the НОИ online calculator at noi.bg. Enter your date of birth, contribution history, and salary data. The calculator provides an estimated pension amount. EU citizens can request a Statement of Contributory Periods (E205/P1) from НОИ showing Bulgarian contribution history for other EU country pension calculations.
Bulgarian state pension can be paid abroad. Contact НОИ to arrange international bank transfer. EU/EEA residents: Bulgarian pension paid without any deduction. Non-EU residents: may face withholding tax depending on double taxation agreements. Pension is taxable in Bulgaria at the flat 10% rate on amounts above the tax-free threshold.
Pension Contribution Refund on Leaving Bulgaria
Non-EU, non-EEA citizens who leave Bulgaria permanently and are not covered by a totalization agreement with Bulgaria. Must have at least 3 years of contribution history.
EU/EEA citizens: NOT eligible for contribution refund — contributions are credited toward Bulgarian pension entitlement or transferred under EU Regulation 883/2004. Citizens of countries with bilateral totalization agreements with Bulgaria. Bulgarian citizens.
No fixed statutory waiting period under Bulgarian law for the contribution refund itself — however, you must provide proof of permanent departure and the administrative process typically takes 3–6 months from application. Second pillar (ДЗПО) refunds follow the pension fund's own rules.
Employee contributions only (8.78% of insured salary for standard 3rd-category work). Employer contributions are NOT refunded. Second pillar (ДЗПО) contributions from private pension fund: separate refund process from the respective pension fund — contact your ДЗПО fund directly.
Apply to НОИ — submit application online at noi.bg or by post. Required: passport, proof of leaving Bulgaria, evidence of social insurance history, foreign bank account details. Second pillar refund: apply separately to your ДЗПО pension fund.
The refund process takes 3–6 months. Only the employee share is returned — the employer share remains in the system. For people who contributed significant sums, getting professional advice on whether remaining contributions toward a Bulgarian pension entitlement (rather than a refund) would be more beneficial is worthwhile.
International Totalization Agreements
Bulgaria has bilateral social security coordination under EU Regulation 883/2004 with all EU/EEA member states — contributory periods are aggregated. Bilateral agreements with: Turkey, North Macedonia, Serbia, Bosnia and Herzegovina, Montenegro, Russia, Belarus, Ukraine, Azerbaijan, Moldova, Armenia, Georgia, Israel (partial), Canada (partial). Agreements with most Western countries (USA, Australia, UK, NZ, Japan) are not in place — contributions there and in Bulgaria are generally independent.
Private Pension Vehicles
Mandatory Supplementary Pension Fund (2nd Pillar)
ДЗПО — Допълнително задължително пенсионно осигуряванеAll workers born after 31 December 1959 — mandatory
None — it is a mandatory contribution, not a subsidy
Contributions are excluded from personal income tax calculation
2.2% employee + 2.8% employer = 5% total of insured income (the UPF 5% is split from within the broader social insurance package — total pension contribution in 2026 is 8.78% employee + 8.22% employer for the state pension fund, plus the 5% UPF on top for workers born after 31 Dec 1959)
EU portability: contributions can be transferred within EU under bilateral pension agreements. On retirement: accumulated fund converts to supplementary pension payment. On leaving permanently (non-EU): refund possible from the pension fund.
Choose your ДЗПО fund carefully — returns vary significantly between funds. You can switch funds once per year. Licensed funds: Allianz Bulgaria, DSK-Rodina, Doverie, Lukoil Garant, Pension Fund "Future", CCB Group.
Voluntary Supplementary Pension (3rd Pillar)
ДПФ — Доброволен пенсионен фондAny individual who wants to save additionally for retirement — optional
None direct, but contributions are tax-deductible
Contributions up to 10% of taxable income are deductible from personal income tax (saves 10% × 10% = 1% of gross salary in taxes). Employer contributions to employee ДПФ (up to 60 BGN/month per employee) are exempt from social contributions.
No legal cap on contributions. Tax deduction capped at 10% of annual taxable income.
On leaving Bulgaria: refund of accumulated fund available (minus 10% withholding tax on gains). At retirement age: convert to supplementary pension payment.
Voluntary pension funds are a good tax-efficient savings vehicle for higher earners. Returns depend on fund performance. Compare funds on bulgariapension.bg or directly with providers.
Life Insurance with Investment Component
Застраховка "Живот" с инвестиционна компонентаIndividuals wanting insurance and investment in one product
None
Annual premium up to 10% of taxable income deductible from personal income tax
Tax deduction capped at 10% of annual taxable income
Policy can be maintained after leaving Bulgaria
Less commonly used than pension funds for retirement saving. Useful for those who also need life insurance coverage.
Early Retirement Options
Early retirement (по-ранно пенсиониране) available for certain categories: (1) Workers in hazardous conditions (special category professions): Men at 52, women at 47 years with 15+ years in category I conditions. (2) Military and security service: after 27+ years service. (3) Mine workers and similar categories. (4) From 2026: partial pension options are limited — early retirement before statutory age with full pension is very restricted compared to the pre-2012 system.
Pension Gap Warning
Average Bulgarian state pension in 2026: approximately BGN 1,060/month (≈€541) following the 7.8% July 2026 Swiss Rule increase. The minimum old-age pension (full insurance coverage) is approximately BGN 680/month. While these amounts can cover basic living costs in Bulgaria given the relatively low cost of living, they are significantly below the standard of living many expats expect. The 2nd pillar (ДЗПО) supplementary pension adds a meaningful but modest top-up for those born after 1959. Without voluntary additional savings (3rd pillar ДПФ, investments, property income), retirement income may be insufficient to maintain a comfortable lifestyle. Expats who have worked internationally should consolidate pension entitlements from all countries before retirement.
Useful Links
Retirement & Pension
Unlock the complete Retirement & Pension guide for Bulgaria — including every detail, document, tip and link you need.
Become a SupporterSupport the guide on Ko-fi · Unlocks every premium section, everywhere