Bank reconciliation in Bulgaria: steps and checklist

Bank reconciliation is the check that the books and the bank show the same money. For each bank account, the book balance is compared with the closing balance on the statement, and every statement line is linked to the document that explains it: a sales invoice, an expense, payroll, a tax, a loan or a fee. When both sides agree, receivables and payables are right, returns are filed from accurate figures, and wrong or unidentified payments are caught in time.

What bank reconciliation covers

Bank reconciliation has three parts:

• 01Balance: the book balance of the account, for example 503, equals the closing balance on the statement at the same date.
• 02Matching lines: every statement line is linked to a document. A customer receipt settles an invoice, a supplier payment settles an expense, a payment to the tax agency settles a declared liability.
• 03Open items: customer and supplier balances agree with unpaid invoices. A customer with a balance in its favour means an overpayment or an advance; a supplier with a balance in your favour means an advance you paid.

Why it is required in practice

The Accountancy Act does not use the word "reconciliation", but the requirements for the books lead to it:

• 01All business transactions that change the company's property and financial position, results, cash flows and equity are recorded in chronological order (Art. 3, para. 2 of the Accountancy Act, ЗСч) and on a documented basis (Art. 3, para. 3).
• 02Recording fictitious or insufficiently identified transactions is not allowed (Art. 9, item 2 of the Accountancy Act, as amended in State Gazette No. 61 of 2025). A receipt whose payer is unknown is not recorded as revenue.
• 03Companies with net sales above BGN 200,000 (€102,258.38) carry out a stocktake at least once a year (Art. 28 of the Accountancy Act), and it covers cash at bank.
• 04Expenses for income of resident individuals unpaid at 31 December are deductible for tax in the year of payment, with the exceptions in Art. 42, para. 2 of the Corporate Income Tax Act, such as basic salary. Reconciliation shows what is unpaid.
• 05An advance received makes VAT chargeable on receipt and requires an invoice within 5 days (Art. 25, para. 7 and Art. 113, para. 4 of the VAT Act). An unrecognised advance easily leads to a late invoice.
• 06A wrongly executed or unauthorised transfer is corrected only if you notify the bank without undue delay and no later than 13 months from the date the account was debited (Art. 77 of the Payment Services and Payment Systems Act). Business clients may have agreed a different, usually shorter period (Art. 67, para. 4).

How to reconcile the bank

Reconcile each bank account separately, ideally every month:

• 011. Gather the statements for all accounts for the period. Each statement's opening balance must equal the previous closing balance.
• 022. Match customer receipts with their invoices and supplier payments with their expense documents. The invoice number in the payment reference, the amount, and the counterparty's ЕИК and IBAN are the strongest signals.
• 033. Match salaries, social contributions and taxes with the month's payroll and returns.
• 044. Record the lines that originate with the bank: fees, interest, returned transfers.
• 055. Post unidentified receipts to a suspense account, such as 499, and identify the payer. Do not recognise them as revenue.
• 066. Compare the book balance of each account with the closing balance on the statement. There should be no difference.
• 077. Review customers with balances in their favour and suppliers with balances in yours: for overpayments you refund the money or issue an advance invoice.
• 088. Revalue accounts in currencies other than the euro at the rate at the end of the period. Standard 21 requires this at the reporting date; monthly revaluation is practice.

Example: reconciling September 2026

Primer OOD has one account in euro. The statement's closing balance at 30 September 2026 is €15,761.35, and the book balance of account 503 is €15,468.00. The reconciliation finds three lines that were not posted:

The account is reconciled, but the work is not done: €300.00 sits on account 499 until you identify the payer. If it turns out to be an advance, its invoice must be issued within 5 days of receipt. The account numbers come from the commonly used chart; each company applies its own individual chart of accounts (Art. 11, para. 1, item 5 of the Accountancy Act). How each kind of statement line is posted is covered in how to book a bank statement.

Common differences and how to resolve them

Most reconciliation differences are of a few kinds:

Paying the tax agency in 2026

Since 2 October 2023, taxes and social contributions are paid to national accounts of the National Revenue Agency (NRA, НАП) at the Bulgarian National Bank, one for each type of obligation. Payments are in euro. The accounts a typical small company uses are:

• 01The "payment type code" field is not filled in for transfers to the NRA. You enter one identifier of the person liable: ЕИК, ЕГН or ЛНЧ.
• 02The account decides the type of obligation. Within a type, and until enforcement starts, the amount received settles the obligation with the earliest due date at the payment date, and interest only after all principal (Art. 169, paras. 4-6 of the Tax and Social Insurance Procedure Code). So a VAT payment to the taxes account can settle an older corporate tax advance.
• 03An amount paid to the account for a different type of obligation settles an obligation of that other type, if there is one; otherwise it is an overpayment, which the agency offsets against other debts. The error is fixed with a request for offset or refund (Arts. 128 and 129 of the Code).
• 04Tax counts as paid on the date the amount reaches the NRA account (Art. 89, para. 3 of the VAT Act), so do not send the transfer on the last day.
• 05VAT is paid by the 14th, and social contributions and wage tax by the 25th of the following month.

The cash payment limit

Payments of BGN 10,000 or more, €5,112.92 at the fixed rate, cannot be made in cash: they are made only by transfer or deposit to a payment account (Art. 3, para. 1 of the Act on Limiting Cash Payments, ЗОПБ). The rule also covers several smaller payments linked on the same ground that together reach the limit. Dividends of BGN 1,000 (€511.29) or more are also paid by bank. The Act does not apply to withdrawing or depositing cash from or to your own payment account (Art. 2, item 1). The penalty is 25% of the payment for individuals and 50% for legal entities (Art. 5). The EU-wide €10,000 cap that applies from 10 July 2027 does not replace Bulgaria's lower limit.

Verification of Payee from 2027

By 1 January 2027 at the latest, payment service providers in Bulgaria check, before you send a euro transfer, whether the payee's name matches its IBAN, and tell you whether it matches, nearly matches or does not match. The service is free (Regulation (EU) 2024/886). For reconciliation this means fewer misdirected transfers; for invoices, that the company name and IBAN must be exact. More in Verification of Payee in Bulgaria.

Monthly checklist

Common mistakes

• 01Recognising an unidentified receipt as revenue. It stays on a suspense account until you identify the payer (Art. 9, item 2 of the Accountancy Act).
• 02Recording a Stripe, PayPal or card payout at the net amount. Revenue and the fee are recorded separately (Art. 26, para. 1, item 7 of the Accountancy Act).
• 03Filling in a payment type code, or paying to the old accounts of the regional directorates. Since October 2023 the accounts are national and the code is not filled in.
• 04Expecting the tax agency to settle exactly the obligation you had in mind. Within a type, the obligation with the earliest due date is settled (Art. 169, para. 5 of the Code).
• 05Keeping the euro account as a foreign-currency account. Since 1 January 2026 the euro is the national currency, and a euro account creates no exchange differences.
• 06Leaving reconciliation to year-end. A wrong transfer must be disputed in time, and an unrecognised advance leads to a late invoice.

In smetni.app

In the Bank module (Business plan) you upload bank statements as PDF files with opening and closing balances. The app reads the lines and saves a statement only if the opening balance plus receipts minus payments gives the closing balance, and warns you about missing days and an opening balance that differs from the previous closing. In the "Matching" tab it suggests documents for the lines where it finds a match and shows why: the number is in the memo, the amount covers the remainder, the account is known, the name is similar or the EIK is in the memo. You confirm the link; a document is linked automatically only at a 100% score, if an admin turns on "Auto-apply at 100%", and reconciliation rules can also place lines automatically. Partial payments, one payment for several invoices of one customer or supplier, and several transfers for one invoice are supported. When a receipt is larger than the invoice, the invoice takes only what it owes, and the rest stays open on the line until you place it explicitly, for example as a customer credit. Lines for tax payments, salaries, transfers between own accounts and dismissed lines are marked too. With accounting enabled, confirmed payments of invoices and expenses are posted (Dr 503 / Cr 411 or Dr 401 / Cr 503), but salaries, taxes and transfers between own accounts are not posted automatically. There is no bank connection: statements are uploaded by hand. If you reconcile the bank for several companies, see smetni.app for accounting firms. See the guides to bank and the monthly close, and plans and pricing.