According to the Greek Tax Law 4172 / 2013 for individuals, who wish to transfer their tax residence in Greece:

Art. 5A: Alternative taxation until 15 years, was introduced for the income of individuals, who transfer their tax residence in Greece, provided, that they make an investment in Greece.

Art. 5B: Alternative taxation was extended until 15 years, for foreign pensions’ beneficiaries, who transfer their tax residence in Greece.

Art. 5C: 50% exception from the income tax and special solidarity contribution until 7 years, was established for individuals, who transfer their tax residence provided, that they get a new job, or start a new business activity.

Art. 71H: Clear and transparent rules were adopted regarding the establishment and operation of family offices and the management of the cash - flow and family property of individuals, having tax residence in Greece.

5A FOR INVESTORS – Tax Treatment and Benefits

• Annual payment of flat-rate tax of € 100.000,00, which covers the tax liability for all foreign incomes (without obligation to be declared).

• Taxation with general provisions and obligation to declare the Greek income by submitting an annual income tax return.

• Possibility of extension to other family members by annual payment of additional flat-rate tax of € 20.000,00 per family member.

• Exemption from any inheritance tax and property donations located abroad.

• No obligation to justify the imported foreign exchange.    

5A FOR INVESTORS – Two Conditions

The individual:

• Should not have been a tax resident of Greece for the last 7 out of 8 years.
• Should prove, that he / she invests in Greece, at least, the amount of € 500.000 in real estate or companies or securities or shares or stakes in companies, based in Greece within 3 years.

or the individual should have acquired and should maintain a residence permit for investment activity in Greece (Golden Visa).

5B FOR PENSIONERS – Tax Treatment and Benefits

• Annual tax payment with 7% rate, separately for the total income, which was acquired abroad.
• Obligation to declare all income’s categories, both Greek and foreign, by submitting an annual tax income return.
• Taxation with general provisions of the domestic income (which arises in Greece).

5B FOR PENSIONERS – Three Conditions

The individual:

• Should be a beneficiary of income, earned from pension, in the foreign country.
• Should not be a tax resident in Greece for the last 5 out of 6 years.
• Should transfer his / her tax residence from a State, with which an administrative cooperation agreement, is in force, in the field of taxation in Greece.

5C FOR EMPLOYEES AND FREELANCERS – Tax Treatment and Benefits

• Exception from the income tax and special solidarity contribution for the 50% of income, earned from the salaried employment, arising in Greece, for new tax residents.
• The same tax treatment is applicable for the provision of independent services to all new tax residents, who start their business activity in Greece (freelancers or entrepreneurs).
• Annual objective expenditure is not applicable for residence and private passenger car of private use.

5C FOR EMPLOYEES AND FREELANCERS – Four Conditions

The individual:

• Should not have been a tax resident in Greece for the last 5 out of 6 years.
• Should transfer his / her tax residence from a Member State of EU or European Economic Area (ΕΕΑ), or a State, with which an administrative cooperation agreement, is in force, in the field of taxation in Greece.
• Should provide services in Greece, by working at a new position (either at a domestic legal person / entity or to a permanent establishment of a foreign entity in Greece).
• Should declare, that he / she will remain in Greece for at least 2 years.

71H FAMILY OFFICES – Conditions - Operation - Purpose

Establishment Conditions

The Family Office should:

• Employ a personnel of at least 5 persons in Greece within 12 months from its establishment.
• Annually carry out at least € 1.000.000 costs for operation.

Family Office’s Operation in Greece

In any legal form (SA / Ltd / Partnership), except from a non - profit legal entity.

Exclusive Purpose

Providing support to individuals, who are tax residents in Greece, and to their family members, while administrating and managing their assets and investments.

71H FAMILY OFFICES – Tax Treatment and Benefits

1. Specification of taxable income using OECD’s cost plus method - CPM, applying profit rate OF 7% on total expenses of any kind and their depreciations, except from the income tax.
2. All costs to which the fixed profit rate is applied, will be deducted, only if they are proven by documents, as the Greek legislation provides for.
3. Implementation of the predicted corporate tax rate 22%, from the tax year 2021 and onwards.
4. Withholding tax for the payments, which will be executed, according to general provisions.
5. VAT: the internal actions, which are performed between FO and persons, who participate in FO, as actions, which are carried out within a single entity, are outside the VAT - scope of implementation.

Source: Greek Ministry of Finance

NOTE: This article does not cover advisory, but only informational purposes, and cannot serve, as a basis for further actions, on the part of the reader.
Reception of specialized advice is required.
Our company does not hold any responsibility for any actions, taken by the readers, based on the present article.

Within the framework of your information from our Company, we would like to make reference to the following information regarding the new institution of the Out – of - Court Settlement of Tax Differences. 

In particular, the Article 16 of the voted Law 4714 / 2020 entitled “Tax interventions to strengthen the development process of the Greek economy” provides for the establishment of an Out – of - Court Settlement Committee for outstanding tax cases.

By the Decision No. 127519 ΕX 2020 of the Ministry of Finance (Government Gazette Β΄4939 / 09.11.2020), a Committee, based in Athens, was put into operation as well as a corresponding Branch in Thessaloniki, specifying, at the same time, the way of operation, the out – of - court settlement process, the organizational structure, the way of submitting the application, as well as the supporting documents that must accompany it.

The task of the Committee is “the out – of -court settlement of the outstanding tax differences before the Council of State and the regular Administrative Courts”.

In this way, judicial decongestion will also be achieved.

The Out – of - Court Settlement Committee for tax differences, is divided into four (4) three-member chambers for Athens and two (2) three-member chambers for Thessaloniki. The composition of the chambers will ensure functional independence, since it will be chaired by a former judicial officer at the rank of at least the President of the Court of Appeals, who will be accompanied by one former judicial officer and by one member of the State Legal Council. The rapporteurs of the cases will be two (2) tax officials. These shall be led by a superior, bearing the title of a former member of the Council of State or a former President of the Court of Appeals.

Therefore, the judgment on the cases, which will be decided, shall be based on judicial officials, who have sufficient, scientific guarantees to complete these cases.

Procedure and scope of inclusion in the Committee's area of regulation

The taxpayer party shall submit an electronic application to the website www.eefdd.gr until 31.12.2020, for the settlement, before the Council of State and the regular courts, of any outstanding differences from the imposition of taxes and fines. It is a necessary condition, that these outstanding tax differences have not been discussed until 31.10.2020, and that, the submitted application has borne the signature of a Lawyer.

The application must state the allegations of the party, as they have been included in the judicial document of the already pending trial. Otherwise, it is presumed, that they have not been legally promoted and are not taken into account by the Committee. These allegations are the followings:

• Limitation of the right of the State to impose the disputed tax, due to the expiration of the period of carrying out a tax audit,

• Limitation of the right of the State to impose the disputed tax, due to obtaining a tax certificate without reservation,

• Incorrect imputation of the tax, due to an obvious lack of tax liability or numerical error,

• Retroactive implementation of the most favorable tax sanction, and finally,

• Reduction of the additional tax, interestώ, surcharges and fines.

These supporting documents are also submitted electronically, constituting an integral part of the submitted application, no later than 31.12.2020. The failure to submit these documents results in the invalidity of the application.

It is noted, that the trial to be held is suspended, for as long as the case is pending before the Committee. The suspension does not cover the temporary judicial protection.

How the Committee decides

The Committee, based on case – law criteria, proposes the full or partial acceptance of the requests of the application or their rejection, submitting a clear and specific proposal to the applicant in accordance with the provisions of Article 5 of the Code of Tax Procedure. If the applicant accepts the proposal, an out – of - court settlement protocol is drawn up, is published on the Committee's website and is confirmed by the authenticity of the signature of the applicant, who owes his / her universal and unconditional acceptance of this report. Partial acceptance is not allowed.

In this way, the tax difference is finally and irrevocably resolved, without any objection to it and by any legal means. In this case, within five (5) working days from the signing of the out – of - court settlement protocol, 30% of the main tax of the new debt must be paid and the remaining tax shall be paid in the monthly installments, provided by law.

In case of non - fulfillment of the above conditions, the compromise is overturned retroactively, while the amounts paid until then, are considered as part of the initial debt.

Finally, it should be noted, that the case returns to the court stage, provided that:

• It was not examined until 28.05.2021. So, its tacit rejection is presumed, and

• If the proposal of the Commission is not accepted by the applicant.

NOTE: This article does not cover advisory, but only informational purposes, and cannot serve, as a basis for further actions, on the part of the reader.
Reception of specialized advice is required.

Our company does not hold any responsibility for any actions, taken by the readers, based on the present article.

The Article 4 of the Tax Bill of the Ministry of Finance entitled “Tax Reform with development dimension for tomorrow's Greece”, voted on 06.12.2019, includes a provision, which changes the way of taxation of the benefit in kind with the form of a business vehicle, from 01.01.2020.

In particular, the value of granting a vehicle to an employee or partner or shareholder by an individual or legal person or legal entity, and for any period of time within the tax year, is calculated on a scale as a percentage of the Retail Price Before Taxes (LTPF) of the vehicle. Analytically:

For LTPF up to € 14.000,00, the calculation rate amounts to 4% and the resulting amount is counted as an additional, annual income.

For LTPF from € 14.001,00 – € 17.000,00, the calculation rate amounts to 20% and the resulting amount is counted, as an additional, annual income.

For LTPF from € 17.001,00 – € 20.000,00, the calculation rate amounts to 33% and the resulting amount is counted as an additional, annual income.

For LTPF from € 20.001,00 – € 25.000,00, the calculation rate amounts to 35% and the resulting amount is counted as an additional, annual income.

For LTPF from € 25.001,00 – € 30.000,00, the calculation rate amounts to 37% and the resulting amount is counted as an additional, annual income.

For LTPF more than € 30.001,00, the calculation rate amounts to 20% and the resulting amount is counted as an additional, annual income.

The value of the vehicle’s granting resulting from the above scale, is reduced by 10% for vehicles aged 3 - 5 years, by 25% for vehicles aged 6 - 9 years, and by 50% for vehicles of more than 10 years. For vehicles of up to 2 years’ oldness, no reduction is foreseen.

Indicatively and based on the aforementioned, for the granting of a vehicle throughout the year, of LTPF of € 18.000,00 and of 5 years’ oldness, there will be a benefit in kind, amounting to € 1.490,00 - € 149,00 = € 1.341,00. It should be noted, that the above percentage of each vehicle is not shared to more than one person.

Excluded from the above provisions, are the vehicles, which are granted exclusively for business purposes and have a LTPF of up to € 17.000,00. This category includes vehicles provided to salespeople, technicians and other employees, whose work requires daily commuting, outside the company’s premises.

NOTE: This article does not cover advisory, but only informational purposes, and cannot serve, as a basis for further actions, on the part of the reader.
Reception of specialized advice is required.

Our company does not hold any responsibility for any actions, taken by the readers, based on the present article.

A new paragraph was added to Article 5B of the current Law on income tax (Law 4172 / 2013), concerning the possibility of alternative income taxation of individuals, beneficiaries of pensions of foreign origin. More specifically:

It is possible for the individuals, beneficiaries of pension of foreign origin, to be subject to an alternative taxation of their total income from abroad in Greece, under particularly favourable terms.

For this to happen, they will have to transfer their tax residence to Greece.

For this transfer, the foreigners must meet the following two conditions. In particular:

• They must not have been tax residents of Greece for five (5) years from the previous six (6) years of their taxation, and

• There must be a transnational agreement of administrative cooperation in the tax sector (Treaty of Avoidance of Double Taxation) in place, between the State of origin and Greece.

If the above two conditions are met, the foreign pensioner must submit a relevant Application until 31^st of March of each tax year, to the competent tax authority of our country, by submitting, at the same time, a document from the foreign social security organization or other public authority of his / her country, certifying his / her status as a foreign pensioner and the payment of a relevant pension.

In the relevant application, the foreign pensioner shall also state the State, in which he / she maintains his / her tax residence.

The competent Tax Administration of Greece shall examine the request of the foreign pensioner and within sixty (60) days, shall issue a relevant decision, by which it accepts or rejects his / her relevant application. In case of acceptance of his / her request, the Greek Tax Administration shall inform the Tax Authority of the State of the foreign pensioner about the transfer of his / her tax residence in Greece.

It should be noted, that the period of inclusion in the alternative taxation starts from the tax year following that, in which the application was submitted and lasts for the next fifteen (15) years.

In this case, a tax is charged on the total income of the pensioner from any source (pensions, rents, interests), calculated at a rate of 7%.

This income is exempt from the taxation of the special solidarity contribution.

Any income tax, which will have been paid abroad for any of his / her income, is deducted in full, but cannot exceed the corresponding tax for this income in Greece. Any excess tax is non - refundable.

The relevant tax is paid at once, in one installment, until the last working day of the month July of each year. By the payment of the tax, the pensioner will be subject to no other tax obligations in respect of these incomes.

Additionally, it should be noted, that the individual, who transfers his / her tax residence in Greece, but while maintaining immovable property abroad, is not exempt from paying taxes of inheritance or donations abroad, which are related to his / her immovable property.

Finally, the taxpayer may, if he / she so wishes, revoke in the next tax years, his / her inclusion in the alternative taxation in Greece.

NOTE: This article does not cover advisory, but only informational purposes, and cannot serve, as a basis for further actions, on the part of the reader.
Reception of specialized advice is required.

Our company does not hold any responsibility for any actions, taken by the readers, based on the present article.