As part of our Company’s commitment to keeping you informed, we would like to inform you on the reduction of tax on distributed dividends.
In particular:
By virtue of Article 65(1) of Law 4603/2019 (Government Gazette, Series I, No. 49), the dividend tax rate dropped from 15% to 10%. Similarly, the tax withholding rate on dividends was set at 10% instead of 15% as previously in force.
Pursuant to the provisions of paragraph 3 of this Article, the new tax rates shall apply for all income received during tax years starting from 01.01.2019 onwards.
Reduced tax rates shall apply to:
a) income distributed by Sociétés Αnonymes, Limited Liability Companies and Private Companies, for which the relevant distribution approval decision (for the current or previous tax years) was made by the competent body of the legal person from 01.01.2019 onwards.
If Sociétés Anonymes have distributed interim dividends or Limited Liability Companies or Private Companies have proceeded to temporary withdrawals instead of profits during tax year 2018, on which a 15% withholding tax rate has been applied, given that such distribution decision is subject to the approval of the Ordinary General Meeting of Shareholders or Partners respectively, which will take place during tax year 2019, the new reduced 10% tax rate shall apply.
b) For income from foreign dividends, the reduced 10% tax rate shall apply when the right of collection thereof (e.g. decision made by the competent body) was obtained after 01.01.2019, and even when this date is not easily identifiable, when their payment to the beneficiary, through bank account credit or otherwise, takes place after 01.01.2019.
Finally, in case that, until Law 4603/2019 reducing tax rates was published on 14.03.2019, the 15% tax rate (instead of the reduced 10% rate) has been applied, the 5% additional tax shall be returned as an unduly paid amount.
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.