According to the Law 4387 / 2016 (Government Gazette A85 / 12.05.2016), which has been recently released by the Greek Parliament, changes have been made in the income taxation of both, natural and legal persons. Specifically:

• According to Article 112, for income  obtained in the fiscal year 2016 and onwards, the taxation rates for employees and pensioners have been amended in accordance to the following scale: 

In the two new first scales the tax liability becomes lighter, while the last two rates increase resulting in the proportional burden on income amounts over € 30.001,00.

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From the 01.06.2016, the normal VAT rate of 23% will become 24%, upon release of the corresponding measure through the Greek parliament.

Moreover, from 01.06.2016, the VAT rates on the following islands, are going to become equal to the VAT rates on the rest of Greece, that means that, the normal  rate will become 24%, the reduced  becomes 13% and the highly reduced will become 6%.

These increases apply to the following islands: Syros Thassos Andros, Tinos, Karpathos, Milos, Skyros, Alonissos, Kea, Antiparos and Sifnos.

The  reduced by 30% rates applicable at the Aegean islands (which continue to apply reduced rates) have been defined as follows : 17%, 9% and 4%.

These rates will apply until 01.01.2017 on the following islands:

The prefectures Lesbos, Chios, Samos, the Dodecanese except Rhodes und Karpathos, the Cyclades except Syros, Naxos, Andros, Paros, Tinos, Milos, Mykonos, Kea,  Santorini / Thira,  Sifnos  and  Antiparos, the island Samothraki and the north Sporades except  Skiathos, Alonnisos and Skiros.

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.

According to article 42 of the aforementioned Law it is defined that:

• If the taxpayer is entitled to an income tax return, the Tax Authority, after setting off the due taxes from the taxpayer with the amount to be reimbursed, shall proceed to the return of any resulting dispute.

• The refundable amount is paid to the taxpayer within ninety (90) days from the submission of the relevant written request, unless a shorter period is provided by another provision of the tax law.

• In a written statement of the taxpayer, which is included in the request for the return, the refundable amount may be deducted ("stored") from the Tax Authority, in order to be credited against future liabilities of the taxpayer.

• The claim for a tax refund which was paid unduly shall fall under the statute of limitations at the time, during which the right of the Tax Authority to issue a tax assessment act shall fall also under the statute of limitation, in accordance with the provisions of paragraphs 1 and 2 of Article 36 of the Income Tax Code regarding the corresponding tax liability, from which the claim of the taxpayer for a return arises.

Further, the article 36, paragraph 1 of the aforementioned Law defines that:

• The Tax Administration may undertake the issuance of an administrative act of an estimated or corrective determination within five (5) years from the end of the relevant tax year.

According to the above, when we have cases where the taxpayer has paid an advance or a greater amount of tax that he should, is he entitled to receive the money from the Tax Administration.

The limitation of the claim of the taxpayer against the State occurs within five (5) years from the end of the year in which the deadline for the submission of the tax return expired.

The aforementioned apply for tax matters, which will occur from the date into force of the provisions of Law. 4174/2013, ie cases from 1.1.2014 onwards.

For tax matters, which have emerged until the 31.12.2013, that means in a period where the Law. 4174/2013 was not in force, the period of limitation for a tax refund claim against the State is defined by Article 84 of the coded Law 2238/1994 and it is three years from the date of the on time submission of the relevant tax return, or if it had been submitted late, after three years from the last date on which it should have been submitted in order to be considered as timely.

The tax reimbursement process which is followed by the Tax Administration is defined by the ministerial decisions POL 1287/2013 and POL 1183/2014. In particular, the implementation of the refund shall be effected on the basis of the timing of the submission of the income tax return.

In regards to income tax returns which have been submitted until the  31/12/2013, the tax refund,  including the reimbursement / setting off of those cases where an audit is not required, shall be made within thirty (30) days of receipt of the relevant file.

The tax authority is obliged to undertake a partial audit, if this is required and to complete the reimbursement or the setting off process within sixty (60) days including the reimbursement / setting off from the date the audit instruction was issued.

In cases in which from the above mentioned audit the conclusion is that full audit is necessary, this audit has to be completed including the reimbursement / setting off within four (4) months from the date the relevant audit instruction has been issued

Regarding the income tax returns which have been submitted from the 01.01.2014 onwards the tax authority is obliged to pay to the beneficiaries, within ninety (90) days from the submission day of the written request, the amount that remains to be reimbursed after the performance of any eventually setting offs of with certified debts of the taxpayers to the tax administration.

The request includes any written declaration of setting off of the refundable amount with future debts.

In case the IBAN of the bank account of the taxpayer has not been mentioned on the return request, immediately after the tax return calculation the beneficiary receives a notification.

Otherwise, the refundable amount has to be transferred to the bank account of the beneficiary directly.

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 optional insurance gives the opportunity to the persons who were insured at IKA or any with IKA merged insurance funds, to continue their insurance by paying the relevant contribution, if for some reason they are not in a working relation any more.

The conditions that must be met in order to join an optional insurance are the following:

OLD INSURED

Definition:  All individuals who have been mandatorily insured in any main insurance fund until 31.12.1992.

• Interruption of the insurance
• Fulfillment of minimum five hundred (500) working days within the previous five (5) years or three thousand (3.000) working days from the commencement date of the insurance.
• Absence of pensionable disability
• Existence of application for inclusion by the person concerned

The optional insurance may be done for one or more sectors from the ones the person concerned was insured at IKA while being in a dependent working relationship.

Optional insurance is carried out for 25 days of insurance per month and 300 per year and it is not possible to accede to this institution for a reduced number of days each year (100, 120 etc.), in order to fulfill the conditions for receiving sickness benefits by the fund.

The contributions which the insured person is obliged to pay per month, correspond to the sum of all employer and employee contributions and are calculated on the basis of the imputed wage of the insurance class within the remuneration received by the employee on the day of the employment interruption, and which shall be not less than 25 times the imputed wage of an unskilled worker (Article 10 of Law 2217/1994, 45/2007 Circular IKA and IKA Document A23 / 590/11 / 25.05.2012).

NEW INSURED

Definition: All individuals who have been insured in the mandatory insurance of any fund the first time from 01.01.1993.

• Fulfillment of 1.500 working days minimum, from which the 300 days within the last five years preceding the application
• Not to belong to another primary insurance fund
• Not to belong to any other insurance fund

The optional insurance may be done for one or more sectors of those of which the person concerned was insured at IKA while being in a dependent working relationship. The contributions which the insured person is obliged to pay per month, correspond to all employer and employee contributions and are calculated on the average of the salary of the last 12 months before the interruption (IKA Document A23 / 540 / 2.6.2006, A23 / 590 / 15.6.2007).

LONGTERM UNEMPLOYED

The long-term unemployed, insured at IKA, who in order to receive a full pension, miss up to five years, can optionally continue their insurance with payment of contributions from the public Employment Agency (OAED) (Article 10 of Law 2874/2000).

The beneficiaries of this category must meet the following conditions:

• They have to be unemployed for 12 continuous months
• The men have to have completed their 60th year of age and women their 55th year of age for the category “old insured”

The insured men for the heavy and unhealthy professions have to have completed their 55th year of age and the women their 50th year of age, while the new insured persons have to have completed their 60th year of age either if they are men or women.

• They should not have an insurable disability above 67%

The contributions are paid entirely by the specific organization "LAEK", a department of OAED.  They are calculated based on the insurance class on which the unemployed was ranked on the day he / she submitted his / her application based on the earnings he / she received on the day he / she interrupted his / her work and cannot be of a lower class of the one corresponding to the wage of an unskilled worker.

In this arrangement there have also been included the dismissed persons of the age between 55 and 64 years, as long as they remain unemployed for at least three consecutive months (Article 66 of N.3996 / 2001 and Social Security Circular 96/2011).

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.