Tax regimes in Greece: everything you need to know

Taxpayers in GreeceThey face some of the highest tax rates in the European Union. At the same time, the country has special tax programs that allow for a reduction in the tax burden, provided that one resides in a country with a promising economy and affordable real estate prices.

Rules for tax residents

According to Greek law, by residing in Greece for more than 183 days per year, foreign nationals become tax residents. In order to do so, they must hold a Greek residence permit or have a a center of vital interests in Greece. The counting of days starts from the moment of crossing the border. Tax Tax residents are taxed on all their worldwide income. However, it is possible to have tax treaties, which may exempt or provide for the payment of taxes in the home country.

Main tax rates

• Income tax is calculated on a progressive scale.
• Starting at 9% on income up to €10,000 per year
• Reaches 44% on income over 40,000 euros per year
• Tax deductions depend on the number of family members and whether your employer meets the quota for purchasing goods and services in Greece or the EU.
• Mandatory social security payments and donations to charitable organizations

Consultations with professionals

Greece offers various tax regimes that can help reduce the tax burden for tax residents. However, before making any decisions regarding your tax status in Greece, it is advisable to consult a professional tax advisor or lawyer with experience in Greek legislation.

Taxes in Greece

The tax system in Greece is divided into capital taxes and consumption taxes. Capital taxes include certain property taxes, such as real estate and inheritance taxes, while consumption taxes cover VAT and excise duties.

VAT and stamp duty

VAT in Greece is 24% for most goods and services, but there are also preferential rates of 13% and 6%. rates of 13% and 6%. As of July 1, 2021, the VAT rate on some islands, such as Chios, Leros, Lesvos, Kos and Samos, was reduced to 17%.

Tax regimes for foreigners in Greece

For foreigners living in Greece, there are several tax regimes that can be quite beneficial with the right approach. One of these regimes is a simplified tax system that offers a 50% discount on income tax and solidarity contributions for new employees and entrepreneurs starting from the 2021 tax year.

Conditions for participation in tax regimes

This regime applies to individuals who have not been tax residents of Greece for five out of the last six years, transferring their tax residency from an EU or EEA member country or from a country with which Greece has an agreement on administrative cooperation in tax matters. The regime also applies to individuals working in Greece under an employment contract or engaging in entrepreneurial activities, as well as those planning to reside in Greece for at least two years.

Tax advantages for foreign pensioners

Another interesting tax advantage for foreigners living in Greece is the possibility of paying a reduced income tax rate on foreign sources for foreign retirees, which is only 7%. The exemption from solidarity contributions and the reduction of the overall tax burden create more attractive conditions for elderly individuals maintaining their financial status abroad.

Important restrictions and application deadlines

It is important to note that in both cases there are clear conditions for participation in these programs, as well as deadlines for applications and the duration of the regimes, which should be taken into account when planning tax expenses. Nevertheless, these tax benefits make Greece more attractive to foreign citizens who are considering the possibility of moving and living in this beautiful country.