Overview and Introduction

They say there are two things in life that are certain: death and taxes. That’s true for most places, and Greece is certainly one of those places. 

Greece might not have the highest tax rates in the world, but they do have both indirect and direct taxes, and most people who live there will pay tax on their global income in Greece. So, let’s take a closer look at the tax system in Greece, and find out what you might need to pay if you make the sunny country of Greece your home base. 

So, if you’re hoping to get a golden visa and move to Greece, read on to find out what you might face on the tax front. 

Types of Taxes in Greece

As we mentioned before, Greece has both direct and indirect forms of taxes. So, you will pay tax on items you buy as well as money you earn. It’s quite a complex system though, so there’s quite a lot to break down when it comes to the types of taxes in the tax system in Greece! 

Income Tax

Like most countries, the tax system in Greece includes income tax, and that tax is a sliding scale based on the amount of money you earn. 

Anyone who is a permanent resident of Greece will pay tax in Greece on their income in Greece and around the world. They will also be taxed on both their income as an employee and their self-employment income, although people who are only an employee are not obligated to file tax returns, as taxes are already deducted by their employers. 

People who earn under 25,000 Euros pay tax at a rate of 22%, those who earn between 25,001 and 42,000 Euros will pay 32%, and those earning over 42,000 pay 42%. There is also a “solidarity tax” that is between 0 and 10% depending on what your total earnings are. 

Social Security Tax

Like the rest of Europe, people who work in Greece are required to pay social security tax. Their employer will also pay a portion of the tax. Social security taxes are used to fund things like unemployment insurance and disability insurance and can be transferred to different countries in Europe if you move there for work or are transferred. 

Employees contribute 15.5% of their earnings to social security, which is matched by 24.56% paid by the employer. Self employed people have to pay social security taxes too, and they will pay between 27.1%, which is 20% for social security and 7.1% towards public health. 

Corporate Tax

If you run a corporation in Greece, you will also be taxed under the tax system in Greece. Companies that are registered and based in Greece are taxed on their global earnings, while foreign companies are only taxed on their Greek earnings. 

The good news is that the corporate tax rate in Greece has been slowly reducing in recent years from a high of 29% in 2015. Currently, it is set at 24%. 

Capital Gains

Both companies and individuals in Greece are charged capital gains tax when they earn income from the sale of certain assets. Corporations will pay tax on this profit at the current corporate tax rate at the time of the sale, while individuals will pay 15%.

One notable exception is there is no capital gains tax on profits made on the stock market, provided your total ownership in the company whose stock you have profited off is no more than 0.5%. 

Withholding Tax

Withholding tax is levied on most corporate dividends, interest, royalties, payments and fees for various consulting services and projects. These range from 20% for royalties and consulting fees to 10% for dividends, 15% for interest, and 3% on the value of lease payments and projects under construction. 

VAT or Value Added Tax

Like most countries in Europe, Greece uses the Value Added Tax system. There are three tiers to the system: the standard rate of 24%, a reduced rate of 13% and a super reduced rate of 6%. 

Different types of products are taxed at different rates based on criteria set by the government at point of sale, and if you want a full list, it’s advisable to check the government website. VAT returns can be done monthly or quarterly depending on the accounting system used by the company completing the return. 

Property Tax

If you own property in Greece, you will be charged tax on that property. There are two parts to this tax: the main part, and the added part. The main part of the property tax is based on the property’s characteristics, including where it is located. The added part is based on the total value of property you own over the value of 250,000 Euros, and ranges from 0.15% to 1.15%, based on the total value of owned property. 

Inheritance Tax

Unlike some countries, the tax system in Greece does include tax on inheritances. There is a tax free amount, which does vary by year, so it’s worth checking what the latest amount is. Only money over and above that value will be taxed. 

If the deceased was a close relative, the tax rate for inheritances will be somewhere between 1 and 10%. For people other than close relatives, the amount could be anything from 0 to 40%, depending on the value above the tax free threshold. 

Tax Exemptions and Deductions in Greece

So far, we’ve talked about taxes that you will pay, but like every other country, the tax system in Greece does allow for exemptions and deductions. 

Several kinds of income are tax exempt, including:

• Earnings from ships and shipping
• Proceeds from the sale of shares on the Athens Stock Exchange
• Capital gains from business sales concluded between family members
• Dividends from Greek companies

Individuals are also eligible to reduce their tax bill by claiming certain deductions, including:

• Compulsory social security payments
• Donations to charities and religious organizations
• 15% of your rent paid on an apartment, up to the maximum threshold
• 15% on the mortgage of your first apartment purchase

As with any country, tax rates, exemptions and deductions are reviewed and altered on an annual basis, so it’s a good idea to check the current tax regulations when you move to Greece. If you have a complex situation where you are earning local and international income, own companies and area paid a salary, it’s also important to seek professional help with your taxes. 

Double Taxation?

Greece has a double taxation treaty with the UK, so UK nationals in Greece may have some additional benefits, exemptions and deductions on their earnings. 

Frequently Asked Questions About Tax System in Greece

How do you register for tax in Greece?

If you are a Greek resident who is required to pay tax on your earnings as an employee, a self-employed person or property owner, you will need to register for an AFM number, also known as a TIN or Tax Identification Number. You can apply for a tax number with your local tax office or Eforia. 

When will I pay tax in Greece?

Income tax is paid once a year in Greece. Social security taxes are paid 12 times and are usually deducted from employee’s paychecks along with their other taxes. VAT is usually paid when you make a purchase and is usually included in quoted prices for goods and services, however if you have to do a VAT return, you will usually do it quarterly. 

What happens if you don’t pay tax in Greece?

Greece used to have a reputation for tax evasion and corruption, but that’s all changed since the financial crisis there. The Greek government is a lot stricter about collecting taxes these days, and the penalties for tax evasion are quite stiff, including prison terms of up to 20 years, depending on how much your income was. 

What kind of taxes do non-permanent residents pay?

Unlike permanent residents, who pay taxes on their global earnings in Greece, people who are not permanent residents but who earned an income in Greece are liable only for taxes on the income they earned in Greece. This would apply to migrant workers or people who are in Greece on a work permit. 

How much can you earn in Greece before you pay tax?

If you earn under 12,000 Euros per year, you will not pay income tax in Greece. However, if you own property or a company in Greece, you will still be taxed on the value and earnings of those assets. 

How long can you stay in Greece without paying taxes?

If you are just visiting Greece, and you won’t be earning any income there, you can stay in the country for 183 days (about six months) before you run into tax related trouble! 

Does Greece tax foreign pensions?

Yes. Greece taxes foreign pensions at a flat rate of 7%, so if you plan to retire in Greece, you will be paying taxes on your international pensions. Since some countries (like the US) also tax their citizens no matter where they live, this can add up to a fairly significant amount, depending on where you are a citizen.