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Taxation in Greece
Taxation in Greece

Income tax

If you are resident in Greece for tax purposes, you are taxed at progressive rates on your world-wide income earned in a calendar year. You may also be eligible for certain tax allowances, depending on your family situation, which are taken into account when calculating your taxable income, as well as the amount of tax you are liable to pay.
If you are employed, your employer will deduct income tax from your wages, daily allowances or other remuneration. The amount is imputed to your total tax bill for the year, which is calculated on the basis of your yearly income tax return. If more tax has been withheld than is in fact owed by you, you will be rebated the difference.
Your yearly income tax return should be sent to the Public Financial Offices (DOY) by 1 March of the tax year in question (in exceptional cases by 1 April, 16 April or 2 May for certain types of income explicitly referred to in tax law). You will be informed between May and June of the amount of tax that you have been assessed to pay. Married couples must file a joint tax return in which the tax, charges and contributions are calculated separately for each spouse. Husbands are obliged to submit a tax return for their wives.
A tax deposit is sometimes taken of an amount equal to 55% of your total tax bill for the current year. A deposit is not required when the amount due does not exceed 30 Euros , when your only income is from salaried employment and if you own your own home.

Your tax bill is payable in three equal instalments. You are, however, eligible for a 2,5% reduction on your total tax bill if you pay all your tax by the date on which the first payment is due, regardless of whether the tax is to be paid in one or more instalments. If you submit your tax return via the Internet, another 2,5% reduction on the total tax bill is granted up to a maximum of 118 Euros, regardless of the number of instalments.

If you are resident in Greece for tax purposes, you also have to include income earned in another Member State in your tax return (i.e. your world-wide income). If this income has already been taxed in the other country, you will be credited for that in your tax assessment in Greece. If the tax paid in the other country is higher than the corresponding Greek tax, you will not be rebated the difference.

Immovable property income is taxed together with all other income of natural persons. The tax scale for 2005 is:

Tax steps


Tax factor %


Tax of Step


Total of

Income


Tax

8.400


0


0


8.400


0

5.000


15


750


13.400


750

10.000


30


3.000


23.400


3.750

* Tax exemptions: 10% of dwelling house and 5% of commercial premises rent is tax exempt.
* Additional Taxes on income: 3,6% duty stamp, 1,5% additional tax (increased to 3% on big houses, exceeding 300m or properties belonging to off-shore companies.
* Living in one's own house is tax free if the house does not exceed 150 m.

To avoid paying income tax for money transferred into Greece from abroad you have to send the money from your account in your home country into your account in Greece. If you are buying a property in two names, be sure that each person sends the equal amount from their account abroad into their account in Greece. In this way you can show the Greek authorities that the money sent was already taxed in another country.

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Double Taxation

Greece has signed treaties for avoiding double taxation on income with all other Member States.

Under these agreements, the right of taxation is divided between the two Member States concerned (country of residence- country of origin), and both States cede tax advantages (country of origin = tax reduction or exemption, country of residence = tax incentives). The treaties also regulate double taxation by means of the calculation method described above, insofar as the tax paid in the other State (country of origin) is referred to in the treaties. Where this is not the case, the tax paid unduly in the country of origin (i.e. in spite of the provisions of the relevant agreement) is not credited against the corresponding Greek tax, and the person concerned must apply for reimbursement of the tax from the State which levied it.

Greek residents (physical or legal persons) acquiring income from a State which is party to the treaties must present a certificate of tax residence to the tax authorities of that State so that the provisions of the treaties can be applied directly.

Most of the States which are party to the treaties have adopted a special form incorporating the certificate of tax residence, which those persons affected (living in Greece) must submit to the competent Directorate of the Ministry of Economic Affairs and Finance (International Economic Relations Directorate), together with an application and a mandatory certificate from the competent Directorate. The certificate of tax residence will then be issued on the basis of these documents.

List of countries which signed the double taxation agreement with Greece
AlbaniaArmeniaAustriaBelgium
BulgariaChinaCroatiaCyprus
Czech Republic DenmarkEgyptFinland
FranceGeorgiaGermanyHungary
IcelandIndiaIrelandIsrael
ItalyKoreaKuwaitLatvia
LithuaniaLuxembourgMexicoMoldova
NetherlandsNorwayPolandPortugal
RomaniaSlovakiaSloveniaSouth Africa
SpainSwedenSwitzerlandTurkey
UKUkraineUSAUzbekistan

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Inheritance & donation tax

The taxes on Inheritance and Donation (or parental donation tax) vary according to the degree of relationship as below -in Euros-

CATEGORY A (Spouse, children, parents-children-parents)
Tax steps

Tax factor
(%)


Tax amount


Total property value


Total tax amount

20.000


0


0


20.000


0

40.000


5


2.000


60.000


2.000

160.000


10


16.000


220.000


18.000

Exceeding


20







CATEGORY B
(grandchildren, grand-grandchildren, grandparents, brothers, uncles etc.)
Tax steps

Tax factor
(%)


Tax amount


Total property value


Total tax amount

15.000


0


0


15.000


0

45.000


10


4.500


60.000


4.500

160.000


20


32.000


220.000


36.500

Exceeding


30







CATEGORY C (1st cousins, strangers)
Tax steps

Tax factor
(%)


Tax amount


Total property value


Total tax amount

5.000


0


0


5.000


0

55.000


20


11.000


60.000


11.000

160.000


30


48.000


220.000


59.000

Exceeding


40







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