Taxes in Europe Database v2
Law No 2238/1994 ratifying the Income Tax Code (Government Gazette I, 151 A', 6 September 1994), as amended by Law No 2579/1998 (Government Gazette 131 A/17.2.1998) Law No 2992/2002, and Law No 3091/2002, Law No 3232/2004, Law No 3296/2004, Law No 3312/2005, Law No 3427/2005, Law No 3522/2006, Law No 3610/2007and Law No 3697/2008, Law No 3697/2008, Law No 3842/2010, Law No 3943/2011, Law No 4024/2011 and Law No 4038/2012.
Spouses file a joint return but each spouse is liable for the tax payable on his or her share of the joint income.
- Every Individual who derives income from sources in Greece is subject to tax irrespective of his place of domicile or residence. Moreover, every individual with place of domicile or residence (more than 183 days) in Greece is subject to tax on his/her worldwide income. Due consideration is given to bilateral conventions designed to obviate double taxation.
- An unclaimed estate.
- Limited and unlimited general partnerships, civil law communities carrying out a business or profession, civil companies, whether with profit-making intent or not, undisclosed companies, participation companies and joint ventures as referred to in Article 2 (2) of the Books and Accounts Code (Presidential Decree No 186/1992).
Obligation to file a tax return:
A. The individuals mentioned above who have a yearly taxable income of more than EUR 3.000 (or EUR 5.000 for income derived only from salaried work).
B. The individuals who derive income only from sources in Greece.
C. The following individuals, regardless of having taxable income or not:
- those who buy or possess cars, yachts or planes (with some exceptions)
- those who owe a personal business
- the self-employed
- those who participate in businesses
- those who buy or possess buildings
- those who possess houses (for personal use)
- those who are farmers (main profession)
- those who receive grants
- those who sell products in free markers
- those who cultivate green houses more than two acres.
Note:Spouses file a joint return but each spouse is liable for the tax payable on his or her share of the joint income. Losses incurred by one spouse may not be set off against the income of the other spouse. Deductible personal expenses concerning both spouses and tax credits are apportioned to each spouse according to the income earned by each one of them. Children under the age of 18 are, in principle, taxed jointly with their parents.
Total income of all categories (e.g. income from immovable property, salaries, enterprises etc.).
In order to determine the tax payable on the total net income of each taxable person, the different categories of income are summed up and positive and negative figures are netted out.
Where provided for by Law, allowances and expenses are then deducted and the remainder constitutes the taxable income. Income tax itself, fines and other taxes are not deductible.
The untaxed amount of income in respect of dependent children is increased as follows:
-by €2.000 for one child
-by €4.000 for two children
- and by €3.000 more for each child above two
If no liability for tax arises from the application of the taxation scale, or the liability is less than the total of the above reductions, the full amount of the reductions or the difference is deducted from the tax payable by the spouse, as calculated on the basis of the scale.
Furthermore, the untaxed amount of income of a handicapped taxpayer (invalidity over 67%) or of any handicapped person (invalidity over 67%) living with the taxpayer and depended upon him, is increased by €2.000.
Persons living abroad and deriving income from a Greek source are not entitled to the above tax reductions, unless they are residents of the European Union Member States and the income they derive from a Greek source exceeds 90 % of their total income.
Deductions (expenses of enterprises)
In order to determine the net taxable income of enterprises keeping accurate 3rd and 2nd category Books (Code of Books and Accounts) a number of expenses are deducted, such as:
-payroll and remuneration of staff
-insurance premiums in cases of team life insurance schemes for the staff, including lump sums and regular payments
-donations of money as deducted from the taxable income of private individuals (see above)
-expenses for the maintenance and repair of buildings and cars, in proportion to their size and value and according to specifications laid down by law
-the value of raw materials used in production, as well as of other trade goods including special expenses on transportation, storage etc
-rights and charges paid to enterprises and organisations for the use of technical assistance, novelties, trade marks, industrial methods, intellectual property etc, - according to specifications laid down by law
-it has to be noted that if the provider of the above goods and services is an off-shore company, the expenses are not deducted, save for specific cases such as the purchase of petroleum products etc.
-expenses for scientific and technological research, according to specifications laid down by law
The following tax credits are deducted from the payable amount of tax, as calculated on the basis of the scale:
1. 10 per cent of the expenses of hospital care of the taxpayer and his/her dependents. The total credit cannot exceed €3.000. Hospital expenses in respect of unmarried or widowed children who suffer from an incurable disease, who are mentally retarded or are blind and whose total annual income does not exceed €3.000 are also included.
2. a. 10 per cent of the total annual amount of rent paid for the taxpayer’s main residence, not exceeding €1.000, provided that the taxpayer or his dependents do not own a dwelling with a surface equal to or larger than the rented dwelling in the same region and that the taxpayer does not receive any rent allowance from the state (the tax credit cannot exceed €100).
b.10 per cent of annual rent paid for the dependent children who are studying at a recognized educational establishment in Greece up to a maximum of €1.000, provided that the dwelling is situated in the same region of the school or university (the tax credit cannot exceed €100).
Note: All expenses have to be declared; they are calculated jointly for both spouses and are attributed to each spouse according to their declared income.
3. 10 per cent of the educational expenses incurred by the taxpayer for himself or for his dependent children up to a maximum of €1.000 per person. The expenses paid by divorced parents are also included (the tax credit cannot exceed €100 for each child separately).
4. 10 per cent of the annual interest of mortgage loans for the main residence of the taxpayer. The relief is limited where the financed amount does not exceed € 200.000 and the residence does not exceed 120 square meters.
5. 10 per cent of the interest paid on loans granted for by banks and other credit institutions for the restoration, maintenance or improvement of scheduled buildings and buildings located in areas classified as traditional urban districts or as traditional settlements. The amount of the deduction is calculated upon the interest derived from the part of the loan that does not exceed €200.000.
6. 10 per cent of the insurance expenses for life/death/accident/sickness for the taxable person, his/her spouse or their dependent children. This also includes the expenses for child insurance paid annually by divorced parents. The tax credit cannot exceed €120 for a single taxpayer and €240 for a family.
7. 10 per cent of the amount of alimony that is paid to a spouse and is adjudicated/or agreed by notary deed. The tax reduction cannot exceed €1.500.
8. a. 10 per cent of the total amount of donations to the State, municipalities and communities, state universities, the church, the monasteries of Mount Athos, the World Patriarchate of Constantinople, the Patriarchate of Alexandria and Jerusalem, the Sacred Monastery of Mountain Sinai, the state and municipal nursing homes and hospitals which are subsidized from State budget and the Archaeological Resources Fund.
b. 10 per cent of the total amount of donations to public or private non-profit legal entities which have been or are being legally constituted for cultural purposes.
c. 10 per cent of the amounts donated to philanthropic institutions, non-profit making bodies which provide educational services or grant scholarships, Greek legal entities governed by private or public law which have been or are being set up for philanthropic purposes.
Note: The total amount of all the above donations cannot exceed 10 per cent of the total income that is taxed by the general provisions.
9. 10 per cent of the amount spent on the installation of natural gas system, solar panel systems, thermal insulation, teleheating systems e.t.c.. The tax credit cannot exceed €300.
10. 10 per cent of legally compulsory contributions to social security funds, and optional contributions to legally constituted funds.
11. € 60 in respect of each dependent child for taxpayers with employment income living for at least 9 months of the year in certain border areas or in certain islands. In case of a married couple, at least one spouse must satisfy these requirements in order for his/her family to receive this deduction.
Note: Taxpayers who reside abroad but derive taxable income from sources in Greece are not eligible for these deductions, with the exemptions of residents of the EU Member States who derive at least 90 per cent of their total income from sources in Greece.
As regards second category deductions (i.e from the payable amount of tax), when the wife derives income deemed taxable on the basis of the scale, then the following are deducted from her own payable amount of tax: a) medical expenses of the wife, her children from a former marriage, her children born out of wedlock, her parents and orphaned relatives of first and second degree of kin b) interest arising from first-home loans c) deductions for children afforded because of service in border areas.
If from the joint tax return submitted by the spouses no tax obligation arises for one of them, or the payable amount of tax is less than the sum of the deductions (medical expenses, rent of main residence or residence of children who are studying, expenses for additional outside or home tuition, deductions for children because of service in border areas) then the whole amount of the deductions or the ensuing difference is attributed to the payable tax of the other spouse.
The losses of income from commercial and agricultural undertakings manifest in 3d and 2d Category Books (Accounting Information Code - e.g public limited companies) may offset taxable income from other sources or be carried over for the next five years, provided that the books are properly and accurately kept over that period. Losses incurred abroad can only be offset against income derived abroad.
Some forms of income, specified by Law (art.6 of Law No 2238/1994, as amended) are exempt from the tax.
Exemptions from tax on savings:
Above rates are applicable for salaried persons, non salaried persons, self employed and pensioners and refer to income earned in 2010. More detail below:
SCALE: Salaried persons, Non salaried persons, self employed and pensioners. Income earned in 2011.
Tax for the step (euro)
Total Income (euro)
Total Tax (euro)
Should the taxpayer be able to file with tax authority invoices of a higher value than the one required for the tax-free threshold, he is entitled to a reduction of the payable tax by an amount equal to 10% of the exceeding value. Should the value of invoices be less than the one required for the tax free threshold, a 10% income tax is imposed on the remaining amount.
Income from Dividends
Individuals-tax residents in Greece, are taxed on the basis of the personal income tax rate scale with respect to the dividend that they receive, but are subject to a different treatment depending on their total income. Tax liability on dividend is exhausted regarding individuals whose total income is subject to a maximum rate higher than 25% (or 21% regarding dividends received within 2011), but general provisions are applied regarding those whose total income is subject to a maximum tax rate lower than 25%.
Tax on savings
Interest paid by Greek Individuals to beneficiaries abroad:
As regards, interest paid by Greek individuals to beneficiaries abroad a 40% tax is withheld by the individual paying the interest. The intermediary bank may deny remitting the remaining interest amount abroad unless a payment certificate for the corresponding tax withheld is submitted to it.
Tax is due on interest derived from loans which is at least equal to the one resulting by applying the minimum interest rate of interest-bearing treasure bills of three month duration.
Greek government bonds (art. 12 Income Tax Code):
Greek corporate bonds:
Interest deriving from private companies’ bond loans falls under the same taxation as interest deriving from government bonds (paragraph 8, article 26, Law 2789/2000), without any obligation of retaining the titles.
Foreign government bonds:
Income taxed individually
Some forms of income are taxed individually, and the payment of such tax exhausts the tax liability regarding this income. Examples:
Tax on the transfer of listed shares
A tax of 2‰is levied on the sale of shares listed in the Athens Stock Exchange Market for transactions effected in it. The tax is calculated upon the price value of the share and must be paid by the vendor, whether natural person or legal entity and regardless of his nationality, place of residence or establishment etc. This tax is also levied on sales of shares listed in foreign Stock Exchange Markets.
Sales of shares affected by Special Negotiators (Law No 1806/98, art 22 A) are exempt from the tax.
For dividends received within 2011, the withholding tax rate was 21%, whereas from 2012 onwards, the withholding tax is 25%. The tax liability on dividend is exhausted regarding individuals whose total income is subject to a maximum rate higher than 25% (or 21% regarding dividends received within 2011), but general provisions are applied regarding those whose total income is subject to a maximum tax rate lower than 25%.
The tax can be paid in three equal monthly instalments. If the tax is fully paid due time, a deduction of 1.5 % is offered.
Ministry of Finance.
Municipalities-local authorities are beneficiary of the revenue for: 20 %.
Spouses must submit a joint tax return, except in certain cases specified by Law. Taxes, duties and levies on the income declared in the joint return are calculated separately for each one. Losses by one spouse can not be offset against the income of the other. The income of one spouse is added to that of the other and taxed as if it were the latter’s if it accrues from a business that is financially dependent on that other spouse.
Children’s own income
The income of minor children is added to that of the parent with the larger total income before that income is added up and is taxed in that parent’s name. If the latter does not have custody of the child, the minor’s income is added to that of the other parent and taxed in that parent’s name. Where the parents’ total incomes are equal, the income of their minor children is added to the father’s income provided that he has custody. The children’s income deriving from parental contribution or gifts of assets is added to the income of the parent who made the contribution or the gift. In certain cases specified by law, a minor child has a personal tax obligation in respect of any income.
Generally, non-residents are taxed in the same way as permanent residents, subject to any bilateral conventions between Greece and other countries designed to avoid double taxation.
In the case of persons residing abroad and deriving income from Greece, an additional tax calculated at 5 % is added to the amount of tax corresponding to the first step of the scale. This provision does not apply to persons living in the Member States of the European Union, for whom income received in Greece exceeds 90 % of their total income.
Presumptions of income
The ownership of certain “luxury” goods, such as houses (first house and second houses), cars, leisure boats, private planes and helicopters, swimming pools, suggests that the taxable person disposes of a minimum amount of yearly income to provide for the goods’ expenses (preservation, circulation etc). This amount is determined by the tax authorities according to certain objective criteria relating to the goods’ size, age etc. The taxable person can challenge this “presumption” in certain cases laid down by Law (unemployed persons, persons co-habitating with their parents, serving in the army, underage orphans, incarcerated or hospitalised persons and anyone that can prove force majeur), by producing conclusive proof that the actual expenses were lower.
Special features (Partnerships and other entities)
Partnerships under Greek law may be either unlimited or limited general partnerships. Other types of entities (apart from corporations) subject to income tax are joined ventures, civil companies and undisclosed companies. Partnerships are currently taxed at 25%. Especially for the profit of unlimited partner (only for individuals) the tax rate is 20%. Joint ventures, civil companies and undisclosed companies are currently taxed at 25%. This rate is imposed after deduction of:
The payment of this tax discharges the tax liability on the profits of the individuals participating in such legal persons.