Greece Personal Income Tax

Individuals who are tax residents of Greece are taxed on their worldwide income. Nonresidents are taxed on their Greek-source income only.

Individuals are considered to be Greek tax residents if they sat­isfy any of certain specified conditions, including, among others, the following:

  • Their center of vital interest is in Greece (that is, their domicile).
  • Their habitual abode is in Greece. An individual’s habitual abode is deemed to be in Greece if the individual spends more than 183 days in Greece. This condition is deemed to be satis­fied if an individual has spent over 183 days physically in Greece (short stays outside Greece are also counted to deter­mine whether the 183-day threshold has been exceeded). After the above-183-day threshold is surpassed, the individual is deemed to be a Greek tax resident as of the beginning of the 183-day period in Greece. An exception to the above-183-day habitual abode rule applies to individuals coming to Greece for “medical, tourist or similar private purposes” and staying in Greece for more than 183 days but less than 365 days in a cal­endar year; that is, although they surpass the above 183-day threshold, they are not considered as having their habitual abode in Greece.

Protection under a double tax treaty may be available if the indi­vidual can claim to be tax resident for the respective tax year of another country with which Greece has entered into a double tax treaty.

Individuals that are deemed Greek tax residents are taxable on their worldwide income.

Non-tax residents are liable to pay tax in Greece on their Greek source income only.

Non-tax residents who earn income from Greek sources should obtain supporting documentation, such as a tax-residence certifi­cate, from their home country to validate their nonresident status in Greece if requested to do so.

Income subject to tax. The Greek Income Tax Code (Law 4172/2013) provides for the following four categories of income:

  • Employment and pension
  • Business income
  • Income from capital
  • Capital gains income

Different tax rates apply to the categories. Some tax rates are progressive while others are exhaustive. The taxation of various types of income is described below.

Employment and pension income. Employees are subject to income tax on income derived from employment, which includes income from salaries, wages, allowances, pensions, stock-based compensation and any other payments periodically made in cash or in kind for services rendered and certain other income items.

The Greek Income Tax Code contains specific provisions for the taxation of the following types of benefits:

  • Company cars, which are taxed in accordance to a deemed income formula
  • Loans provided to employees, which yield deemed taxable income to the employee
  • Company provided housing, regardless whether it is leased or owned by the company
  • Equity-based compensation

In general, the market value of benefits in kind received by an employee or a relative of the employee is considered taxable income for the employee if the value exceeds EUR300 per year.

Other payments usually made to employees on international assignment are taxable, including the following:

  • International service premiums
  • Cost-of-living allowances
  • Housing and education benefits
  • Relocation bonuses
  • Performance bonuses
  • Employee tax reimbursements
  • Other allowances paid periodically and regularly

Insurance premiums paid on behalf of an employee under an insurance program for health, medical or hospital coverage and/ or life insurance coverage of the employee are considered tax-exempt income for the employee up to an amount of EUR1,500 per year per employee.

Capital accumulated until 31 December 2013 that reflects insur­ance premiums paid by the employee in the course of a life insur­ance private pension scheme is considered exempt from tax (that is, it is not taken into account for the purposes of applying a special tax rate of 10% for insurance indemnities up to EUR40,000 and 20% for insurance indemnities exceeding such threshold that are paid out of and derived from such life insurance private pen­sion schemes).

Employer contributions toward a group life insurance private pension scheme are not considered to be employment income and are taxed separately on redemption at special final tax rates (con­ditions apply).

Expenses incurred by an employee in the course of their work duties does not constitute taxable income to the employee if proper tax documentation evidencing the expense exists and if it can be proven that the expenditure was a productive business expense.

Board of director fees are categorized as employment income for tax purposes.

Effective from 1 January 2016, the following new progressive tax rate scale applies to individuals with salary income, pension income, freelancer income and personal agricultural income.

Taxable income Tax rate Tax due Cumulative tax due
First 20,000 22 4,400 4,400
Next 10,000 29 2,900 7,300
Next 10,000 37 3,700 11,000
Above 40,000 45 ­

A tax allowance on the tax amounts resulting from application of the above tax scale is provided if the respective income is salary income, pension income or personal agricultural income. However, no such tax allowance is provided in connection with freelancer income.

If the above salary or pension income does not exceed the EUR20,000 threshold, the tax allowance is set at the following:

  • EUR1,900 for an individual taxpayer with no dependent children
  • EUR1,950 for an individual taxpayer individual with one dependent child
  • EUR2,000 for an individual taxpayer individual with two dependent children
  • EUR2,100 for an individual taxpayer with three or more depen­dent children

If the tax amount originally calculated by application of the above tax scale is lower than the tax allowance available for this level of income, the amount of the tax allowance is reduced to equal the tax amount.

If the above taxable amount exceeds the EUR20,000 threshold, the tax allowance is reduced by EUR10 for each additional EUR1,000 of taxable income.

If the taxpayer earns salary income and pension income, as well as taxable income from other sources, the above tax allowance is provided only with respect to the part of the income that derives from salaries, pensions or personal agricultural income.

Severance payments made by Greek companies to departing employees are taxed at the following rates.

Amount of income

Exceeding                                        Not exceeding                                    Rate

EUR                                                           EUR                                                    %

0 60,000 0
60,000 100,000 10
100,000 150,000 20
150,000 30

Business income. The above progressive income tax scale appli­cable to salary income and pension income also applies to the income of freelancers and single proprietorships; however, for these individuals, no tax allowance is provided. At the time of writing, administrative guidelines to regulate the practical appli­cation of this tax scale to this group of taxpayers were pending.

An unjustified increase of wealth of an individual is taxed as business income at a rate of 33%.

In general, an expense is considered to be deductible for business tax purposes if it satisfies the following conditions:

  • The expense is incurred for the benefit of the company in the course of its usual business transactions.
  • It corresponds to an actual transaction and the value of the transaction is not deemed to be lower or higher than the market price of a similar transaction.
  • It is recorded in the proper accounting books for the period and is evidenced by proper documentation.

Income from capital. Dividends are subject to a 10% final with­holding tax. This rate will increase to 15% for dividends distrib­uted on or after 1 January 2017. Solidarity tax is also due at the rates indicated in Solidarity tax contribution. The concept of dividends is extended, in accordance with Organisation for Economic Co-operation and Development (OECD) guidelines, to include all distributed profits, regardless of the legal form of the distributing entity. Foreign dividends received by a Greek tax resident may be subject to more favorable tax treatment under an applicable double tax treaty.

Interest is subject to a final withholding tax rate of 15%, with no further personal income tax liability for individuals (but solidar­ity tax is assessed in addition to the withholding tax on assess­ment of the personal income tax return filed annually).

Royalties are subject to a final withholding tax rate of 20%, with no further personal income tax liability for individuals (but soli­darity tax is in addition to the withholding tax on assessment of the personal income tax return filed annually).

Income from immovable property is subject to tax in accordance with the following progressive tax scale.

Real estate income Tax rate Tax due Cumulative tax due
First 12,000 15 1,800 1,800
Next 23,000 35 8,050 9,850
Above 35,000 45

Income from immovable property is any income whether in cash or in kind that is derived from the leasing, self-use or free-use of real estate.

To derive income in kind, a 3% rate of return is applied to the objective value of the real estate.

Profits derived by individuals from the sale of shares listed on the Athens Stock Exchange or in any recognized foreign stock exchange market are subject to transaction tax at a rate of 0.2%.

Capital gains. Capital gains from the transfer of capital are taxed at a rate of 15%. They include gains from the transfer of securi­ties if such transfers are not classified as business activities. For the transfer of listed shares or other listed securities, a capital gains tax is imposed only if both of the following circumstances exist:

  • The listed shares or listed securities were originally acquired after 1 January 2009.
  • The transferor holds a 0.5% or higher stake in the share capital of the company.

The above provisions apply to capital gains from transfers of securities taking place on or after 1 January 2014.

An exemption from capital gains tax applies to gains derived from the transfer of securities if the seller is a tax resident of a country with which Greece has entered into a double tax treaty.

Losses incurred from the sale of securities can be carried forward for a five-year period and be offset against profits that arise from the same income category.

Taxation of employer-provided stock options and restricted stock units. The benefits derived from stock options and restricted stock units (RSUs) are determined on a current basis. Under this method, the stock-exchange price taken into account is the price applicable at the time the right is actually exercised or vested in the case of RSUs.

Other considerations

Deemed income. The amount of declared income is compared with the amount of deemed income, determined based on evi­dence relating to amounts spent on the acquisition of assets and on living expenses.

In general, amounts spent for the acquisition of assets are consid­ered evidence of income to the extent that such amounts cannot be justified by the following:

  • Taxable income
  • Tax-exempt income or income that has been taxed under special rules, such as bank interest and directors’ fees
  • Capital that has been accumulated out of taxed or tax-exempt income of prior years or from the sale of assets
  • The importation of foreign exchange into Greece (restrictions apply to the importation of foreign exchange by Greek tax resi­dents to cover deemed income)
  • Contracted loans
  • Gifts received or gains from lotteries

Capital purchases (for example, a home or car) constitute deemed income on an “actual expense” basis. Certain items generate deemed income under the “living expenses” section. In this con­text, deemed income from “living expenses” is derived from assets that are owned, while deemed income from “actual expens­es” is derived from amounts spent to purchase assets. Currently, the list of deemed income items consists of the following:

  • Motor cars, pleasure boats, aircraft, and chattels of great value.
  • The annual deemed income for using a private home that is owned, rented or granted for free. The deemed income is calcu­lated based on the square meters of the home and on the zone prices applicable for the respective location. For secondary residences, the amount described in the preceding sentence is reduced by half.
  • The annual objective living expense for cars is calculated according to the engine capacity of each car.
  • Swimming pools.
  • Annual donations in excess of EUR300, except donations made to the state and municipal governments and other government bodies.
  • Loans and gifts from parents to children in excess of EUR300.
  • Purchase or formation of a business, increase of share capital for amounts invested in the business or purchases of shares or securities in general.
  • Annual expenditure for the payment of interest and principal with respect to loans or credit.
  • Purchases of valuable articles over EUR10,000.
  • Loans granted to anyone.
  • Repayment of loans.
  • Private education and private school tuition fees, and remunera­tion for housemaids, private drivers, teachers and other house­hold personnel.

Deemed income does not apply to non-tax residents who earn no real income (any amount or type of income) in Greece.

Earning of income. Income is deemed to be earned at the time the individual has the right to collect such income. Exceptionally, for uncollected accrued income from employment or pensions that has been collected by the beneficiary in a later tax year, the time of acquisition of such income is the time of collection.

Credits. Greek and foreign tax resident individuals may subtract certain credits from the tax computed on their taxable income. All claims regarding expenses must be supported by proper documentation.

A 10% tax credit is provided for the following:

  • Medical and hospital expenses of the individual and dependents to the extent that these exceed 5% of the taxable income of the individual. The tax credit cannot exceed EUR3,000.
  • Donations to public entities, charities and nonprofit organiza­tions in Greece or in the EU, European Economic Area or European Free Trade Association. The amount of the expense to which the 10% tax credit is applied cannot exceed 5% of the taxable income declared by the individual.

In addition, the tax law provides for a EUR200 credit per disabled individual living with an individual taxpayer.

A foreign tax credit is provided for foreign income declared that is taxed in Greece in accordance with the progressive income tax scale. The tax credit is limited to the Greek tax payable on that foreign income.

Rates. For the income tax rates applicable to the various catego­ries of income, see the sections on these categories in Income subject to tax.

Solidarity tax contribution. A special solidarity tax contribution is imposed on individuals who earn income exceeding EUR12,000 on an annual basis. In general, this solidarity tax contribution is imposed on the following:

  • Both Greek and foreign income of Greek tax residents
  • Greek-source income of foreign (non-Greek) tax residents

Net personal income (both taxable and tax exempt) is used to determine liability of the taxpayer.

The following are the progressive tax rates for the solidarity tax contribution for income earned on or after 1 January 2016.

Taxable income Tax rate Tax due Cumulative tax due
First 12,000 0.0 0 0
Next 8,000 2.2 176 176
Next 10,000 5.0 500 676
Next 10,000 6.5 650 1,326
Next 25,000 7.5 1,875 3,201
Next 155,000 9.0 13,950 17,151
Above 220,000 10.0 ­

Solidarity tax contributions are withheld from salary income on a monthly basis (together with the regular tax withholdings on salary income). In some cases (for example, dividends, interest and capital gains from sale of securities that are declared on the annual personal income tax return), solidarity tax is assessed on the filing of the individual’s annual personal income tax return.

For salaried employees, solidarity tax contribution withholdings are made on the basis of the salaried employee’s annual salary. A salaried employee’s annual salary is calculated on the basis of his or her monthly salary.

Luxury tax. A luxury tax is applied to the deemed income arising from the use of automobiles, pleasure boats (private yachts), airplanes, helicopters, gliders and swimming pools. The luxury tax rates range from 5% to 13%.

Other taxes

Inheritance and gift taxes. All property located in Greece, re­gardless of ownership, and any movable property located abroad that belongs to a Greek citizen or to any other person domiciled in Greece are subject to inheritance tax. All property located in Greece and any movable property located abroad that is donated by a Greek citizen or by a foreigner to a person domiciled in Greece are subject to gift tax.

Movable assets located abroad and belonging to a Greek tax resident who was established outside Greece for at least 10 consecutive years is exempt from Greek inheritance tax retro­actively from 23 April 2010.

The categories of rates for inheritance tax and gift tax depend on the relationship of the beneficiary to the deceased or donor. The rates are higher for more distant relatives and unrelated persons.

The following table illustrates the increase in the inheritance tax rates for categories of persons less closely related to the decedent.

  Threshold amount Tax on threshold amount Tax rate on amount exceeding threshold amount
Category EUR EUR %
A 600000 16500 10
B 300000 23500 20
C 267000 71700 40

A gift or parental grant of cash is taxed separately at a rate of 10%, 20% or 40%, depending on the relationship of the benefi­ciary with the provider.

Estate tax treaties. Greece has entered into estate tax treaties with Germany, Italy, Spain and the United States to prevent double estate taxation.

Real estate taxes. Purchases of new real estate are subject to value-added tax (VAT) at a rate of 24% under certain circum­stances. An exemption from VAT can be obtained for the pur­chase of a primary residence.

Annual Real Estate Tax (ENFIA) has replaced FAP. ENFIA is divided into a main tax and a supplementary tax. ENFIA applies to real estate located in Greece that is owned by individuals or legal entities.

ENFIA is payable on an annual basis. The tax payable depends on a number of factors, including but not limited to the follow­ing:

  • The zone price of the location where the property is located
  • The area the property in square meters
  • The intended use of the property
  • The age of the building
  • The floor where the property is located (if it is above ground)
  • The number of “building facades” of the property (that is, whether the property is adjacent to a public road and if so whether it is adjacent to more than one public road)

Additional ENFIA tax is imposed if the total value of the tax­payer’s land exceeds a threshold of EUR200,000. Rates ranging from 0.1% to 1.15% are applied progressively on the value of the taxpayer’s property in excess of the EUR200,000 threshold. At the time of writing, the ENFIA legislation was under review and amendments were expected in the near future.

At the time of writing, the Greek government was also consider­ing the introduction of a wealth tax but no final decision had been reached.

The rate of the real estate transfer tax is 3% for transfers occur­ring on or after 1 January 2014.

A special 15% tax is applied to real estate owned by foreign companies in Greece. Many exemptions are available. In certain circumstances, actions must be taken to obtain such exemptions.

Social security

Coverage. Several organizations administer the state social secu­rity system in Greece. In general, employed persons must par­ticipate in the Social Insurance Institute (IKA), which is financed by employer and employee contributions. Its benefits include pensions, medical expenses and long-term disability payments. Several other insurance organizations cover self-employed per­sons, depending on their trade or profession.

Contributions. Social security contributions are made by employ­ers and employees based on a percentage of the employee’s monthly salary.

Under recently enacted Law 4387/2016 and subject to the rele­vant ministerial decisions expected to be issued in order to regu­late the necessary details for the implementation of the law, contributions for the auxiliary social security fund is increased by 0.5% and the maximum cap for the calculation of contributions is also increased. Consequently, the employees’ contributions are now 16% and the employers’ contributions are now 25.06%. In addition, the maximum amount subject to social security contri­butions is now EUR5,860.80.

Totalization agreements. To provide relief from double social security taxes and to assure benefit coverage, Greece has entered into totalization agreements with the jurisdictions listed below.

Argentina                           Iceland                           Switzerland

Australia                             Libya                             Syria

Brazil                                  Liechtenstein                  United States

Canada                               New Zealand                 Uruguay

Egypt                                  Norway                         Venezuela

EU member states              Quebec

Tax filing and payment procedures

Tax returns must be filed by 30 April of the year following the relevant fiscal or calendar year.

Although married persons must file joint tax returns, they are taxed separately, not jointly, on all types of income.

Tax liability is determined by deducting from the computed amount of tax any previous advance payments of income tax, any taxes with held at source and any creditable amounts of foreign taxes paid.

In addition, if the individual receives income from a business, 100% of the amount of a current year’s income tax must be paid as an advance payment of the following year’s tax liability. The amount of the advance tax payment reduces the following year’s tax liability.

Income tax is usually paid in three equal bimonthly installments.

Double tax relief and tax treaties

Greek residents are entitled to a credit for foreign taxes paid, not to exceed the amount of Greek tax payable on the foreign-source income.

Greece has entered into double tax treaties with the jurisdictions.

Albania                        Hungary                     Romania

Armenia                       Iceland                        Russian Federation

Austria                         India                           San Marino

Azerbaijan                    Ireland                        Saudi Arabia

Belgium                       Israel                           Serbia

Bosnia and                   Italy                            Slovak Republic

Herzegovina                 Korea (South)             Slovenia

Bulgaria                       Kuwait                        South Africa

Canada                         Latvia                          Spain

China                           Lithuania                     Sweden

Croatia                         Luxembourg               Switzerland

Cyprus                         Malta                          Tunisia

Czech Republic            Mexico                       Turkey

Denmark                      Moldova                     Ukraine

Egypt                           Morocco                     United Arab

Estonia                         Netherlands                Emirates

Finland                         Norway                      United Kingdom

France                          Poland                        United States

Georgia                        Portugal                      Uzbekistan

Germany                      Qatar

Temporary visas (Schengen visas)

An entry visa, which may be obtained from the Greek embassy or consulate of the expatriate’s place of origin, is usually required for visiting Greece. However, a temporary visa is not required for citizens of EU-member countries, for citizens of the United States or for citizens of countries that have signed reciprocity treaties with Greece.

Non-EU nationals, including citizens of the United States or citi­zens of countries that have signed reciprocity treaties with Greece, who intend to enter Greece to obtain a Greek residence permit need to obtain a special type of Schengen visa from the Greek consulate or embassy of their country of origin before entering Greece.

Residence permits providing access to dependent employment and self-employment and permits for investors in strategic investments and owners of real estate

EU nationals are not required to obtain residence permits to live and work in Greece. However, EU nationals who intend to reside and work in Greece for more than three months must obtain a European Citizen Residence Card. This card, which may not be denied to EU nationals, is granted for an indefinite time period by the appropriate Police Department (Alien Bureau).

Non-EU nationals must obtain a residence permit. Greek law provides for specific types of residence permits for non-EU nationals, which provide access to employment in Greece. Consequently, a non-EU national does not need to obtain a sepa­rate work permit apart from the residence permit.

The competent authority for the issuance of a residence permit depends on the type of residence permit. For example, the Greek Ministry of Internal Affairs grants residence permits to members of boards of directors, administrators, legal representatives and higher executives of subsidiaries or branches of foreign compa­nies exercising their commercial activities legally in Greece. Residence permits are usually valid for one year and are renew­able.

In addition, individuals who have adequate means to support their activities and who are engaged in activities that make a positive contribution to the national economy may be self-employed in Greece if they obtain an entry visa and file an appli­cation for a residence permit.

Apart from the above, residence permits are available to non-EU citizens who will invest in Greece. Residence permits may be provided to executives of strategic investment projects in Greece.

In addition, a residence permit is granted to a third-country national (non-EU) who purchases real property or enters into a time-sharing agreement or lease agreement for a minimum 10-year term for hotel facilities or furnished homes in combined tourist facilities. The residence permit is granted for five years. The residence permit may be renewed for an equal term if the property remains in the ultimate ownership and possession of the interested party and if the party complies with other provisions of the applicable laws. The permit is granted if the interested party has been granted a visa (under certain conditions) and if the interested party has ultimate ownership and possession of the property in Greece, individually or through a legal entity of which the party is the sole owner of the respective shares or capital parts. The minimum value of the property should be EUR250,000. This residence permit does not establish any right of access to any form of employment.

Following recent changes in applicable legislation and the enact­ment of the Immigration Code (Law 4251/2014), a Blue Card may be issued to highly specialized personnel (European Directive 2009/50/EC). This Blue Card may be issued initially for two years and then renewed for three years, if certain condi­tions are satisfied. Only a certain number of employees, which are defined annually by the competent authorities, may enter Greece under such regime.

Family and personal considerations

Family members. Residence permits are granted to an EU citizen’s non-EU family members. Residence permits are granted to a non­EU expatriate’s family members only after two years of employ­ment in Greece, with the exception of families of members of boards of directors, administrators, legal representatives and higher executives of subsidiaries or branches of foreign companies exer­cising their commercial activities legally in Greece. These indi­viduals may apply for a residence permit together with the main applicant. However, family members must file separate applica­tions if they wish to work in Greece. Family members of Blue Card holders may be issued residence permits for family reunification if the expatriate proves that he or she has sufficient resources to sup­port them. These residence permits are exceptionally issued within six months following submission of the relevant applications (the above rule of two years of employment in Greece for the expatriate does not apply).

Marital property regime. Spouses (heterosexual couples) in Greece may choose the marital property regime they prefer. If they do not make an election, a regime of separate property applies. Spouses under a separate property regime may nonethe­less acquire common property.

Before or during the marriage, the spouses may modify the de fault regime of separate property by entering into a marital con­tract adopting a community property regime. The contract must be notarized and recorded in the public registry. The commu­nity property claims purport to survive a permanent move to a non-community property country.

The property relationship of the spouses is subject, in order of priority, to the law of their last common nationality if one of them retains it, to the law of their common marital residence or to the law of the country to which they are most closely connected. These rules are fixed permanently at the time the marriage is solemnized.

Forced heirship. The Greek rules on forced heirship protect the closest relatives of the decedent, who may not disinherit them. Forced heirs are always entitled to a certain percentage of the estate, and they have all the rights and duties of other heirs. Forced heirs in general are the descendants, the parents and the surviving spouse of the decedent. If descendants survive, the parents are excluded, and the surviving spouse’s portion is one-eighth of the estate.

Forced heirs are entitled to one-half of their intestate share of the decedent’s estate. The forced heir’s right may be inherited and devolves under the rules of the intestate succession.

Any testamentary dispositions to the prejudice of the forced heir or any restrictions imposed on his or her share by the will are void. Inter vivos donations of the testator to the detriment of the estate and, consequently, to the legitimate portion are canceled if the estate at death is insufficient to provide the forced heirs their portions.

Under the provisions of Greek law, distribution of all property, movable and immovable, is governed by the law of the decedent’s country of nationality at death.

Driver’s permits. An expatriate may drive legally in Greece on his or her home-country driver’s license. EU citizens are provided with EU driver’s licenses, which they may use for up to one year. Non-EU citizens are provided with international driver’s licenses.

No examination is required to obtain a Greek driver’s license for holders of European or international driver’s licenses.