JT Law Sydney offices (in 2010)
One of the main taxes that are imposed on Greek real estate property, is the Greek conveyance tax. The reason for the imposition of the Greek conveyance tax is the exchange that the parties receive from a conveyance of real estate property. Since the establishment of the Greek State, there has always been a Greek conveyance tax of real estate properties with an exchange. Today, Law 1521/1950, after numerous amendments and changes, regulates the Greek conveyance tax on real estate property with an exchange. Greek conveyance tax on real estate property have come into effect by more recent laws (Law 2859/2000, Law 3427/2005), which regulate the conveyances of properties from a constructor or conveyances of properties acquired by the seller after January 1, 2006.
Pursuant to the provisions of Law 1521/1950 (as amended by law 3842/2010), subject to taxation is the conveyance of the Greek real estate property with an exchange, i.e. when the seller receives exchange (money or other) for the sale. Such exchange can be given either by immediate payment of the sale proceeds or by credit, or through the sale (exchange) of another property. As conveyance of properties it is considered the conveyance of ownership rights either by virtue of Notarial Deed or a Court's ruling, or the resignation of the owner of real estate property rights or through allotment of a property.
The tax value of the Greek property is the value that the property has (market value or "objective" tax value), at the time of the property's conveyance. In particular, the tax is calculated on the market value that is depicted on the conveyance Deed, and in case that this value is lower than the "objective" tax value, the tax is imposed on the (higher) "objective" tax value.
The Greek conveyance tax is estimated with the percentage of 8% for property value up to 20,000 euros and for the amount of the sale price exceeding the amount of 20,000 euros with the percentage of 10%. Additionally, there is an additional tax imposition of 3% on the above tax in favor of the Greek Municipalities. In cases of distribution of properties, the above percentages are decreased to 1/4, while the tax is reduced to 1/2 in cases of properties' exchange.
Greek conveyance tax burdens the purchaser, while the purchaser and any third party in possession of the property are liable for five years after the execution of the conveyance Deed.
Several exemptions exist for the Greek conveyance tax. One of the most important exemptions of the Greek conveyance tax is the exemption of "first home residence", which is granted in case that the purchaser, his spouse and their minor children do not have rights of full ownership, life estate rights or rights of habitation on another house or apartment which can cover their housing needs; even in case that they have not ownership rights on a buildable plot, where a house that will cover the housing needs of the family can be built. This Greek conveyance tax exemption is granted only once and applies for a single person for conveyance up to 200.000 € and 250.000 € for a married person, while this amount is increased by 25.000 € for each of the first two children and by 30.000 € for the third child and etc. The above exception is granted not only to Greek citizens but also to citizens of the European Union, recognized refugees, citizens of Albania, Turkey and from the U.S.S.R. with Greek origin, and to citizens of third countries (other than E.U. members) with long stay in Greece. As Greek lawyers specialized on real estate conveyances, we undertake all necessary registrations, so our clients enjoy the most out of the tax exemptions provided. The Competent Tax authority for the submission of the conveyance tax statement in Greece is the tax authority of the property's location.
Copy of the submitted Greek conveyance tax statement, as well as copy of the receipt of payment of the tax imposition, is necessary for the Notary Public, in order for him to be able to proceed with the execution of the conveyance deed. The Notary Public is prohibited from executing a conveyance deed, if a time period of more than three months has passed since the execution of the Greek conveyance tax statement.