The new Greek tax law — Impact on Greek Australians

Ta Nea, January 21, 2013

On January 11, 2013, the Greek Parliament in its pursuit to increase tax  scrutiny and revenues has voted the new tax law. This tax reform changes significantly the taxation of Greek citizens, as well as the taxation of foreign residents, who are subject to income taxation in Greece. The main changes, concerning Greeks residing abroad, include the following:

  • Foreign residents/ Greeks residing abroad, having, not only actual  but even presumed income in Greece (“tekmiria”, such as maintaining a residence, buying property etc)  should be filing a tax statement. Their  appointed tax representative is jointly and severally responsible with them for the submission of their tax statement.
  • Foreign residents/ Greeks residing abroad, that are liable to payment of income tax in Greece (through e.g.  collection of rents, pensions, etc…), are not entitled to the reductions provided for Greek residents, such as the collection of tax receipts, receipts for medical expenses, gifts to churches, to non profitable institutions, etc.
  • Rents collected are taxed on a separate tax scale. For rents up to 12.000€, the tax payer is taxed by 10%, while for amounts exceeding 12.000 €, the tax rate is 33%. Additional tax of 1,5% or 3% (for business leases and for properties over 300 sq.m.) is imposed on the gross rental income.
  • Property conveyancing (sale, parental gift, inheritance, etc.) either in full or in undivided interest shares, effected after January 1, 2013 is subject to a 20% capital gains tax. The tax is imposed on the difference between the value that the property had at the time of acquisition and of the value of the property at the time of the disposal.
  • With regard to the property tax (“haratsi”) that is collected through the power supply (“DEI”)  bills, the owner of the property can request the disconnection of the tax from the electricity bills and its direct payment to the tax authority (avoiding the tenant’s deduction from the monthly rent, in case that the property is rented).
  • Last but not least, a new imminent obligation: Owners of plots outside the city limits or the urban plan (“ektos shediou”), must declare the details of their properties, electronically, through the Greek Ministry of Economics’ web page. The deadline for such amendments expires on June 30, 2013.

On a different but very serious issue, we remind that the obligation for submitting documents proving the residency and taxation outside Greece, has been extended through to March 29,2013

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