Income Taxes in Greece

Greek Tax Number (AFM)

No matter what type of visa or resident status you have in Greece, you will have to pay taxes from whatever income you have, local and foreign alike, except for the cases discussed in the section on tax exemptions below. Therefore, if you decide to relocate to the country, you need to get yourself a Greek tax number, officially known as AFM.

You can apply for it when you arrive in Greece or even while you are still in your home country. If you are already in Greece, you should go to the nearest office of the Internal Revenue Service, and you will do well to go there with an interpreter.

If you would like to get a tax number before you come to the country, you can apply for it on the IRS official website. Keep in mind though, that all pages are in Greek only. Alternatively, if you cannot speak the language and have nobody to help you with translation, you can visit the nearest Greek Consulate, and they will answer all your questions and help you fill out all the required application forms.

Exemptions and Deductions

Before we go into details of each category of taxes, let us briefly explain the circumstances in which you can apply for deductions or even be exempt from taxation altogether. To begin with, your foreign income will not be taxed at all, and you will not even have to declare it, if you stay in the country less than six months per year.

In addition, you become eligible to tax deductions up to 15% if you:

Make obligatory social security payments;
Pay a mortgage loan for your first real estate in Greece;
Make charity donations to any medical, educational or religious institutions in the country;
Pay in full for the lease of your Greek residential property.

On top of that, you will not have to pay taxes at all from the following sources of income:

International shipment of any commodities;
Capital gains from any business entity transfer between you and members of your family in Greece;
Sales and dividends on the Athens Stock Exchange;
Dividends from any officially registered enterprise in the country.

Double Taxation Treaty

Moreover, you can benefit from the double tax agreement that Greece has signed with nearly sixty countries around the world, including the USA and the UK. Basically, the treaty stipulates that if you are a national of one of the countries on the list, you will only have to pay taxes either in Greece or back home.

The agreement applies to income, capital gains and even some withholding taxes. You will only need to enquire with your lawyer or the Greek Internal Revenue Service whether you must pay taxes in Greece or your home country.

Greek Income Taxes

Essentially, this tax will depend on whether you earn your income as an employee or business entity, and in the former case, the IRS applies a progressive taxation system.

Personal Income Tax

If you are formally employed, the tax you have to pay will depend on your monthly salary. However, you will be exempt from taxation altogether if you earn less than 12,000 euros per month. Otherwise, your income tax will break down as follows:

Income Tax Rate (in %)	Salary (in euros per month)
18	12,000–15,999
24	16,000–21,999
26	22,000–25,999
32	26,000–31,999
36	32,000–39,999
38	40,000–59,000
40	60,000–99,999
45	100,000 and higher

Tax Reductions for Remote Workers

In line with the current international trend to welcome digital nomads to the country, Greece has decided to reduce income tax by 50% for this category of residents. This is a very good option to consider, provided you can find a way to make money remotely.

You will only need to obtain a digital nomad visa and agree to stay in Greece for at least two years. In that case, your income tax will be half the rates shown in the table above, and this reduction will be applicable for up to seven consecutive years, depending on your individual case.

Note: if you become a tax resident in Greece and invest 500,000 euros in the national economy, your foreign income tax will be set at 100,000 euros per year, regardless of your actual income.

Corporate Income Tax

On the other hand, corporate income tax in Greece is not progressive, set at the flat rate of 22% instead, whatever the organisational structure of the enterprise in question. Still, some legal entities, such as banks and other financial companies, are subject to a 29% tax rate, and you are best to consult your lawyer to find out the exact rate for your particular enterprise.

In addition, the Greek Internal Revenue Service treats corporate capital gains as regular income, but the maximum payable rate is set at 22%, and the national average corporate CGT is only 15%. This gives Greece a distinct advantage over most of the member states of the European Union, where capital gains tax for legal entities ranges from 19% to 34%, and only a few countries set it at less than 12%.

Rental Income Tax

Another fairly common category of taxation among foreigners in Greece is rental income tax. One of the currently most favoured ways to obtain a permanent residence status in the EU is to invest in the Greek real estate market, renting the purchased property out afterwards. The actual tax is progressive as well, breaking down as follows:

Tax Rate (in %)	Rental Price (in euros per year)
15%	12,000 or less
35% (of the amount above 12,000)	Up to 35,000
45% (of the amount above 35,000)	35,001 and higher

Social Security Tax

Both employers and employees in Greece also have to make social security contributions that amount to:

15.5% for employees;
24.56% of the monthly salary for employers.

However, the actual amount also depends on the employee's social security fund, and it can, in some cases, be reduced to 14.12% and 22.54% respectively. The tax amount will contribute to your medical insurance, pension fund and unemployment benefits.

Note: US citizens only need to make social security contributions either in the States or Greece, according to the Double Taxation Treaty between the two countries.

VAT

Value added tax is another kind of tax that the Greek government seems to be taking quite seriously. As a general rule, it breaks down as follows:

Super-Reduced VAT	6%	Theatres, bookshops, printed media
Reduced VAT	13%	Tourist and catering industry, street vendors, medical services
Standard VAT	24%	All other commodities and services

Note: international flights and marine passenger transportation are exempted from VAT.

Tax Payment Schedule

The table below shows the schedule that the Greek Internal Revenue Service sets for tax payments:

Income Taxes	Once a year
Value Added Tax	Once every four months
Social Security Tax	Once a month

Final Word

In this article, we have discussed the most common categories of income tax for foreigners in Greece. However, the Greek taxation system is very complicated and often confusing too. And the specific details of your individual taxation plan will also depend on your particular financial, legal and labour circumstances.

In addition, Greek laws change frequently, and new amendments to existing amendments are issued on a regular basis. For this reason, we suggest that you only read our article as a general review of the subject, and we refer you to your lawyer or relevant authorities for more up-to-date and specific information that will help you work out the optimal taxation scheme for your individual business purposes.