Corporate income taxes applying to Greek resident corporations and foreign enterprise permanent establishments in Greece (branches) are currently set at 29%.
The withholding tax on dividends paid to shareholders/partners is 15%, unless a reduced rate applies by virtue of the applicable bilateral treaty (see Withholding Taxes, below).
Greece has comprehensive bilateral treaties for the avoidance of double taxation with 57 countries generally covering corporate and personal income taxes, capital gains, and transfer taxes on the sale of Greek participations. Greek Tax Legislation permits the allowance of a tax credit in respect of taxes sustained overseas even for countries with which there is no bilateral treaty.
Profits arising from the transfer of shares (listed and non-listed) and partnership parts are treated as business income for legal entities disposing of the shares and taxed at the corporate tax rate (currently 29%). This tax does not apply to nonresident entities with no permanent establishment in Greece.
The transfer of shares (listed and nonlisted) by individuals is subject to capital gains tax at the rate of 15%.
The transfer of shares remains, in most cases, a simple procedure, unlike the transfer of partnership parts, which requires a Notarial Deed and often an amendment of the Articles of Association of the EPE as well as registration in the Registry and finally publication in the Government Gazette.
VAT is currently set at 6% to 24% depending on the location and the category of the goods.
Investment incentive legislation provides for government grants, tax-exempt corporate bond loans and tax-free mergers.
Incentives are provided to Energy
Production Enterprises, Leasing Companies, Constructors and Operators of airports, highways, bridges and metros,
Engineering and Civil Construction
Companies, Scientific Research
Enterprises, Venture Capital and Investment Companies, and Exporters.
Profits derived by Greek shipping companies from the operation of fleets registered under the Greek flag and vessels that are not registered under the Greek flag but are managed by a management company operating from Greece are taxed based on gross tonnage and vessel age less certain tax credits allowed. This tax is deemed to satisfy the income tax obligation of the ship-owning company and its shareholders in respect of all operating net income, vessel disposal gains and settlement of insurance claims.
All individuals domiciled in Greece are subject to income tax in Greece on their world-wide income, regardless of their citizenship, nationality or place of residence. In addition, income generated in Greece is subject to income tax irrespective of whether it is earned by residents or non-residents. Domicile may be defined as the intent of a person to settle in Greece. Such intent is apparent from the person’s residence, location of family, centre of activities, etc.
All allowances and benefits in kind received by an individual should be declared as part of one’s annual income which will be taxed accordingly. Therefore, for the individual there is no tax difference between allowances and benefits in kind.
Husband and wife file a joint tax return on which income is declared separately. The tax is calculated separately for each spouse. When one of the spouses is domiciled in Greece he/she is taxed for his/her income earned in Greece.
Income from salaries and wages is subject to PAYE taxation. The income taxes on the above income are estimated and withheld monthly. The current income tax scale for employment income is set out overleaf:
|Income Tax Bracket (€)||Income Tax Rate (%)|
|0,00 – 20.000,00||22%|
|20.000,01 – 30.000,00||29%|
|30.000,01 – 40.000,00||37%|
The above income is net of employee social security withholdings. There are also certain tax credits allowed which, however, have been limited significantly. In addition to the above tax there is an extraordinary tax contribution ranging from 0% to 10% depending on the level of total annual income.
The supervising authorities consider the transfer pricing legislation to be in line with OECD guidelines. Intra-group transactions should follow the arm’s length principle. For each tax year, a Transfer Pricing Documentation File supporting the appropriate transfer pricing method must be prepared and a Summary Information Sheet must be submitted (both within 6 months from year-end).
Fines are imposed if a company does not comply with the relevant transfer pricing documentation and filing obligations.
Companies may obtain an Advance Pricing Agreement (APA) covering the transfer pricing methodology of specific cross-border intra-group transactions for a certain duration. Special rules and conditions apply.
Administratively, an EPE is monitored by the District Tax Authorities whilst a Société Anonyme [AE] and branches of foreign entities are monitored by the Central Tax Authorities for Sociétés Anonymes, which therefore deal with the Greek fiscal affairs of many multinational groups.