Key tax factors for efficient cross-border business and investment involving Greece.
|China||Rep. of Ireland||Portugal||UAE|
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For AE companies: EUR 24,000. For EPE companies: No minimum capital requirements exist. For IKE companies: EUR 1.
A company is resident either if it has been established in accordance with Greek law, or its registered address or its place of effective management is in Greece. Resident companies are taxed on their worldwide income. Nonresident companies are taxed only on their Greek source income.
Filing of annual income tax returns. Recording of entries in accounting books. Fiscal year is the calendar year or period ending on 30 June, unless majority foreign parent has different year end and opts to use this.
The standard corporate income tax rate is 29 percent
A 10 percent dividend WHT applies on distributed profits. An exemption from dividend WHT may apply if the EU Parent-Subsidiary Directive applies (based on the conditions mentioned below for inbound dividends) or could be reduced based on available double tax treaties. The EU Directive applies in relation to outbound dividends paid to EU entities if the following two conditions are met by the EU Parent Company:
A 15 percent WHT applies (exemption applies subject to certain conditions).
A 20 percent WHT applies (exemption applies subject to certain conditions).
Dividends are exempt (100%) if
The sale of shares by a Greek company is subject to Greek corporate income tax, subject to possible exemptions under treaties.
The carry-forward period for losses is 5 years.
Capital concentration tax of 1.1 percent applies on the nominal share capital for capital increases of Greek AE legal entities and 1 percent for capital increases of Greek EPE legal entities and on contributed capital of branches of non-EU resident entities.
0.2 percent stock exchange transaction duty applies on the sale/transfer of shares listed on the Athens Stock Exchange.
VAT is imposed on the transfer of new buildings (whose construction licenses were issued or amended after January 1, 2006) at the rate of 23%, on condition that they are to be used for the first time by the purchaser.
Following this first transfer, every subsequent transfer is subject to real estate transfer tax at the rate of 3%. A local authority surcharge, equal to 3% of the transfer tax, is also levied. For legal entities, capital gains from the sale of real estate are taxed as business profits at the standard tax rate.
The ownership of real estate is subject to the Unified Real Estate Ownership Tax (UREOT), which comprises a main tax and a supplementary tax. The main tax on buildings ranges from EUR 2 to EUR 13 per square meter depending on their location/tax zone, multiplied by certain coefficients depending on the building’s age, etc. The main tax for plots of land located within city limits or zoned areas ranges from EUR 0.003 to EUR 9 per square meter depending on their location/tax zone. The main tax for plots of land located outside city limits or zoned areas is EUR 0.001 per square meter, multiplied by certain coefficients depending on their use, whether they are irrigated, etc. The main tax is increased fivefold, if there is a building on such a plot of land. A supplementary tax is imposed on all real estate owned by legal entities at the rate of 0.5 percent of the objective tax value.
Yes. Intragroup transactions (domestic and cross border) should follow the arm’s length principle in accordance with the OECD guidelines. Profit adjustments may result.
Business transactions/transformations etc. should be supported by a valid and solid business rationale to mitigate risk that the tax authorities consider that a transaction is being carried out for tax avoidance purposes. Transfer Pricing, Controlled Foreign Company and Thin capitalization rules are applicable. There are no Anti-Treaty Shopping provisions.
Yes. Rulings can be obtained, but are not binding although they are generally adhered to by tax authorities. They are not subject to the payment of a fee.
Some investment incentives are available.
The standard rate is 23 percent (expected to be increased shortly to 24 percent). There are reduced rates of 13 percent and 6 percent for certain goods/services. The above rates are reduced by 30 percent for transactions performed in certain remote Greek islands in the Aegean sea, up to the end of 2016.
KPMG in Greece
T: +30 210 60 62 116