Having covered several nation’s tax circumstances in-detail, we now aim to focus in on how property tax checks out in Greece. In this short article we will look at many different topics around property tax. These topics will include the following. Transfer tax, rental tax, capital gains tax, annual property taxes, ENFIA, TAP, special tax on property, and taxes on exit. Nonetheless, let’s get started with the concept of transfer tax in Greece.
The tax rate in Greece for transfer tax is 3.09 percent of whatever the value of the property is. In the case of objective value, in which the value of the property is estimated based upon its size, where it’s based and other technical aspects of the property. If the value is higher than the price, you can choose to pay tax on that instead.
As with most countries, if you’re renting out a property, you’re required to pay tax based upon your rental income. If you’re earning €12,000 from renting, the rate of tax is 15 percent. If it is anything between that and €35,000, the rate is 35 percent. If it’s more than €35,000 then the rate peaks at 45 percent.
It’s vital that you declare your income truthfully. Greek authorities are very strict. They go to great measures to keep track of those who are renting our properties. If you fail to properly declare your earnings then you may end up penalized.
For those who are earning rental income as a corporation, then the rate is 29 percent with a 15 percent dividend WHT also coming into consideration.
Capital Gains Tax
In Greece, if you own a property for less than five years, and sell it, you’re then required to pay 15 percent in taxes on any profit you make from the sale. Yet, if you own the property for longer than the five year period, you’ll be exempt from this tax.
If you’re a non-resident of Greece, yet still own property in the country and are selling it, then you may be subject to a higher rate of capital gains tax than if you were a resident of the nation.
Annual Property Taxes
This form of annual taxation is also known as ENFIA. Your options in terms of going about paying this fee are in two ways. You can choose to pay your annual taxation fee in one large lump sum. You can also choose to pay it in five different instalments throughout the at any point between September and January.
The fee you are required to pay based upon the value of your property on the 1st of January. There are two separate tax amounts when it comes to ENFIA taxation, they are the following:
Primary Tax: This tax is required to be paid on each property you own. In terms of how the figure for this taxation is determined there are several factors. It can be based upon the price zone, surface of the property, the age of the property, how much of the property you own as an individual and other factors too.
Secondary Tax: If your property value is greater than €200,000, then secondary tax IS required for you as the owner. The range of the rates for this taxation is between 0.1 percent and 1.15 percent.
TAP (Telos Akinitis Periousias)
Telos Akinitis Periousias is a municipal tax. This taxation is taxed at a rate of 0.025 percent all the way to 0.035 percent based on the value of the property in question. This form of taxation is usually charged through the likes of electricity bills. That’s to say it is mandatory and imposed upon the owner of the property. If the bills of the home are being issued in a tenant’s name then the amount that they are charged is taken away from the fee they pay for their rent.
Special Tax on Property (SRET)
If you own real estate through association in a company, then you are required to pay this fee. If the company has zero exemptions, then they’re charged annually a rate of 15 percent of the total value of the property in question. Yet, there’re exemptions from this taxation, as mentioned in the following points:
- If the company has registered shares that trace back all the way to an individual person at the top of the company. If the individual is a resident in Greece or another nation, they must be able to have a Greek tax registration number to take up this exemption.
- If a company is owned by a bank or institutional investors then they’re not required to speak on who their ownership includes.
- A shipping company that has offices set up within Greece for the property that they’re renting or making use of.
- All companies that have their public shares enlisted upon the organized stock exchange.
- Companies that are working in the following areas. Manufacturing or industrialization, or commercial activities. To avail of this exemption if your company meets this description your earnings from these activities must be higher than that of the property owned.
- Legally set-up companies that are making use of buildings for the use of charity-reasons, cultural, religious or educational purposes too.
- Insurance companies or social-security companies. To avail of the exemption if you meet these descriptions you must be supervised and regulated by an outside authority.
Taxes on Exit
All non-listed shares transfers done by Greek businesses and companies are required to pay the 29 percent income taxation upon the income they earn from such companies. The two exceptions to this rate are as follows:
Those who are a tax-paying resident in another nation of which Greece has a double taxation agreement with.
Non-Greek entities who are not pursuing or maintaining a fixated living abode within Greece.
For more information, please refer to our ultimate guide on Buying Property in Greece.