Greece

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Tax Policy

TAX POLICY

Income Tax Rate -45%

Corporate Tax Rate – 24%

Sales Tax / VAT Rate - 23%

Tax on an individual's income

All tax on an individual's income in Greece is progressive. As of 2011, a Greek individual is taxed at a rate of 18% - 45%.

Exemptions are granted to taxpayers with specific types of income.

An individual in Greece is liable for tax on his income as an employee and on income as a self-employed person. In the case of an individual who answers the test of a "permanent resident" of Greece, tax will be calculated on his income earned in Greece and overseas.

An employer is obligated to deduct, immediately, each month, the amount of tax and national insurance due from a salaried worker.

A self-employed individual is obligated to make advance payments on income tax that will be offset on filing an annual report. In the case of a new business, the advance payments will be calculated according to the estimates of the owner of the business. The advance payments are payable three times a year.

Certain payments are deducted from taxable income as detailed below.

Greece individual income tax rates 2011

Tax %

The Tax Base (EURO)

0

1-12,000

18

12,001-16,000

24

16,001-22,000

26

22,001-26,000

32

26,001-32,000

36

32,001-40,000

38

40,001-60,000

40

60,001-100,000

45

100,001 and over

For salary and pension income the first EUR 12,000 are tax exempt.

Corporate tax

In 2011 the standard rate of corporate tax in Greece is 24%. For accounting periods ending after 31.7.2011, the tax rate is 20%. For Greek partnerships the tax rate is 25%.

Other deductions

Tax must be deducted at source from the following payments to non-residents on the basis of the following:

Dividend - 21% (25% from 2012)

Interest - 40%.

Royalties -25%.

Reporting Dates and Payment

The tax year in Greece is the year ending on December 31st. Advance payments of tax are made as specified below:

An Individual - An individual whose income is only from a wage is not obligated to file an annual return. The employer deducts tax from the employee and transfers it to the tax authority every month.

The return must be filed by March 2nd after the end of the tax year.

During the course of the year, the company must make advance payments every three months. A delay in submitting the returns beyond the prescribed date is liable to a fine.

VAT Rates

The standard VAT rate in Greece is 23% (from July 2010). There is a reduced rate of 13% (from Jan 2011) for: food and drink; pharmaceutical products; passenger transport; and other. There is also a 6.5%% VAT rate (from Jan 2011) for: hotel accommodation; medicines and vaccines; children’s books; newspapers; and other.