Incentives for foreign retirees to be transferred in Greece

According to a recent draft Law, at a rate of 7% will be taxed independently each year and for 10 years the income earned abroad by foreign retirees who choose to move their tax residence in Greece. With the payment of this tax, every tax liability of the natural person for this income shall be exhausted. In order for a foreign retiree to be subject to this regime, the following conditions must apply cumulatively to income earned abroad:

a) the applicant must have not been a tax resident of Greece for the previous five of the six years prior to the transfer of his tax residence to Greece, and

b) the applicant to transfer his tax residence from a state with which an agreement on administrative cooperation in the field of taxation with Greece is in force.

The tax at a rate of 7% shall be paid each tax year in one installment until the last working day of July and it is not offset by other tax liabilities or any credit balances of the person who has been subject to this regime. The application for the transfer of the tax residence shall be submitted to the tax authorities until March 31 of the respective tax year. Within sixty days from the submission of the application, the tax authorities shall examine the application and they shall issue a decision, either approving or rejecting it. Especially for the applications for transfer of tax residence that they will be submitted within the year 2020, the deadline for submission of the relevant application is set at 30.09.2020. The provisions also apply to natural persons who meet the conditions and have already transferred their tax residence in Greece within the previous tax year. In this case the tax shall be paid within thirty days from the approval of the taxpayer’s application. The application of this incentive shall start from the next tax year for which the natural person submits the application for inclusion in the provisions of the present regime and it shall end after the end of ten tax years. This regime may not be extended beyond 10 years.

Also, the issuance of a joint decision of the Minister of Finance and the Governor of the Independent Public Revenue Authority is envisaged, which shall determine the procedure for the transfer of the tax residence and the subordination to the provisions hereof, the department responsible for submitting, examining and approving the application, the supporting documents accompany the application, its revocation, the payment of the tax, the submission of the income tax return, as well as any other necessary issues or details for the application of the provisions of the law.

Finally, it is clarified that the taxpayers who shall be subject to the provisions of this regime shall be obliged to declare both their incomes that arise in the country, as well as those that arise abroad.


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