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11 February, 2022

Taxes on property, gifts and business income in Greece: changes in 2022

Starting January 1st, 2022, there are new “objective values” for real estate that affect taxes when buying and owning properties in Greece. Gift tax is now levied on the amount of €800,000, and corporate tax and VAT rates have been reduced for businesses.

The information about changes will be useful for Greek tax residents and those who are considering buying property in the country.

Photo: Adobe Stock

Regions where the transfer tax sum may increase

In December 2021, the Greek Ministry of Finance set new so-called “objective values” of prices per square meter in 13,808 property zones of the country. These values are used when calculating an amount of the transfer tax, which is paid by a buyer of Greek real estate.

In 7,000 zones
taxable price per square meter of real estate has increased

The objective price per square meter has increased by an average of 50% in 7,000 zones. Real estate on the island of Ithaca rose the most: from €600 to €2,100 per square meter, or by 250%.

10 zones where the objective value per square meter has grown the most in 2022

ZonePrice per sq. m. before December 31st, 2021Price per sq. m. from January 1st, 2022Growth in percentage
Ithaca€600 €2,100+250%
Mykonos€1,200€3,950+229%
Rhodes€700€2,100+200%
Kos €650€1,350+108%
Kassandra, Chalkidiki€800€1,550+94%
Lagonissi€750€1,450+93%
Kefalonia €700€1,250+79%
Heraklion€600€1,050+75%
Dafni, Athens€1,000€1,750+75%

In 1509 zones, the objective value per square meter has been reduced. For example, in the city of Penteli in the metropolitan region of Attica, the cost per square meter fell by 20%. And in the city of Florina, by 50%. 

Examples of zones where the objective value per square meter has been reduced in 2022

ZonePrice per sq. m. before December 31st, 2021Price per sq. m. from January 1st, 2022Reduction in percentage
Florina€600 €300-50%
Chios€800€450-44%
Penteli €1,750€1,400-20%
Orestiada €500€400-20%

Current values are shown on the interactive map. To find out the value per square meter in any zone, you need to enter the address or postal code of the region in which the property is located in the search bar of the map.

The new value of a square meter is applied for tax calculations under real estate purchase and sale agreements concluded and registered on the myProperty platform from February 1st, 2022.

If the sale and purchase agreement is concluded and registered before February 1st, 2022, the transfer tax is calculated on the old objective values.

The transfer tax rate has not changed. It is fixed at 3%.

3%
the transfer tax rate in Greece

The recalculation of objective values will not affect the cost of transactions with elite real estate. The transfer tax is calculated either on the cadastral value of the object, or on the purchase and sale agreement depending on which of the amounts is bigger. The market price per square meter of luxury real estate is usually higher than objective values, so the amount of tax for the buyer will not increase.

Natalia Oganesyan - Immigrant Invest
Natalia Oganesyan,
the Real Estate Chief Operations Officer at Immigrant Invest, a RICS certified professional
Residence permit in Greece for the purchase of real estate: tax on the transfer of ownership
A townhouse of 171 m² in a new resort in Heraklion costs €570,000. The price per square meter is €3,300, three times bigger than the new objective value of €1,050. The transfer tax on this property will be charged at the market price and will amount to €17,100

How much taxes will property owners pay?

The annual property tax in Greece, ENFIA, is calculated on a progressive scale from €2 to €13 per square meter. The date of construction of the object, area and cadastral value are taken into account.

ENFIA rates also depend on the objective value per square meter in the zone where the property is located. In 2022, ENFIA rates will decrease for properties whose objective value per square meter is up to €2,500.

Comparison of annual property tax rates considering the objective value per square meter

Objective value per square meterTax rate in 2021, per sq. m.Tax rate in 2022, per sq. m.²
Up to €1,050 €2.9€2
€1,051 to €1,500 €3.7€2.8
€1,501 to €2,000€4.5€3.7
€2,001 to €2,500€6€3.7

How the rates for real estate in the more expensive regions of Greece will change is not yet specified.

Greek taxpayers will receive invoices for ENFIA at the new rates by the end of April 2022. The tax must be paid by the end of May. The next time the tax will be charged in ten months with a payment deadline until the end of February 2023.

On February 2nd, 2022, Greek Prime Minister Kyriakos Mitsotakis announced a future reduction in ENFIA payments by 13%. Thus, the government expects to compensate for the rise in values per square meter and electricity.

By 13%
the ENFIA payments are planned to be reduced
Residence permit in Greece for the purchase of real estate: annual property tax, ENFIA
A 120 m² apartment in Thermi. The city is located in the zone of the objective value per square meter of €1,050. According to the new scale, the ENFIA property tax will be calculated at a rate of €2 per square meter and will amount to €240 per year

Gift tax threshold increased fivefold

From October 1st, 2021, if the value of a gift to a close relative is up to €800,000, it is tax-free. From €800,000 for a gift, you need to pay a tax at a rate of 10%. Prior to this, gifts worth €150,000 or more were taxed.

Up to €800,000
can be gifted to close relatives without paying taxes

The rule applies to gifts to relatives of the first category: spouses, children, grandchildren and parents of the donor.

The gift can be a thing or money. Cash gifts must be given by wire transfer through a financial institution, such as a bank. Otherwise, the gift is taxed at a rate of 10% from the first euro.

How much tax rates are reduced for legal entities

Corporate income tax is now levied at a rate of 22% instead of 24%. If a business has been affected by coronavirus restrictions in the country, the advance payment of corporate tax is reduced by 75%.

22%
the reduced corporate tax rate

VAT is reduced for certain goods and areas of activity:

  • 13% instead of 24% for gyms, swimming pools and dance schools, soft drinks, transportation of passengers and luggage, imports of art and antiques, cinema and zoo tickets;
  • 6% instead of 13% for medical devices, personal care products, virus protection products, and animal feed.

The merger and acquisition exemption is presented in the form of a 30% tax rebate. The discount is valid for three years.

How to become a Greek tax resident

Company owners optimize their business taxation when they register their headquarters or a branch office in Greece. Individuals can change their tax residence to Greek if they live in the country for at least 183 days per year. For this, a visa is not enough, you will need a residence permit.

A residence permit in Greece can be obtained by investment:

€250,000+
a purchase of real estate or land, renting a hotel or timeshare for 10 years
€400,000+
a purchase of securities or opening a deposit in a Greek bank

Holders of a Greek residence permit card can live and do business in the country without restrictions. They also travel visa-free in the 26 Schengen states.

If an investor with a residence permit card moves to live in Greece and spends more than 183 days a year in the country, he will be able to change his tax residence and receive tax benefits on global income. In seven years he will be able to apply for citizenship.

Immigrant Invest is a licensed agent that helps investors obtain a residence permit in Greece. If you want to buy real estate and become a resident of a European country, please contact investment program experts for advice.

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Taxes on property, gifts and business income in Greece: changes in 2022