Greece has captured the attention of both tourists and investors with its breathtaking landscapes, rich history, and vibrant culture. In particular, the country’s flat tax regime has solidified its position as an attractive destination for foreigners seeking tax-efficient residency options.
Our 2023 guide on Greece’s flat tax regime for foreigners provides a comprehensive understanding of how the regime works and offers detailed information on the application process.
Our team at Nomad Capitalist is committed to guiding individuals, like yourself, through the complexities of international tax laws. We specialize in identifying optimal and legal strategies to reduce your tax burden. If you’re interested in Greece’s flat tax regime or exploring tax-efficient solutions in other EU countries, don’t hesitate to contact us today to learn more.
A Glimpse into Greece: A Brief Overview
Greece, a southeastern European gem, is a country steeped in ancient history and brimming with vibrant culture. Located at the junction of Europe, Asia, and Africa, Greece offers an enchanting blend of stunning landscapes and a rich historical heritage.
The country shares land borders with Albania, North Macedonia, Bulgaria, and Turkey, providing it with a strategic geographic advantage.
As part of the European Union, Greece offers its residents numerous benefits. They include access to the Schengen Area, a high standard of living, and a steadily growing economy.
Greece also offers an enticing climate and an appealing tax regime. These make the country an increasingly popular destination for investors and foreigners seeking an ideal mix of business opportunities and a decent quality of life.
Exploring Greece’s Investment Potential: A Land of Opportunities
Thanks to its pleasant climate and welcoming atmosphere, Greece has become a favorite destination for professionals in recent years. As a member of the European Union, the country offers the stability and advantages associated with EU membership.
Indeed, Greece is an attractive location for investors seeking fresh opportunities.
Greece’s robust tourism industry, strategic location, and steadily improving economy provide a solid foundation for investment and growth.
However, one of the main reasons why investors are drawn to Greece is its flat tax regime, which offers a competitive edge for those seeking tax-efficient residency options.
Later on, we will explore the details of Greece’s flat tax regime. We’ll take a look at its benefits for foreigners who are considering investing in this beautiful Mediterranean country.
Alternative Taxation Regime in Greece
So what is a flat tax regime? This is a tax program where everyone pays the same tax rate, regardless of income. Sounds simple, right? Well, not quite. There are different types of flat tax regimes, and some of them may be more appealing to you than others.
If you are a high-net-worth individual who wants to relocate to Greece, you may be interested in their alternative tax residency regime for foreign-sourced income. This regime allows you to pay a flat annual tax of €100,000, regardless of how much you earn abroad.
This makes sense if you earn more than €1 million a year, as the normal tax rates in Greece can go up to 45%.
The good news is that this regime applies for 15 years, longer than in Portugal or Italy, and no physical presence is required. You can enjoy the benefits of living in Greece without spending more than 183 days a year there.
You can also include your spouse and children under this regime for an additional €20,000 per person.
The bad news is that you will not be exempt from Greek inheritance tax or Greek gift tax for movable property located abroad. This means that if you pass away or transfer your assets to someone else, they may be subject to taxation in Greece.
You also need to apply for this regime before the end of the tax year and pay the flat tax in advance.
Another option for retirees who want to move to Greece is the alternative tax residency that taxes foreign pension income at a flat rate of 7%. This retirement visa only applies to pensioners from countries with which Greece enjoys double taxation treaties.
You need to apply before March 31 of the relevant tax year and submit supporting documents by May 31. You also need to pay the flat tax in one installment before the last working day of July.
Both of these regimes are attractive for nomads who want to enjoy the Mediterranean lifestyle and culture without paying high taxes on their foreign income. However, they also come with some drawbacks and limitations that you need to be aware of before making a decision.
If you want to learn more about how to become a tax resident in Greece or other countries, contact us today and we will help you create a bespoke plan that suits your needs and goals.
Greek Flat Tax Regime Application Process 2023
Requirements for Alternative Tax Residency Regime for High Net Worth Individuals
Under this regime, you, as a Greek tax resident, will pay a flat tax of €100,000 per tax year regardless of the amount of income.
Additionally, you need to invest at least €500,000 to qualify for this special tax regime. The investment can be an apartment, a house, legal entities based in Greece, or securities/bonds/funds of Greek entities or the Greek state.
You need to continue to hold this investment and not liquidate it. For each relevant tax year, you need to file evidence showing that you are still the owner of that investment.
For this type of residency, the following documents are required:
- Receipt of tax registration number and application for inclusion in the regime
- A copy of your passport
- A notarized and apostilled Power of Attorney (PoA) or, if you are in Greece, an authorization signed before a relevant municipality center of serving citizens, to include a statement that you meet the requirements of the applicable tax law and that you commit to invest €500,000 within three years in Greek assets or provide proof that the investment has been carried out in the year you apply to become a tax resident
- In case you want your spouse or parents, or adult children to be included (for an additional €20,000 flat annual tax per person for whatever their income earned abroad during the respective tax year), a solemn declaration signed by them before a notary or the authority indicated above ,that they wish to be included
- In the case of the above, apostilled kinship certificate (family relation certificate)
- Foreign tax residence certificates for previous years if you have lived during any of the prior seven years in Greece.
Alternative Tax Residency Regime for Pensioners Relocating to Greece Requirements
The following three eligibility criteria will apply to you as a pensioner from abroad to switch tax residence to Greece with a flat income tax rate of 7% for the next ten years:
- You should have been a Greek tax resident for at most one of the last six years
- You must shift your tax domicile from a state with which Greece has a valid double taxation agreement
- You need to prove pension income earned from abroad via your foreign social security institution, another public authority, professional fund, or insurance company that illustrates the payment of a state or private pension abroad.
For this type of residency, the following documents need to be presented:
- Receipt of tax registration number and application for inclusion in the regime
- A copy of your passport
- A notarized and apostilled PoA for representing you regarding the signing and filing of the application and receiving your Greek tax registration number
- A statement from you, included in the PoA, about your current tax residency country
- A certificate issued by the legal entity, which is the payer of the pension, must be apostilled (and notarized if the payer of the pension is not a state agency), certifying that you are the beneficiary of a pension
- Foreign tax residence certificates if you have been living during any of the prior five years in Greece.
Greek Flat Tax Rate FAQ
Generally speaking, yes, all taxes on income earned are progressive. So, when you make a higher income, the income tax rate will increase.
However, tax reform has created a situation where foreign pensioners are subject to less tax liability on their foreign income if they come from a country that enjoys a double taxation treaty with Greece.
The issue of this certificate for Greek tax residents involves two phases:
Phase 1:
Request from the competent tax authority for the issue of a certificate, in which it will be certified that you are taxed in Greece on your worldwide income. Suppose the foreign source income tax return filing deadline (i.e., 30 June of the following year) has yet to pass. In that case, you will need to file a statutory statement, signed before a notary public and apostille, stating that you fully comply with the relevant tax return filing obligations and the timely payment of the tax.
Phase 2:
Submission to the Department of International Economic Relations of the tax administration of the alternative taxation certificate, in which it must be explained the purpose for which the tax residence certificate is needed, including the country where the relevant foreign source income item is earned and why it is necessary in respect of that country.
In Conclusion: Embrace the Opportunities in Greece
Greece’s flat tax regime presents a compelling opportunity for foreigners seeking tax-efficient residency in an attractive destination. With its rich history, beautiful landscapes, and a growing economy, Greece offers an ideal blend of business and leisure for investors and expats alike.
We hope this ultimate guide has provided you with valuable insights into the benefits of Greece’s flat tax regime for foreigners.
At Nomad Capitalist, our team of experts is ready to help you navigate the complexities of international tax laws and identify the best strategies to legally reduce your tax burden.
If you’re considering Greece as a potential investment destination and would like to learn more about your options, please reach out to us at Nomad Capitalist. We’re here to help you unlock the opportunities that await you in Greece and beyond.
