Are you interested in saving money on your taxes in Greece as an Expat? You’re in luck! The Greek Special Expatriate Regime (“Non-Domiciled Tax Regime”) was introduced by the Greek government in January 2022. This tax incentive program was designed to attract high-net-worth individuals and professionals to live and work in Greece.
Today, we will explore everything you need to know about the Greece Non-Dom Tax Regime. So, let’s jump right in!
Table of contents
- Understanding the Greek Non-Dom Tax Regime for Expats
- Eligibility Criteria for Greece Non-Dom Tax Regime
- Categories for the Special Expatriate Regime
- How to Apply for Non-Dom Tax Benefits in Greece
- Key Benefits of the Greek Expat Tax Regime
- Frequently Asked Questions About The Greece Non-Dom Tax Regime
- Conclusion: How Lexidy Helps Expats Obtain Non-Dom Tax in Greece
Understanding the Greek Non-Dom Tax Regime for Expats
The Non-Dom Tax Regime in Greece offers favorable tax treatment for individuals who meet the eligibility criteria.
Under this regime, expats and foreigners who qualify as “non-domiciled” in Greece can benefit from the following tax advantages:
- Investors’ special treatment by applying a tax flat rate.
- Reduced Tax: up to 50% on the income of employees and sole proprietors who are changing their tax residency to Greece
- Tax flat rate on pension: Pensioners from foreign countries receive a flat tax rate by changing their tax residency
These advantages are especially attractive to high-income expats and foreigners as well as their families. The special flat rate of tax is favorable when compared to the typical tiered tax system that results in high-income individuals paying upwards of 40% on tax in many countries, with no limit.
Eligibility Criteria for Greece Non-Dom Tax Regime
So now that you know about the benefits of this tax relief scheme, you want to know if this scheme is for, and more importantly if you’re eligible for non-dom tax benefits in Greece. Let’s take a look at the criteria for eligibility.
High Net-Worth Individuals and International Businesspeople
Expats conducting international business activities or investments may find this scheme beneficial because it will allow them to minimize their tax liability in Greece on foreign income through investment.
Professionals and Expatriates
Professionals working in Greece, or foreign nationals who are considering working in Greece can also benefit from this scheme because it offers them more favorable tax treatment on their salary taxation, their income, and their assets.
Foreign Retirees
Foreign retirees who choose to retire in Greece and meet the eligibility criteria can benefit from reduced taxes on worldwide income and may also lower their overall tax burdens.
Think you may be eligible? The team at Lexidy is here to help! Just reach out to our experts specializing in Greek taxes and immigration to book your free consultation today!
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Categories for the Special Expatriate Regime
The Greece Non-Dom Tax Regime is broken down into several categories, each with different tax treatments depending on your specific circumstances. The tiers or categories were designed to cater to various types of expats and non-dom individuals. Here is a breakdown of the existing categories:
Category A: Special Provisions for Investors
This category provides tax incentives for investments in certain Greek assets and economic activities. It was introduced to attract investors to Greece.
Who is eligible?
To be eligible for Category A, individuals must:
- Not be a tax resident of Greece for the previous 7 out of 8 years before transferring tax to Greece
- Transfer their tax residence from a state with which an agreement on cooperation within taxation with Greece is in force (eg. Double Taxation Treaty/Bilateral Agreements).
And
- Provide evidence that he/she invests him/herself or a related person, or through a legal entity through which he/she has a majority of the shares or interests, in:
- Real estate
- Business
- Movable property securities
- Shares or interests
- The investment must be at least €500,000 and be completed within 3 years from the date of submission of the application for the special expat treatment.
If the investor already holds a residence permit for investment purposes, the second condition is not necessary.
Time frame for Category A
The application must be submitted from the beginning of the investment period and up to 3 years following the completion of the investment. The investments that are made for the application of the Non-Dom Tax Regime must not have been made before the 12th of December 2019.
Tax to be Imposed
Regardless of the investors’ worldwide income, they will be subject to a €100,000 lump sum taxation each year. This is to be paid to the Greek state for 15 years.
An additional €20,000 is chargeable for each relative willing to be considered as receiving special tax treatment under this scheme.
Category B: Pensioners
Category B is catered towards retirees receiving pensions from abroad. This category offers certain tax benefits for foreign pension income.
Who is eligible?
To be eligible for Category B, individuals must:
- Not be tax residents of Greece for 5 of the previous 6 years prior to the transfer of their tax residence to Greece.
- Transfer their tax residence from a state with which an agreement on cooperation within taxation with Greece is in force (eg. Double Taxation Treaty/Bilateral Agreements).
Time Frame for Category B
The application must be submitted up to the 31st of March of each tax year.
Tax to be Imposed
For pensions arising abroad, the pensioner will have to pay a flat tax rate in Greece each year. This rate amounts to 7% of the total income that is generated from abroad. These tax provisions are valid for 15 tax years.
Category C: Professional Activity
Finally, Category C applies to employees who are covering a new position in a company established in Greece and/or to sole proprietorships.
Who is eligible?
To be eligible for Category C, individuals must:
- Not be tax residents of Greece for 5 of the previous 6 years before the transfer of their tax residence to Greece.
- Transfer their tax residence from a state with which an agreement on cooperation within taxation with Greece is in force (eg. Double Taxation Treaty/Bilateral Agreements).
- Be earning income through one of the following occupations:
- Private Employees
- Lawyers under fixed remuneration contracts
- Paid members of the BoD
- Administrators
- Sole proprietors
- As employees, they must be covering a new position or vacancy in a company
- Be willing to stay in Greece for at least 2 years.
Time Frame for Category C
This tax regime lasts for up to 7 years, granted the applicant maintains the employment contract of the activity agreed in the application. The period that the applicant has to apply is as follows:
- If you started your employment before the 2nd of July: You must submit the application before the end of the same year for the tax scheme to be applicable on the same year;
- If you started after the 2nd of July: You have until the end of the next year and the tax scheme will be applicable for the next financial year.
Tax to be Imposed
You receive a reduction of tax on your income (salary or net income from professional activity) for up to 50%, applicable for 7 years.
You will also be exempt for 7 tax years from the annual objective tax expenditure, which is based on residence and passenger cars for private use.
These are the typical implications and requirements for the various categories, however as time goes on, there may be changes to specific aspects of the tax scheme, so be sure to work hand-in-hand with well-informed lawyers and accountants to avoid unwanted mishaps!
How to Apply for Non-Dom Tax Benefits in Greece
Once you are confident that you are eligible for the Greek Non-Dom Tax Regime, you may be wondering how to start the application process. We have compiled a comprehensive guide below.
1. Understand your eligibility
We have already discussed the various eligibility criteria so you must decide which one is suited to your personal situation.
2. Gather required documentation
There are a number of documents required during the application process, these include:
- Proof of not being a tax resident in Greece for the specified period
- Evidence of the investment plan
- Personal identification documents including your passport and visa
- Proof of residence
- Proof of income from your previous country of residence
3. Apply for your Greek Tax Identification Number (AFM)
If you don’t already have your AFM, it’s time to apply for one. You can do this by visiting your local tax office or Eforioa and submitting your identification documents and proof of residence. You will then have to fill out the required forms you receive.
4. Open a Greek Bank Account
To facilitate the investment and other financial transactions, you must open a bank account in Greece. To do this you will need:
- Your AFM
- Identification documents
- Proof of address
5. Submit your Non-Dom Tax Application
Next, it’s time to submit your application to the Greek tax authorities, or the AADE. This will include:
- Application form for Non-Dom status
- Proof of the qualifying investment or plan to invest
- Required personal and financial documents
6. Await Approval
Once you have completed the previous steps, it’s time to be patient and allow the tax authorities time to review your application, which may take several weeks.
7. Finalize Your Investment
If you haven’t already completed your investment, now it’s time to do so within the specified period (3 years). Be sure to keep all records and receipts as proof of the investment.
There you have it! Now you know the steps involved in the application process for Non-Dom Tax Benefits in Greece. As always, we have more information about taxation in Greece on the Lexidy website.
Key Benefits of the Greek Expat Tax Regime
The Greek Non-Dom tax regime offers several significant benefits designed to attract high-net-worth individuals and investors to Greece. So, let’s explore some of the key benefits below.
Flat Annual Tax on Foreign-Sourced Income
Instead of paying taxes based on the actual amount of foreign income, non-dom individuals pay a flat annual tax rate of €100,000. This covers all foreign-sourced income, regardless of the total amount. As a result, high-income individuals can make significant savings on their foreign income.
Exemption from Inheritance and Gift Tax on Foreign Assets
Non-dom residents are exempt from inheritance and gift taxes on assets located outside of Greece. This allows wealth to be transferred to heirs without any burden of additional taxes and preserving family wealth throughout generations.
Reduced Bureaucracy and Simplified Compliance
The non-dom regime simplifies tax compliance requirements for foreign income. This results in reduced admin burdens and a lower risk of tax disputes, enhancing the appeal for high-net-worth individuals.
Eligibility for Family Members
Family members can also benefit from this regime, with an additional flat tax of €20,000 per family member. This ensures that the entire family can enjoy these tax advantages, making it easier for wealthy individuals to relocate along with their families.
Greece’s General Tax vs Non-Dom Tax Regime
Now, to give you a clearer picture of the benefits of the Non-Dom Tax Regime compared to the general tax rules in Greece, let’s take a look at the two side-by-side.
| General Tax | Non-Dom Tax Regime |
| Income Tax | |
| Progressive tax rates ranging from 9% to 44% on global income Expats are taxed on their worldwide income if they are tax residents Complex compliance and higher administrative burden | Flat annual tax of €100,000 on foreign-sourced income Foreign income is not subject to progressive taxation rates Simplified compliance with reduced administrative requirements |
| Inheritance and Gift Tax | |
| Tax rates on inheritance and gifts range from 1% to 40% Applies to worldwide assets if the expat is a tax resident of Greece | Exemption from inheritance and gift tax on foreign assets No taxation on the transfer of foreign assets to heirs or recipients |
| Capital Gains Tax | |
| Capital gains on the sale of real estate, shares, and other assets are taxed at rates between 15% and 45% depending on the type of asset and holding period Subject to complex rules and potential high tax liability | Foreign capital gains are covered by the flat annual tax of €100,000 Significant savings on tax liability for capital gains generated outside of Greece |
Frequently Asked Questions About The Greece Non-Dom Tax Regime
What is the Greek Non-Dom Tax Regime
The Greek non-dom tax regime allows eligible foreign individuals to pay a flat annual tax of €100,000 on all foreign-sourced income, with exemptions on inheritance and gift taxes for foreign assets, for up to 10 years.How much tax do you pay in Greece?
The tax you pay depends on your income and residency status. Residents are subject to progressive income tax rates from 9% to 44% on their worldwide income.
Do foreigners pay tax in Greece?
Yes, foreigners who are tax residents in Greece pay tax on their worldwide income. Non-residents pay tax only on income sourced within Greece. Additionally, non-domiciled individuals can opt for a flat annual tax of €100,000 on foreign-sourced income.
Can family members also benefit from non-dom tax status?
Yes, family members can also benefit from the Greek non-dom tax status by paying an additional flat annual tax of €20,000 per family member.
Conclusion: How Lexidy Helps Expats Obtain Non-Dom Tax in Greece
The Greek Non-Dom Tax Regime offers an exciting opportunity for expats to enjoy significant tax benefits, such as a flat annual tax on foreign income, and exemptions on foreign assets. This regime makes Greece an attractive destination for high-net-worth individuals seeking favorable tax conditions and a high quality of life.
Are you ready to take advantage of these benefits? Book your free consultation with the legal eagles at Lexidy today to explore how the Greek Non-Dom Tax Regime can work for you and your family!
