Solution on unpaid rent tax

An out-of-court declaration will likely suffice for landlords to avoid any unfair charges

Solution on unpaid rent tax

The Finance Ministry is seeking a solution to the major problem of rents that were not collected in 2020, as thousands of landlords have not received their tenants’ dues, which may run up to the entire year’s takings, due to the pandemic.

Kathimerini understands that the ministry, in cooperation with the Independent Authority for Public Revenue, is considering whether property owners can issue their tenants with an out-of-court declaration, so that they won’t have to pay income tax on rents they did not collect last year. That solution will not require resorting to the courts, or having a payment order issued etc.

That proposal will not only concern landlords who were not paid their rents at all, but also those who have suffered a forced 40% reduction in their rental takings but have not received the other 60% either.

According to the federation of property owners (POMIDA), hundreds of thousands of landlords who did not collect rents in 2020 risk being taxed for rental payments that weren’t received, because due to the Covid restrictions they cannot resort to the courts or submit rent postponement declarations to the tax offices before uploading their tax statements.

In that context POMIDA has asked the ministry and the IAPR director to introduce the solution of an extrajudicial declaration submitted to tenants by court officials, for the record.

Consequently, for property owners’ full exemption from tax on unpaid rents, they will just need to submit the declaration to the tax authorities through the Taxisnet platform, after its submission to the tenants. That means any landlord will be able to use their username and password to upload the declaration for the tax authorities to exempt them from tax on rental takings.

According to the existing legislation, revenue from letting real estate that has not been collected by the owner should not be incorporated in their total income, provided that a document proving the rent has not been collected has been issued by the deadline for the tax statement’s submission.

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