PROPERTY TAXATION

Tax authority probing suspicious rental rate hikes

Tax authority probing suspicious rental rate hikes

Thousands of landlords are the focus of the tax administration that suspects they raised their nominal rent during the lockdowns, while inspectors have identified leased property declarations that do not correspond to the actual owner.

All suspicious cases will be probed by the monitoring mechanism in order to establish whether any landlords have cheated in order to collect state compensation, while in other cases, that are not suspicious but complex, the Independent Authority for Public Revenue will try to find solutions for the fair compensation of landlords, even if it is delayed.

The focus of inspectors will mainly be on the cases of unjustified rental hikes during the pandemic: Several landlords doubled the rents due, when tenants did not pay anyway due to the the government measures, so that the state would pay them higher compensation. Sources say there has been a case where the monthly rent was at 700 euros before the lockdowns but soared to €1,600 after. Tenants did not mind, as they did not pay it, and the landlord received 80% of the rent from the state in the form of support that was also untaxed and protected from confiscation.

The tax mechanism will also look into various other categories, such as multiple declarations for the same asset, or for the same period, or even by multiple tenants; leased properties that do not correspond to declared ownerships, leading to the examination of the documents that would prove the claim a landlord has on an asset; changes in rents that are not reflected in the amendment of the lease contract but mentioned in the Notes section of the original contract instead; and cases of successive subletting.

There also are some 19,000 taxpayers who have not declared their bank details in order to collect their compensation. In those cases the IAPR will send them new emails.

As Finance Minister Christos Staikouras declared on Monday, every possible effort is being made for the few pending cases to be settled in the upcoming period, following the necessary processing to safeguard the public interest.