Checking 40,000 property sales
Tax administration will examine the origin of the money spent on certain realty transactions
The tax administration is launching audits and cross-checking to establish the origin of 462 million euros spent on the all-cash purchase of more than 40,000 properties.
From the day the myProperty online application was launched – i.e. from March 2021 – until the end of August, tens of thousands of purchases and sales of houses, plots and commercial properties were identified, which were carried out with cash.
The Independent Authority for Public Revenue (AADE) is initiating complex cross-checks by retrieving real estate transfer files which have been characterized by tax administration officials as “high-risk,” not only for tax evasion, but also for money laundering. In fact, if cases of money laundering are found, the cases will be sent to the competent Authority for Combating Money Laundering from Criminal Activities. Checks will be expanded to buyers as well as sellers of real estate. Although the purchases were made entirely in cash, bank accounts will be opened, as well as spending via credit cards, but also spending on travel etc.
Up first will be the purchase and sale of properties of great value and will be completed after sifting through those of lesser value. The latter category’s tax returns and bank accounts will be scrutinized to see if large sums of money have been withdrawn that could justify buying and selling real estate with cash. Any cash donations will also be sought, as well as any professional activity. If any discrepancies are found, they will be asked by the tax authorities to give explanations and in fact to justify the origin of the money. Otherwise they will be asked to pay tax at a rate of 33% which will be imposed on the unjustified amount.
According to the existing legislation, the increase in assets is not subject to taxation, as long as the taxpayer is able to prove its actual source, as well as that it has either been subject to legal taxation or is exempt from tax. In all other cases any increase in property that comes from an illegal or unjustified or unknown source or cause is considered a profit from business activity and is taxed at a rate of 33%.
