ECONOMY

How foreign retirees can pay tax in Greece

How foreign retirees can pay tax in Greece

The government formally issued a call on Wednesday to pensioners from abroad wishing to relocate to Greece and become taxpayers in this country, with a number of foreigners having already contacted the competent authorities in Athens with questions about the process.

Kathimerini understands that a significant number of pensioners from other countries had contacted the tax office for residents abroad to find out what the exact procedures are for becoming a Greek tax resident, but as the ministerial decision had not yet been issued, the information tax officers were able to provide callers with was restricted to the existing legislation.

However, on Wednesday the Finance Ministry finally issued the decision on the terms and conditions of eligibility, although the deadline for applications regarding the 2020 financial year (to become a resident in 2021) expired on Wednesday too. Still, ministry sources say an extension will be granted and those wishing to apply from this year will probably have until the end of 2020 to do so.

The following three eligibility criteria will apply for pensioners from abroad to secure tax residence in Greece with a flat income tax rate of 7% for the next 10 years:

1) They should not have been Greek tax residents for any more than one of the last six years.

2) They must shift their tax domicile from a state with which Greece has a valid agreement for administrative cooperation on tax issues.

3) To prove that they are recipients of pensions from abroad, they must produce any document from their social security fund or another public authority or professional fund or insurance company that illustrates the payment of a state or private pension abroad.

Any individuals who meet the criteria for the new program and have already shifted their tax residence to Greece since 2019 will need to submit their income tax declaration for the 2019 financial year by October 31, 2020. In this case the 7% tax will be paid in a lump sum within a month of the approval of their application to enter the program – i.e. by November 26.

The tax that foreign pensioners have to pay will come due in one tranche each tax year, with the deadline set for the last working day of July.

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