The Greek Ministry of Economy recently announced the increase of real estate property tax values as of 1 January 2022.
Such values are the basis upon which taxes are calculated and assessed. Hence, an increase on tax values, automatically leads to a relative impact on property taxation.
Taxes to consider:
- Annual taxes on property ownership:
- ENFIA (Land Tax) payable annually, irrespective if the property is rented out or not
- Additional ENFIA on individuals owing property worth more than 250,000 euros
- Council Rates (TAP) on buildings and lots (0.025-0.035 per cent)
- Taxation of property owned by offshore companies (15 per cent)
2. Conveyancing taxes:
- Stamp duty (property sale tax), that is a percentage of 3 per cent on the tax value of property to be conveyed, plus Municipal Tax (3 per cent), plus Public Roads Maintenance tax (7 per cent) on such stamp duty (paid by the buyer)
- Adverse possession tax (3 per cent)
- Capital Gains Tax (15 per cent – currently suspended)
- Value Added Tax (ΦΠΑ) 24 per cent placed on new developments – of non first-home buyers (currently suspended)
- Tax on Exchange of properties (1.5 per cent)
- Tax on Distribution of properties. (0.75 per cent)
- Relative fee payable to the Land Registry (Ypothikofylakeion) for the registration of Conveyance Deeds to a percentage of 0.475 per cent. A percentage of 0.5 per cent – 0.1 per cent for the registration of such Deeds to the newly established Land Registry Cadastral (Ktimatologio), both calculated on the tax value of the conveyed property.
3. Taxes on Inheritances, Gifts and Parental Gifts of real estate property:
- From 1 to 40 per cent, depending on the consanguinity of the Deceased with the Heir or the Donor with the Grantee. The tax exemption bracket for Parental Gifts is currently at 150,000 Euros (on the property’s tax value).
Analogous fee payable to the Land Registry (Ypothikofylakeion) for the registration of Gifts and Parental Gifts to a percentage of 0,775 per cent. A percentage of 0,8 – 0,1 for the registration of such deeds to the newly established Land Registry Cadastral (Ktimatologio), both calculated on the tax value of the conveyed property.
4. Income tax from property:
- Imputed (assessed) income placed on the use of a residence without exchange (for free) to a percentage of 3 per cent on the tax value of such property. Such use is tax exempted if used by parents or children and it does not exceed 200 square meters
- Imputed (assessed) income for living in your primary or secondary residence (depending on its dimensions and tax value)
- Imputed (assessed) income for using your commercial property (3 per cent of its tax value).
5. Payments to Councils and Municipalities (ΟΤΑ):
- When farmlands are classified within the Zoning Planning, a payment of up to 25 per cent is payable to the Council. Additional conveyance of land can be demanded (10 to 50 per cent).
6. Fines on legalization or use of premises with building violations
Fines by building authorities are calculated according to the tax values of the properties.
Having analysed all relevant taxes that are about to increase, it is recommended to those that plan gifting property to their children or buying property, to proceed as soon as possible in order to avoid the upcoming (unnecessary) tax burdens.
*John Tripidakis is a Greek lawyer. For more information visit www.greeklawyers.com.au