What are Tax Implications For Expatriates Relocating to Greece?

What are Tax Implications For Expatriates Relocating to Greece?

Tax Implications For Expatriates Relocating to Greece?

What are Tax Implications For Expatriates Relocating to Greece: Greece can be a very enticing location for expatriates of the United States. It offers a very cost-effective Residence-by-Investment Golden Visa opportunity. And, if the US Person decides they want to expatriate and pursue citizenship at a later time — that is also a viable option. In addition, for Taxpayers who think they may have run afoul with the law, they can take some comfort in the fact that Greece is not the most agreeable nation when it comes to extradition requests form the US. Despite the many benefits Greece offers, one problem with becoming a tax resident of Greece is that the tax rules can be pretty intrusive for expatriates who are considered tax residents of Greece (although a new program designed to entice expatriation to Greece may limit the tax impact).

Golden Visa Greece RBI

The Golden Visa Program for Greece is one of the more cost-effective options for Taxpayers. While it requires a substantial investment — the amounts are not as high as other countries such as Singapore or Australia. It generally requires about a $300K to $500K investment into the purchase of property in Greece — or investment into businesses/companies in Greece. Alternatively, the applicant can also simply deposit money into a Greek Bank and/or investment in corporate or government bonds in Greece.

Is the Golden Visa in Greece Worth it?

The Greece Golden Visa is for 5-years (and Citizenship can be sought after 7-years).

Here are some of the benefits of the Greece RBI:

Schengen Zone Travel

When it comes to a Golden Visa, one of the key benefits are the travel rights for those without a passport — and the Greece Golden Visa is no different. One important benefit of the Greece RBI is the ability to travel throughout the Schengen Zone/Area with little hassle.

Family Members can Join-in with Ease 

With some RBI Programs, it can be very difficult, time-consuming and expensive to add-on family members — but Greece makes the process relatively simple.

Subsequent Greece Citizenship

After a person has resided in Greece for 7-years, they may qualify for citizenship.

Investment in Greece

Taxpayers can make additional investment in Greece during their RBI period.

Education in Greece

Taxpayers can pursue educational in pursuits in Greece during their RBI period. Not all RBI programs allow for investment residents to enroll in public eduction.

Greece Tax System & Expatriates Relocating to Greece

While obtaining the Investment Visa in Greece is less complicated than in many other countries — the negative tax implications of becoming a resident of Greece may outweigh the positive benefits. Let’s take a look at how the tax system works:

Personal (Individual Tax Rates)

While the individual tax rates vary, once a Taxpayer exceeds 40K EUR, they can be subject to a 44% progressive tax rate — higher than the US.

Solidarity Tax 0 -10%

A Solidarity tax ranges from 0 to 10% based on a progressive tax rate. In 2020 the tax became very limited — and only applicable to certain categories, while in 2021 it was suspended — but scheduled to re-commence (in part) in 2022.

Real Estate Income:  15%/35%/45%

Greece levies a higher tax rate on real estate income than many other countries. It is a progressive tax rate based on the amount of income generated and there is typically ~40% allowable for certain deductions associated with ownership.

Greece Expatriate Tax Regime

When a Taxpayer plans on obtaining an RBI in Greece, and important consideration is whether or not they plan on being a permanent resident. Residents are taxed on the worldwide income, while nonresidents are generally taxed on their Greece sourced income (including solidarity tax). To entice foreigners, Under the current expatriate regime, when a Taxpayer expatriate resides for at least 2 years in Greece — they are exempted income tax and solidarity on 50% of their income. There are various requirements and limitations, such as limited residence in the prior years and having relocated from a cooperating country

Corporate Tax & VAT

Resident Corporations are Taxed on Worldwide Income.

Corporate Tax Rate

The corporate tax rate was 24%, but has been reduced to 22%.

VAT Tax 

VAT refers to value-added tax. It takes on many similarities to sales tax, but it essentially kicks in at every stage of the process (e.g., as value is being added) and subtracts prior VAT paid. Different items/product categories may have different VAT percentages.

Interested in Expatriation from the U.S.?

Our firm specializes exclusively in international tax.

Contact our firm for assistance with getting compliant.