Changes to Rental Income Taxation and Property Ownership in Greece
Recent changes in Greek legislation are impacting landlords and tenants, particularly concerning the taxation of rental income and property ownership. These changes aim to increase transparency and reduce tax evasion.
Property Ownership by Bulgarians: A recent report indicates a meaningful increase in Bulgarian property ownership in Greece.over the past five years,the number of Bulgarians owning property in Greece has increased by over four times,with Bulgarians now owning real estate in 67 countries globally.
New Regulations for Rental Income (Effective April 1st):
* electronic Payments Mandatory: All new and existing lease agreements require rental payments to be made electronically.Cash payments are no longer legally accepted.
* Landlord Bank Details Required: Lease contracts must include the landlord’s personal bank account details. Accounts belonging to attorneys, estate managers, or relatives are not permitted for receiving rental payments.
* Digital Reporting to Tax Authority: Landlords are now obligated to declare all lease agreements on a digital portal maintained by the Greek Revenue Agency (AADE).The system will automatically verify that rental payments are received each month.
* Penalties for Non-Compliance: Failure to comply with these regulations will result in fines. More significantly, landlords will lose the 5% income tax discount on rental income, and tenants will be ineligible for various state support programs.
* Expected Fiscal Impact: The Greek government anticipates recovering over half a billion euros in previously unpaid taxes through these measures.
Property Value Recalculation & Tax Evasion:
Greek property values are now automatically recalculated annually based on market developments.There is a growing concern regarding tax evasion in property purchases in Greece.
Risk to Landlords – Bank Account Access:
Rental income, unlike wages and pensions, lacks the same legal protection from garnishment. If a landlord has outstanding debts to the state, the tax authorities can directly access their registered bank account and sieze rental payments as soon as they are deposited. This is according to reporting by To Vima.
Sources:
* https://webnews.bg/news/392139/v-gratsiya-vsichki-novi-dogovori-za-naem-shte-se-plashtat-elektronno
* https://webnews.bg/news/392138/nad-4-pati-poveche-balgari-s-imoti-v-gratsiya-za-5-godini
* https://webnews.bg/news/392139/v-gratsiya-vsichki-novi-dogovori-za-naem-shte-se-plashtat-elektronno
* https://webnews.bg/news/392140/uhavane-na-dani-pri-pokupkite-na-imoti-v-gratsiya-se-razprostranyava