CROSS BORDER TAX PLANNING: GREEK TAX INCENTIVES
In recent years, Greece has been dynamically trying to become an attraction for foreigners, competing with other European countries such as Malta, Cyprus, and Portugal, which are organized in similar incentive practices.
The "Golden Visa" plan in combination with the residence permit in Greece (and consequently with free movement throughout the Schengen area) that accompanied it, had paid off, especially during 2019. Foreigners Investors who wanted to acquire it could do so either by investing in real estate in our country, but also in bond shares and mutual funds. However, the coronavirus pandemic seems to have slowed its rise and the relative numbers have dropped significantly.
As a result, new tax incentives were designed targeting both the repatriation of young Greek immigrants (many of them being highly specialized or dispose of qualified scientific training) in order to achieve a reversal of the "brain drain" of the last decade but also aiming at Greece to attract citizens from third countries ready to settle and work or even invest in Greece.
For individuals who decide to relocate in Greece as self-employed or as employees, to another professional employment, a reduction of 50% of their income tax is introduced in Greece for the next 7 years after their establishment, under certain conditions.
At the same time, pensioners (foreigners or of Greek origin) are encouraged to choose to settle in Greece, where their tax obligations are limited to an annual income tax of only 7% of the income from their pensions they earn abroad as long as they now live in our country.
This creates a multifaceted framework of tax incentives which can be of particular interest with proper planning both for the repatriation of Greeks and for the settlement of other active or retired individuals.
Our Law firm through its network in Switzerland is quite familiar with the double taxation avoidance conventions and with the EU directives/regulations as well as the OECD recommendations to the extent that they are included in the national tax regulations. We follow with particular interest the developments in the Greek tax legislation in relation to abroad in order to be informed and able to provide quality services in the cross-border tax planning of our clients.