Double Tax Treaties in Greece

Updated on Thursday 31st January 2013

Double tax treaties are agreement signed between two countries in order to avoid the taxation of the same income in Greece and in the country where the entrepreneur resides.

The application of the double tax treaties in Greece is based on a procedure adopted in 1985 by the Greek Minister of Finance, called Tax-Refund system. According to it, in order to beneficiate from the double tax treaties provisions, the payer must deposit at the Ministry of Finance a certificate from the foreign tax authority stating that the payer is a tax resident of that state and a declaration from the payer stating that he’s the beneficial owner of the income, along with other documents that might be considered relevant.

Besides the income, the dividends, interests and royalties are differently taxed, with a lower tax.

Usually, the withholding tax on dividends is 25% for non treaty countries. The withholding tax on interests is 40% and the royalties are taxed with 25% for the non treaty countries. Also a technical fee must be paid and it consists in a 25% withholding tax if the payer is not from a signatory country.

The taxes applicable for treaty countries are smaller, not more than 15% withholding tax, depending on the signed agreements.

The following states and jurisdictions has concluded tax avoidance agreements with Greece so far: Albania, Armenia, Austria, Azerbaijan, Belgium, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Georgia, Germany, Hungary, Iceland, India, Ireland, Israel, Italy, Korea, Kuwait, Latvia, Lithuania, Luxembourg, Malta, Mexico, Moldova, Morocco, Netherlands, Norway, Poland, Portugal, Qatar, Romania, Russia, Saudi Arabia, Serbia, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, Tunisia, Turkey, United Kingdom, Ukraine, United States of America and Uzbekistan.

Many more contracts will be signed in the future, after the approval from the Ministry of Finance is granted.

In order to avoid the tax fraud and tax avoidance that could happen because of the treaties’ regulations, every agreement also stipulates details regarding the exchange of information between the signatory states. If not, protocols of exchange of information are signed.

The regulations of a double tax treaty have priority ahead the local Greek legislation, even in front of the tax laws.

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