Greece’s 7% Tax on Foreign Income Scheme – An attractive proposition for retirees in Greece
Greece has many attractive investment schemes – not only beautiful islands, stunning landscape and the world famous Mediterranean diet. One of the investment schemes that our accounting and taxation scheme has strong experience in is the 7% on foreign sourced income scheme.
This is an attractive scheme for retirees and pensioners from across the globe and puts Greece in a strong position on a global level for people looking for a tax-effective destination to enjoy retirement.
The relevant legislation was released in July 31, 2020 and enables retirees to pay a flat annual tax rate of 7% on all foreign-sourced income. This is a significant reduction in terms of tax burden for retirees – and helps retirees from around the globe such as the UK and the USA to retain more of their income for daily expenditure and general enjoyment.
How do I know if I’m eligibility for the Greek 7% Tax on foreign income retirement scheme?
You need to meet specific criteria for this tax regime including:
- Not having been a tax resident in Greece for five out of the previous six years before the year you will move your tax residency to Greece.
- Transfering your tax residency to Greece from a country that Greece has a tax cooperating agreement with. Speak to our team to check if your country has a tax cooperation agreement with Greece.
Greece has other tax schemes which also apply and are advantageous including:
- 0% on capital gains tax. This helps ensure the profits on any sales are not subject to taxation. This is important particularly for shares in businesses and also shares on the stock market.
- A low dividend tax rate of 5%. This is useful for investing your savings as this is a particularly low rate to pay on dividends.
Why retire in Greece
The reasons are endless and differ from person to person however, some of the benefits of retiring in Greece aside from the tax advantages include:
- Greece has a rich history with many archaeological sites to explore.
- Greece caters for high-end retirees.
- There is a low cost of living compared to the rest of Europe.
- Greece has a very high quality healthcare system.
- Greece is well connected globally.
- Has lovely cuisine.
- Lots of travel options inside Greece as well as islands such as Crete and Rhodes that are large enough to live on comfortable.
Options for becoming a Greek resident
EU Citizens:
The residency process is quite simple for EU citizens. There are no real residency restrictions and you generally need to obtain the EU card in order to transfer your tax residency. You need to register your residency within the first three months of your arrival.
For non-EU citizens
There are a few options for residency that suit foreign nationals from non-EU countries including:
- FIP Residency: This is the Financial Independent Persons Visa and allows you to stay for three years in Greece. It is also renewable and the process is fairly straight forward.
- Golden Visa: This is a visa by investment scheme. There are specific minimum investment requirements which are team is able to assist you with.
Are you considering retiring in Greece under the 7% foreign tax resident scheme?
There are many factors to consider. Based on the retirees we have assisted from the UK (England), Iran, Israel, the United States, Canada and other countries including countries within the EU such as Denmark, we have noticed some trends in terms of the reasons retirees take up the 7% foreign tax incentive:
- For pure tax purposes: From a pure tax perspective, Greece is a great place to base yourself. You can take advantage of the 7% foreign tax resident scheme and travel extensively since you need to be in the country for 183 days per year to qualify as a tax resident. The scheme offers a substantial saving on tax and there are many cost effective places to live that area attractive. A key advantage is that Greece has agreements in place with many countries across the globe so there is a high chance, depending on the country that you are from, that Greece will have an agreement with your respective country. Speak with our team to see if you are suitable. Also, the cost of living is generally quite low in Greece and therefore it makes sense to retire in Greece.
- An additional benefit for people in love with Greece: Many of our clients fall in love with Greece and often a specific region such as Crete, Rhodes, Santorini or Athens. They dream of retiring in Greece and enjoying the Mediterranean climate. The main issue here is residency and that’s an area are legal and citizenship team assists with. The special tax regime is merely a ‘bonus’ and handy additional outcome to help you enjoy your retirement in Greece.
How can our team help you take advantage of the special tax regime for retirees
Our team of tax and legal professionals will guide you through the application process for the 7% tax incentive. We will work with you to assess if you are eligible, and ensure that you are eligible for residency as well as the tax regime.
Our team can guide you through every step of the application process. Enquire with our team today to discuss how we can assist.