New property taxes 2014
PROPERTY TRANSFER TAX
In force from January 1 2014. Paid by the buyer in a real estate transaction.
There was an exemption of the first €200,000 for buyers of their first and main residence.
The transfer tax was 8% for property of objective value up to €20,000, plus 10% of the objective value over €20,000.
The exemption remains for buyers of their first and main residence up to €200,000 for single taxpayers. The tax free amount for married couples is €250,000, which increases by €25,000 for each of the first two children, and €30,000 for each of the third and further children.
Otherwise - for buyers of expensive homes, second homes, commercial buildings - the tax is now 3% of the objective value.
Example 1. Purchase of a house of objective value €100,000 which is not the first and main residence.
Old tax: the transfer tax was €20,000 x 8% = €1,600, plus €80,000 x 10% = €8,000, totalling €9,600.
New tax: the transfer tax is €100,000 x 3% = €3,000.
Example 2. Purchase of a house of objective value €400,000 which is the first and main residence for a single person.
Old tax: (taxable value after exemption €200,000) the transfer tax was €20,000 x 8% = € 1,600, plus €180,000 x 10% = €18,000, totalling €19,600.
New tax: the transfer tax is €400,000 x 3% = €12,000.
CAPITAL GAINS TAX
In force from January 1 2014. Paid by the seller in a real estate transaction.
A tax will be imposed according to the increase in objective value of all properties be sold after January 1 2014.
The tax will have a headline rate of 15% and will be calculated on the difference between the purchase price written in the contract, and the sale price written in the contract of the property.
It does not matter how the property was acquired, e.g. purchased and inherited properties are treated the same.
The difference between the two prices will be calculated and a tax reduction factor of up to 0.61 will be applied, depending on the length of ownership of the property. Note that if it is not possible to determine the purchase price (for example due to poor documentation), this is deemed to be zero and the 15% tax will be calculated on the total sale price of the property.
The tax reduction factors according to length of ownership are as follows:
If the property has been owned for at least 5 years and the owner has not sold any other property in this period, then a €25,000 discount is applied to the taxable value.
Example 1. Property purchased for €20,000 in 2010 and sold for €35,000 in 2014.
(€35,000 - €20,000) = €15,000 x 15% x 0.95 = total tax €2,138.
Example 2. Property inherited with value of €5,000 in 1980 and sold for €50,000 in 2014, no other properties sold in that period.
(€50,000 - €5,000) = €45,000 - €25,000 discount = €20,000 x 15% x 0.61 = total tax €1,830.
Example 3. Property purchased for €15,000 in 2001 and sold for €40,000 in 2014, no other properties sold in that period.
(€40,000 - €15,000) = €25,000 - €25,000 discount = total tax €0.
Example 4. Property purchased without proof of value in 1995 and sold for €20,000 in 2014, other properties sold in that period.
(€20,000 - €0) = €20,000 x 15% x 0.73 = total tax €2,190.
RENTAL INCOME TAX
In force from January 1 2014. Paid by owners of rented properties.
Separate taxation on rental income has been introduced. The tax-free threshold of €5,000 has been abolished. For annual rental income of up to €12,000, the tax rate is now 11%. For higher annual rental incomes, the tax rate is now 33%.
UNIFIED PROPERTY TAX
In force from January 1 2014. Paid by property owners.
The tax replaces all previous property ownership taxes and is called "ENFIA" for short. It affects ALL property: buildings, agricultural and non-agricultural land, inside and outside urban areas.
ENFIA has two components:
(a) the main tax, which calculates a tax against each property in a person's ownership;
(b) an additional tax, payable if a person's total Greek property values exceed €300,000.
- calculates a property tax based on the property size, type, objective value, age, location, number of floors, etc.
- buildings will be taxed at €2 - €13 per m2, depending on which of 12 zones the property is located in.
-- the tax for buildings up to 4 years old will be 25% higher than the tax for older buildings.
-- auxiliary spaces will be taxed at 10% of the value of the main use.
-- the tax is reduced by up to 50% for special buildings; and for buildings without electricity, up to 40%.
-- only stables and some temporary agricultural structures (pens, coops, warehouses, etc.) are exempt.
- agricultural land and pastures will be taxed at €1 - €3 per 1,000m2 depending on location, irrigation, forestry, etc.
- plots of land are taxed at €3 - €9,000 per 1,000m2.
-- there are 25 tax bands, determined by factors such as the location, land development, commercial activities etc.
- if a property has an objective value above €300,000, there will be an additional tax.
-- the additional tax on land with an objective value of up to €1,000,000 euros, will be €100 - €3,800
-- above €1,000,000 objective value, the tax will be 1% of its objective value.
When calculating the final tax, there are discounts and exemptions for certain groups of people: families with many children, long-term unemployed, disabled people and poor families will receive discounts of 50 - 100% subject to certain income and ownership conditions.
This only applies to owners whose property holdings in Greece have in total objective value in excess of €300,000.
-- the tax ranges from 0.1% to 1% of the objective value.
-- land outside urban areas is ignored when calculating this additional tax.