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How does the three-year tax holiday work for Golden Visa applicants?

I learned that the new prime minister of Greece has announced a three-year tax holiday on property-related capital gain and VAT. Is this something foreign investors who gain residency in Greece through the Golden Visa program can enjoy? How does it work?

  • Georgellis Evaggelos Law office
    November 21, 2019

    For the next three years, VAT (24%) is suspended on all new building permits and on older ones issued as of Jan. 1, 2006 for non-residential real estate. In other words, all new constructions, as well as real estate that has been built in the last 14 years and have not yet been sold, are now exempt from VAT. Only a 3% transfer tax will be charged on the sale of these properties. Obviously, this arrangement can also benefit investors in the Golden Visa program. They are subject to a three-year VAT suspension, which includes new licenses and old licenses issued as of Jan. 1, 2006, is optional and granted at the request of the construction companies within a six-month time limit set by the legislation.

    November 18, 2019

    Anybody qualifies. Hence, also a golden visa investor, who buys a real estate property directly from the constructor that was built in the period from 2006 to date, will not suffer the 24% VAT on the purchase price, but will instead be burdened with real estate transfer tax at 3.09%. Additionally, when the investor sells the property, he or she will not suffer capital gain tax. This is the case as of today, but with the new draft law, this tax exemption will be extended for another three years.

  • Energopiisi SA Investment Consulting Services
    November 13, 2019

    The Greek Government, focusing on boosting the real estate market and the Golden Visa program, submitted two specific measurements to the legal taxation draft under public discussion up to Nov. 15, 2019. Until now, the properties with construction license after Jan. 1, 2006 were subject to VAT of 24%, instead of 3.09% applicable for those ones before Jan. 1, 2006. For the above reason, these properties were not preferable by foreign investors. Now with the announcement of the three-year tax holiday on VAT on these properties and the new constructions, the market is open for those properties. The second measure is to freeze the capital gain tax of 15% on property sales for three years. Let’s wait for the final legal text to be voted in order for these two provisions to be in force. The procedure for the Golden Visa program does not change. The difference is that the investors will be able to buy newly constructed properties under lower tax payment.

  • Royalty Estate
    November 12, 2019

    With this move, the government is currently opening the market to investors for newly built houses that were subjected to an additional 24% tax. This was a significant reason that these properties were not been chosen by the investors of the Golden Visa. The process is the same.

  • Stilianos Ch. Proestakis
    November 11, 2019

    Non-residents in Greece will pay tax on their income derived in Greece but not on income from outside the country. Income tax starts at a rate of 22%. Rental income from property in Greece is taxed at rates, from 11% to 33%. Certain expenses are deductible from the gross income. Capital gains tax (CGT) is charged at 15% on property sales. As for the announced three-year tax holiday on property-related capital gain and VAT, we all have to wait and see how this works exactly for Golden Visa applicants.