A draft tax bill introduces an expanded tax residence definition for individuals. In specific, an individual’s tax residence is to be determined in principle based on the number of days spent in Greece. In this context, an individual spending more than 183 days in Greece during the same calendar year shall be considered as a Greek tax resident, thus being liable for Greek income tax on his worldwide income. Such rule applies, unless the taxpayer is in the position to prove otherwise.
The bill will be up for a vote this coming week. Tax law expert, Costas Kallideris, attorney at Zepos & Yanopoulos believes it will pass and will become a law.
Furthermore, the tax bill provides that individuals relocating to non-cooperating jurisdictions (i.e. black-listed jurisdictions such as Monaco and Liechtenstein) shall be treated as Greek tax residents, thus being subject to Greek income tax on their worldwide income. Based on the wording of the bill, such treatment applies regardless of the years spent outside Greece after the relocation in the non-co-operating jurisdiction. Please note that the jurisdictions which are treated as non-cooperating for purposes of application of the above provision are Andorra, Anguilla, Antigua & Barbuda, Aruba, the Bahamas, Bahrain, Barbados, Bermuda, Belize, British Virgin Islands, Brunei, Cayman Islands, the Cook Islands, Costa Rica, Chile, Dominica, Gibraltar, Grenada, Guatemala, Guernsey, Isle of Man, Jersey, Lebanon, Liberia, Liechtenstein, Malaysia, Marshall Islands, Montserrat, Mauritius, Monaco, Nauru, Netherland Antilles, FYR of Macedonia, Niue, Panama, Philippines, St. Lucia, St. Kitts and Nevis, St. Vincent and the Grenadines, Samoa, Seychelles, Singapore, Turks and Caicos, US Virgin Islands, Vanuatu, Uruguay and Hong-Kong.
Furthermore, the bill provides that individuals who are already registered as residents outside Greece shall be subject to reporting obligations. The scope of such obligations shall be specified by virtue of relevant guidelines to be issued by the Ministry of Finance. In case of failure to duly comply with applicable reporting obligations, relevant individuals shall be considered as Greek tax residents.
The draft bill mentions that the new tax residence provisions apply from the publication of the new law in the Government’s Gazette. However, it is highly likely that the tax authorities will review the relocation of the individuals who have relocated to non-cooperating jurisdictions in the recent past (at least).
(Source: Zepos & Yanopoulos Law Firm| Costas Kallideris, attorney at Zepos & Yanopoulos contributed to this article)
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