Hundreds of Foreigners Enticed by Greece’s Tax Incentives

Hundreds of foreign citizens have already taken advantage of the tax incentives recently introduced by Greece and relocated their tax residence.

According to data from the Greek ministry of Finance, among those are 90 foreign millionaires and 180 pensioners from abroad.

The recent framework has convinced hundreds of wealthy foreigners to abandon other favorable tax systems and join the Greek one.

Many of them have moved their tax domicile from the United Kingdom, and even from South America to Greece, while several Scandinavian pensioners have relocated to Greece, buying properties too.

A new provision was introduced in late 2020 for individuals earning employment income in Greece, who transfer their tax residence in Greece and choose to be subject to a favorable tax regime regarding their employment income for services rendered in Greece.

In order for someone to be eligible they need to satisfy the following conditions:

• they have not been Greek tax residents for the previous 5 of the last 6 years before the transfer of their tax residence in Greece,
• they relocate from a country with which Greece has a valid agreement concerning administrative cooperation on tax issues,
• they are providing employment services in Greece through an employment relationship as defined by Greek law to a Greek legal person on legal entity or to a Greek branch of a foreign company and
• they declare that their stay in Greece will be for at least two years.

The special taxation regime applies also to individuals who transfer their tax residence in Greece with an intention to undertake business activity in Greece.

Tax plan to move or work remotely from Greece

All this is part of Greece’s wider plan to attract foreign investors and those who work remotely to move to or invest in the country, in hopes of remedying Greece’s notorious “brain drain,”  when skilled workers left the country en masse due to the poor economy during the last decade.

Officials hope that the tax breaks will entice the new generation of professionals who already work remotely to relocate to the country post-Covid, bringing a much-needed boost to the Greek economy.

Greece has recently been taking the first steps to create a business environment that would attract so-called digital nomads and ease the founding of start-ups.

In March 2021, Prime Minister Kyriakos Mitsotakis outlined a multi-billion-euro plan dubbed “Greece 2.0,” including investments in 5G networks, which Greece began rolling out in December to reinforce its attractiveness to those who can work remotely.

Attracting digital nomads is a new global trend from which Greece can benefit, Tourism Minister Haris Theoharis said recently.

“According to a study by the MIT Enterprise Forum, if Greece attracted 100,000 digital nomads each year, with an average stay of six months, our country could benefit by more than 1.6 billion euros.

“This amount almost matches the weekly income brought in by 2.5 million tourists,” Theoharis noted.