The value of immovable property in Greece is still way below the pre-crisis value, however, when purchasing properties with a building permit issued after the 1st of January 2006, purchasers also need to pay 24% VAT in the case that they are not Greek or not using the property as their primary residence.
24% VAT Exemption
The 24% VAT applicable in Greece results in a very high tax load when considering new properties, and investors seem to prefer buying properties with a building permit issued before January 2006. When calculating the other costs involved in a property transaction such as the notary, lawyer and cadastral fees, Greece becomes one of the most expensive countries in the European Union adding an approximate 30% over and above the value of the property.
Greece Prime Minister Kyriakos Mitsotakis has announced a number of tax cuts aimed at attracting more foreign direct investment to Greece and declared that the mission of the new government is to reduce taxes and bring new investments. The first measure taken is to decrease the ENFIA tax, which is a tax on the ownership of property. Simply by owning a property in Greece, makes one subject to the annual ENFIA tax which is calculated based on various factors including the location, age and size of the property. Further, to the government’s tax bill passed in Parliament on July 30, property owners will pay between 10% and 30% less this year depending on the property’s value.
The major announcement by Mitsotakis, however, is the exemption from the 24% VAT which will be applicable to all new developments which are to be constructed. The VAT exemption will only apply for the next three years meaning that investors purchasing property in Greece would only be subject to the regular 3.09% property transfer tax.
Greece Golden Visa
The purchase of a property or a number of properties in Greece with a value of at least €250,000 gives the investor and his family members a permanent residence permit in Greece. This brings with it sufficient benefits to the investor particularly the right to live in Greece indefinitely as well as the right to travel within the Schengen Area without the need of a visa. Through these amendments, the total cost for acquiring a Greek Golden Visa will be significantly reduced, positioning the programme as more favourable for foreign investors.
During 2018, 1,399 applications for the Greece Golden Visa Programme were approved, however, during 2019 a decrease of 754 applications was witnessed. As a firm, we believe that these amendments are a step in the right direction. Such changes will definitely help to boost interest in the Greece Golden Visa Programme. By eliminating the 24% VAT it is anticipated that the Greek real estate market will experience a positive growth.
The value of immovable property in Greece is still way below the pre-crisis value, however, when purchasing properties with a building permit issued after the 1st of January 2006, purchasers also need to pay 24% VAT in the case that they are not Greek or not using the property as their primary residence.
24% VAT Exemption
The 24% VAT applicable in Greece results in a very high tax load when considering new properties, and investors seem to prefer buying properties with a building permit issued before January 2006. When calculating the other costs involved in a property transaction such as the notary, lawyer and cadastral fees, Greece becomes one of the most expensive countries in the European Union adding an approximate 30% over and above the value of the property.
Greece Prime Minister Kyriakos Mitsotakis has announced a number of tax cuts aimed at attracting more foreign direct investment to Greece and declared that the mission of the new government is to reduce taxes and bring new investments. The first measure taken is to decrease the ENFIA tax, which is a tax on the ownership of property. Simply by owning a property in Greece, makes one subject to the annual ENFIA tax which is calculated based on various factors including the location, age and size of the property. Further, to the government’s tax bill passed in Parliament on July 30, property owners will pay between 10% and 30% less this year depending on the property’s value.
The major announcement by Mitsotakis, however, is the exemption from the 24% VAT which will be applicable to all new developments which are to be constructed. The VAT exemption will only apply for the next three years meaning that investors purchasing property in Greece would only be subject to the regular 3.09% property transfer tax.
Greece Golden Visa
The purchase of a property or a number of properties in Greece with a value of at least €250,000 gives the investor and his family members a permanent residence permit in Greece. This brings with it sufficient benefits to the investor particularly the right to live in Greece indefinitely as well as the right to travel within the Schengen Area without the need of a visa. Through these amendments, the total cost for acquiring a Greek Golden Visa will be significantly reduced, positioning the programme as more favourable for foreign investors.
During 2018, 1,399 applications for the Greece Golden Visa Programme were approved, however, during 2019 a decrease of 754 applications was witnessed. As a firm, we believe that these amendments are a step in the right direction. Such changes will definitely help to boost interest in the Greece Golden Visa Programme. By eliminating the 24% VAT it is anticipated that the Greek real estate market will experience a positive growth.