The Income Tax Code provides that non-commercial legal entities of public or private law, which include all types of associations and institutions, are subject to income tax, with the exception of all types of income realized for the achievement of a goal that they are not subject to income tax.

Illustrative cases of such income are mentioned, such as dues (subscriptions) and rights to register their members, income from fundraising, government subsidies, private or commercial sponsorship, donations from third parties, lotteries, from advertising placed in magazines published and distributed only by their own members free of charge, as well as income from the distribution of brochures and other forms of spiritual content of the Holy Monasteries.

On the contrary, income received by the above persons from activities that are not the fulfillment of their non-commercial mission, are subject to taxation, even if they are directed to the fulfillment of their non-commercial purpose, provided that only income received to achieve its purpose is not subject to taxation (decision 383 /1973 State Legal Council).

In this context, taxable income is income derived from capital (interest, real estate income, etc.) and capital gains from capital investments. As well as subscriptions from third parties who are not members, income from the publication and sale of magazines, books, letterheads, etc. to third parties who are not members, as well as from the advertisements registered in them, income from advertising on sports club shirts, income (training ) from the activities of private schools, workshops, etc., income from the sale of images, from the operation of guesthouses and radio stations by the Holy Monasteries, etc.

In any case, of course, the determination of the receipt of income for the achievement of the goal by the above persons comes down, in fact, to the control competence of the tax authority, which judges their orderly purpose and the manner in which they receive and dispose of their income (POL 10044/2015).

Taxable income is income derived from capital gains and capital transfers.

In particular, with regard to income from tuition fees received by non-profit legal entities of a public or private nature (including associations and institutions) with the main purpose of providing education, POL 1123/2015 clarifies that they are not subject to taxation, since as long as they created to achieve their non-profit educational purpose.

On the contrary, tuition fees are taxable if they represent income from activities that are not the pursuit of the non-profit purposes of non-profit legal entities, in cases where the activities of a private educational institution are not the main purpose of the non-profit legal entity, but a side activity that it has developed. Significantly, as an example, mention is made of a charitable foundation for the care and education of children with cognitive, mental and developmental disabilities, which also operates a kindergarten and collects fees for its activities, as well as a church foundation that created and operates a private elementary school.

Civil companies, whether they have a profit or a non-commercial purpose, are taxed and subject to taxation in respect of their income that arises either in Greece or abroad. – to tax the gross income of companies, only income derived from commercial activities (eg, holding public performances, publishing newspapers, showing movies, rent, interest on deposits, etc.).

* Ms. Jenny Panu is the head of the tax department of ASnetwork (www.asnetwork.gr).