The concept of tax residency for individuals and legal entities is defined in the Income Tax Code (Article 4) and is of particular importance because it determines under what conditions a person must be taxed on his worldwide income and file a tax return in our country.

In particular, an individual is a Greek tax resident if:

a) he has in Greece his permanent or principal residence or his habitual residence or center of his vital interests, i.e. his personal and financial connections, or

b) is a consular, diplomatic or civil servant of a similar status, or a civil servant who has Greek citizenship and works abroad.

In addition, an individual who is in Greece for a period exceeding 183 days, in the aggregate for any twelve-month period, is a Greek tax resident from the first day of his stay in Greece.

This does not apply to individuals who are in Greece solely for tourism, medical, therapeutic or similar private purposes, and their stay does not exceed 365 days, including short periods of stay abroad.

When an individual is considered, according to the above criteria, to be a Greek tax resident for a tax year, they must obtain a Greek tax identification number, file a tax return and declare all of their income, whether or not derived from Greece. or from abroad.

In contrast, an individual who is not a Greek tax resident is taxed in our country only in respect of his income from a Greek source and subject to the provisions of the relevant double tax treaty (DTA), if it exists. Similarly, the SADF establishes a set of criteria to be considered when two contracting states claim that the same individual is their tax resident in order to resolve a dispute.

Changing the tax residency of an individual who is tax resident in Greece due to your relocation abroad requires certain procedures and the submission of certain supporting documents (such as a certificate of tax residency) to the competent DOU of the taxpayer, who will resolve the issue. If the respective request is rejected, the taxpayer may apply for annulment to the Council of State.

Accordingly, a legal entity is tax resident in Greece in any tax year if:

a) The company has been incorporated or established under Greek law.

b) Has a registered office in Greece, or

Under what conditions should a person be taxed on their worldwide income and file a tax return in our country.

c) The place of effective management is in Greece at any time during the tax year.

The “place of effective management” is located in Greece on the basis of the facts and circumstances, taking into account, in particular, the following:

a) Place of daily intake.

b) Place of making strategic decisions.

c) the venue of the annual general meeting of shareholders or partners.

d) storage space for books and data.

e) the place of the meeting of the board of directors or other executive management body.

f) place of residence of members of the board of directors or other executive management body.

In combination with the above cases and conditions, the place of residence of the majority of shareholders or partners can be taken into account.

The above provisions are particularly important as they set out the conditions and legal basis for the qualification (by the Greek tax authorities) of legal entities registered abroad (e.g. in Cyprus, Bulgaria, etc.) as Greek tax residents and therefore them to taxation in our country.

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