The Ministry of Finance issued guidelines on the proof required by non tax residents in Greece, in order to support their status as non tax residents in Greece (Circular 1145/2012).
In brief the Ministry requires that non-residents produce within the deadline for the filing of the annual individual income tax return the following documents:
- a valid certificate of tax residence, in case the person is a resident in a state with which Greece has signed a double tax convention or
- the tax return filed in his state of residence (i.e. the state in which the person is subject to taxation for his worldwide income).
The publication of the circular comes with a 14-month delay (the law establishing the obligation was passed in March 2011) and it creates more problems that the one it is supposed to solve. In particular, the circular fails to take into account all the cases of foreign tax residents and it imposes a considerable burden on all non-residents, without specifically attacking tax fraud or insincere taxpayers.
In addition, the timing is also problematic, as the deadline for the submission of the required documents is very short whereas the administrative burden on both the individuals and the foreign tax administrations who will issue the certificates of residence is quite heavy; this is aggravated by the fact that in some cases the documents are required to bear an Apostille and in all cases they must be accompanied by an official translation in Greek.
It is expected that the relevant legislation and the accompanying guidelines will need to be reformed in the near future, in order to better serve their anti-avoidance purpose without excessively burdening sincere taxpayers.
In brief the Ministry requires that non-residents produce within the deadline for the filing of the annual individual income tax return the following documents:
- a valid certificate of tax residence, in case the person is a resident in a state with which Greece has signed a double tax convention or
- the tax return filed in his state of residence (i.e. the state in which the person is subject to taxation for his worldwide income).
The publication of the circular comes with a 14-month delay (the law establishing the obligation was passed in March 2011) and it creates more problems that the one it is supposed to solve. In particular, the circular fails to take into account all the cases of foreign tax residents and it imposes a considerable burden on all non-residents, without specifically attacking tax fraud or insincere taxpayers.
In addition, the timing is also problematic, as the deadline for the submission of the required documents is very short whereas the administrative burden on both the individuals and the foreign tax administrations who will issue the certificates of residence is quite heavy; this is aggravated by the fact that in some cases the documents are required to bear an Apostille and in all cases they must be accompanied by an official translation in Greek.
It is expected that the relevant legislation and the accompanying guidelines will need to be reformed in the near future, in order to better serve their anti-avoidance purpose without excessively burdening sincere taxpayers.
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