A Comprehensive Guide to Understanding VAT Greece

VAT legislation was first introduced to Greece in 1987 and encompassed EU VAT Directives, which were designed to harmonize VAT systems across the EU. However, with various rates, rules, and regulations, it can be difficult to understand Greek VAT requirements when doing business in the country. Our guide to Greek VAT will shed light on the intricacies of VAT Greece, from registration requirements to ecommerce and digital services VAT, helping you stay well-informed and compliant in your business operations.

Short summary

• Greece has a standard VAT rate of 24%, reduced rates of 13% and 6%, and 0% for certain products.
• Businesses are required to register for VAT when annual turnover exceeds €10,000 to avoid fines & penalties.
• Companies in Greece must adhere to mandatory invoicing requirements, reporting deadlines, record keeping & storage regulations to remain compliant with Greek tax laws.

Overview of Greek VAT

The Greek VAT system, known as FPA or Foros prostithemenis aksias, is a crucial aspect of the Greek economy. Businesses operating in the country are required to have a Greek VAT number, which follows the structure EL999999999. The system adheres to EU VAT directives and is overseen by the Ministry of Finance, alongside regional tax offices. Greek VAT applies to goods and services provided within the country, and businesses must follow the regulations and procedures set forth by the Greek tax authorities.

With a variety of VAT rates, thresholds, and registration requirements, grasping the nuances of Greek VAT can be challenging. However, staying up-to-date with the latest VAT news and understanding the essentials will help businesses efficiently navigate this complex landscape.

VAT rates in Greece

Greece’s standard VAT rate stands at 24% for most goods and services. In addition to the standard rate, Greece also has reduced VAT rates of 13% and 6% for specific items. Also, a 0% rate applies to certain products, such as exports and international transport services. Having a good grasp of the Greece VAT system is crucial for businesses operating in the country.

With the diverse array of VAT rates in Greece, it’s vital for businesses to be aware of the applicable rates for their goods and services to ensure compliance and avoid potential penalties.

Standard VAT rate

The standard VAT rate of 24% applies to the majority of goods and services in Greece, with the taxable value being the base price of these goods and services. Greek VAT generally takes this rate into account when charged on top of the base price, ultimately affecting the final cost for consumers. For businesses, this means they have the responsibility of collecting and remitting the correct amount of VAT to the Greek tax authorities.

Reduced VAT rate

Certain goods and services in Greece are subject to reduced VAT rates of 13% and 6%. Items such as food, baby products, water, and medical equipment are eligible for a 13% reduced rate. The 6% reduced rate applies to a variety of items, including medicines, magazines and books, hotel service, and theatre and movie tickets.

By offering these reduced VAT rates, the Greek government aims to support specific sectors and promote affordability for essential goods and services through the reduced VAT rate.

Super reduced rate

The super reduced rate in Greece refers to a 0% VAT rate applicable to certain products and services. Some examples of goods subject to the 0% rate include the supply and importation of gold, Covid-19 vaccines approved by the European Commission or other Member States, and in vitro diagnostic medical devices.

In addition to these, exports and international transport services also benefit from the 0% VAT rate. By offering a 0% rate for specific products and services, the Greek government provides incentives for businesses engaged in international trade and encourages the growth of these sectors.

Greek VAT registration requirements

Whether or not your business needs to register for VAT in Greece will depend on a number of factors. To register, companies must submit the necessary forms and documentation, and if they're a non-EU entity, appoint a fiscal representative to handle their VAT obligations in Greece.

Understanding and adhering to these VAT registration requirements is crucial for businesses to avoid potential penalties and ensure compliance with Greek tax regulations.

Registration thresholds

There is no registration threshold for domestic businesses operating in Greece. This means that if your Greece-based business is engaged in economic activity, it must be registered for VAT with the Greek tax authorities. Any company that distance sells to private individuals in Greece must register for VAT if their annual turnover exceeds €10,000.

Failure to register for VAT in Greece can result in fines and other sanctions. Therefore, businesses must closely monitor their turnover and ensure they register for VAT when necessary. By keeping track of their turnover and adhering to the registration threshold, businesses can avoid potential penalties and maintain compliance with Greek tax regulations.

Forms and documentation

To register for VAT in Greece, businesses are required to submit the appropriate forms and provide supporting documentation. EU-registered businesses must complete the relevant forms and submit them via email to the appropriate local tax office. The Greek tax authorities may also require some of these documents to be translated.

The registration process can take between two to three weeks, although this timeframe may vary depending on individual cases. By ensuring that all necessary forms and documentation are submitted accurately and in a timely manner, businesses can expedite the registration process and avoid delays in obtaining their Greek VAT number.

Fiscal representatives

Non-EU businesses that do not have a registered office, permanent place of abode, or place of business within the European Union are required to appoint a fiscal representative in Greece. This fiscal representative is a natural or legal entity, with their primary place of business, permanent establishment, domicile, or usual residence situated in Greece. As a taxable person, they're responsible for handling the tax obligations of the non-EU business they represent.

Appointing a fiscal representative is a critical step for non-EU businesses operating in Greece to ensure compliance with Greek VAT regulations. The fiscal representative assists these businesses in navigating the complex VAT landscape, submitting VAT returns, and fulfilling their VAT obligations in a timely and accurate manner.

VAT obligations for businesses in Greece

Companies conducting business in Greece must comply with specific VAT obligations, including invoicing requirements, maintaining proper records, and meeting reporting and submission deadlines. Adhering to these obligations is essential for businesses to avoid potential penalties and maintain compliance with Greek tax regulations.

Invoicing requirements

Greek businesses must meet specific invoicing requirements when conducting transactions. These requirements include issuing VAT invoices for supplies made to other taxable persons and legal entities, and retaining such invoices for a period of six years. Electronic invoicing is permitted but not obligatory, and electronic invoices must contain the same information as paper invoices.

In addition to these general invoicing requirements, businesses are also required to use the myDATA platform for tax data transmission and online tax bookkeeping. Created by Greece's tax authority, it digitizes business tax declarations and accounting information.

Record-keeping and storage

Businesses in Greece are obligated to maintain records of all transactions and store them for a minimum of six years. These records must incorporate information such as the date of the transaction, the amount of the transaction, and the amount of VAT charged.

Proper record-keeping and storage of tax records are essential for businesses to adhere to Greek VAT regulations and ensure compliance. By maintaining accurate and up-to-date records, businesses can avoid potential penalties and ensure they're prepared in the event of a tax audit or investigation.

Reporting and submission deadlines

VAT returns in Greece must be submitted electronically, with payment due by the last working day of the following quarter. Failure to comply with these deadlines can result in penalties, including fines and interest charges.

To avoid these penalties, businesses must ensure they meet the reporting and submission deadlines for their VAT returns. By staying organized and maintaining accurate records, businesses can efficiently submit their VAT returns and payments on time, ensuring compliance with Greek tax regulations.

VAT refunds and recovery in Greece

Non-resident companies operating in Greece can recover VAT on expenses incurred in the country, subject to certain conditions and procedures. The process for reclaiming and recovering VAT in Greece involves submitting VAT return forms and following the necessary procedures established by the Greek tax authorities.

The timeline for VAT refunds and recovery in Greece varies depending on individual cases, but the Tax Administration typically determines the timeline for VAT refund requests filed by taxable persons not established in Greece within a period of four months from the receipt of the request.

By understanding the VAT refund and recovery process in Greece, non-resident companies can ensure they recover any eligible VAT and minimize their tax liabilities.

Ecommerce and digital services VAT in Greece

Ecommerce businesses and digital service providers operating in Greece must comply with Greek VAT regulations, which may include registering for VAT. To sell digital products in Greece, ecommerce businesses can register with the One-Stop Shop (OSS) scheme, which simplifies the VAT registration process for businesses operating in multiple EU countries.

With the OSS scheme, everything is done in one place, making VAT compliance easier, not to mention saving time and resources, for those doing business in more than one EU Member State.

Intrastat and VIES declarations

Greek companies trading within the European Union must submit Intrastat and VIES declarations to provide information on intra-community transactions. These declarations are submitted electronically through the special Taxisnet network, and the deadline for submitting Intrastat declarations is the 26th day of the month following the reporting period.

By submitting Intrastat and VIES declarations, Greek businesses trading within the EU provide valuable information on intra-community transactions, which helps the Greek tax authorities monitor and regulate cross-border trade.

Penalties and compliance measures

Failure to comply with Greek VAT regulations can result in penalties being imposed, including fines and interest charges. For instance, a fixed penalty of €100 is imposed for late filing of VAT returns, including nil returns. Additionally, penalties apply for late payment of VAT, with an interest rate of 8.5% per annum.

To avoid these penalties, businesses must ensure they're fully compliant with Greek VAT regulations, including registration, invoicing, record-keeping, and reporting requirements. By staying informed about the latest VAT news and requirements, businesses can proactively address any potential compliance issues and mitigate the risk of penalties.

Assistance with Greek VAT compliance

Businesses seeking help with Greek VAT compliance can turn to tax advisors, fiscal representatives, or VAT compliance specialists. These professionals can provide valuable guidance and support in navigating the complex world of Greek VAT regulations, ensuring businesses meet their VAT obligations and minimize the risk of penalties. By seeking assistance from professionals, businesses will be able to confidently navigate Greek VAT requirements and focus on their core operations.

Conclusion

Understanding and complying with Greek VAT regulations is crucial for businesses operating in Greece, which is why it's so important to stay up-to-date with any changes to VAT rules and regulations. Something a tax specialist can assist with.

Do you need help with your VAT compliance? Book a free call with one of our VAT experts to find bespoke solutions for your business, optimize your VAT costs, and reach millions of new potential customers.

Frequently Asked Questions

Is VAT 24% in Greece?

Yes, the standard VAT rate in Greece is 24%.

Is Greece in the EU for VAT?

Greece has implemented the European VAT Directive, making it part of the EU VAT system. Along with this, the Greek Value Added Tax regime has been in place since 1987.

Can I claim VAT back from Greece?

Yes, if you're a VAT-registered company in an EU Member State and have conducted cross-border transactions in another Member State where you're not VAT registered, you can recover the VAT according to the full rules laid out in Directive 2008/9/EC.

These rules allow you to reclaim the VAT you've paid on goods and services purchased in another Member State. The process for reclaiming the VAT is relatively straightforward and can be done online. You'll need to provide evidence of the transactions and the VAT paid, as well as other relevant information.

Are there any reduced VAT rates in Greece?

Yes, there are reduced VAT rates of 13% and 6% for certain goods and services in Greece.