Company abroad, life in Greece: Where are you actually taxed?

Company abroad, life in Greece: where are you actually taxed?

Remote work and digital services allow a professional to live in Greece, serve international customers and have a company abroad. The country of establishment of the company, however, does not in itself determine all tax obligations of the company and its owner.

Personal tax residence

The tax residence of an individual is examined separately from that of the company. The relevant factors include permanent or main residence, habitual residence and the centre of vital interests, meaning personal and economic ties.

The 183-day threshold is not the only criterion. Spending fewer days in Greece therefore does not automatically rule out Greek tax residence. When two countries claim that a person is tax resident, the rules of the applicable double taxation treaty are examined.

The effective management of the company

A company established abroad may face a question of Greek tax residence if its effective management is exercised in Greece.

For example, when the manager makes key business decisions from Athens and effectively runs the company, its foreign registered office is not enough to rule out Greek taxation.

The assessment is based on how the company actually operates as a whole and on the applicable international treaty. The shareholder’s residence in Greece is not enough on its own. Nor does an occasional video call or signature from Greece automatically lead to a change in tax residence.

A separate assessment considers whether the activity in Greece creates a permanent establishment, giving rise to tax obligations on the profits attributable to it.

Income from abroad

As a rule, a Greek tax resident is taxed on their worldwide income, subject to specific provisions and international treaties. Paying tax abroad does not automatically remove the obligation to declare that income in Greece.

Before establishing a foreign company or moving to another country, a comprehensive assessment of personal residence, corporate management and income is needed. Comparing tax rates is only one part of the decision.

Written by Christina I. Kapela
Tax consultant, Business adviser

CK Accounting & Tax Services
https://ck-taxservices.gr