A new package of tax measures passed by the Greek parliament includes changes in social security contributions and increases in income tax rates and the solidarity contribution.
The new package of tax measures and pension reforms was published in the National Gazette on Thursday 12 May 2016. The changes affect legal entities, employees, freelancers and pensioners.
New tax rate for individuals
- valid on income gained from 1 January 2016
Taxable income from employment, pensions and farmers is subject to tax in accordance with the following scale:
| Gradual income (euro) | Tax rate % | Incremental Tax (euro) | Total Income (euro) | Total Tax amount (euro) |
| 0 - 20.000 | 22 | 4.400 | 20.000 | 4.400 |
| 20.001-30.000 | 29 | 2.900 | 30.000 | 7.300 |
| 30.001-40.000 | 37 | 3.700 | 40.000 | 11.000 |
| 40.000- | 45 |
The resulting tax shall be reduced by €1,900 for individuals without children and income of not more than €20,000. The tax deduction amounts to €1,950 for individuals with one child, €2,000 for individuals with two children and €2,100 for individuals with three children.
If the applicable tax is less than the amounts mentioned above, the reduction confines itself to the corresponding tax. For taxable income that exceeds €20,000, the decline is reduced by €10 per each €1,000 of taxable income. Note: The above deduction does not apply for freelancers.
Solidarity contribution withheld
As per the following, new, scale:
| Income (euro) | Rate % |
| 0-12.000 | 0,0 |
| 12001-20.000 | 2,2 |
| 20.001-30.000 | 5,0 |
| 30.001-40.000 | 6,5 |
| 40.001-65.000 | 7,5 |
| 65.000-220.000 | 9,0 |
| 220.001+ | 10,0 |
Dividend
The withholding tax rate on dividends increases to 15% (from 10%).
Rental income
Rental income is now taxed as follows:
| Income | Tax rate % |
| 0 - 12.000 | 15 |
| 12.001 – 35.000 | 35 |
| 35.001- | 45 |
Νew tax rate on profits of personal companies (OE, EE etc.)
Α single tax rate of 29% now applies regardless of the amount of profit.
Social Security Contributions
The Social Security Contribution increases by 1% (0.5% for employers and 0.5% for employees) from 1 June 2016 until 31 May 2019 and by 0.50% (0.25% and 0.25%) from 1 June 2019 until 31 May 2022.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
