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ownership and the non establishment or abolishment of
any other real right. Mortgages are not recorded, but are
registered in special Books of Mortgages. There are two
different recordation systems in Greece; the system of Land
Registry Office (‘Ypothikofilakio’) and the system of Hellenic
National Land Registry (Cadastre, ‘Ktimatologio’).
COMMERCIAL LEASES
• Leases can be signed between parties either in a private
document or in a public deed executed before a notary public.
There is no obligation to register a private agreement yet
submission to tax authorities is mandatory.
New Leases as of February 28th 2014
• According to Law 4242/2014 Article 13, leases concluded
after February 28th 2014 will have a minimum term of three
years even if they were concluded for a shorter or indefinite
period. Such leases may be amicably terminated at any time
by virtue of a newer agreement signed between the landlord
and the tenant evidenced by a document bearing a certain
date. All matters concerning commercial leases may be
freely negotiated and agreed between the parties subject to
the provisions of Greek Civil Code and the provisions of the
Presidential Decree 34/1995.
Existing Leases before February 28th 2014
• Lease agreements signed before February 28th 2014 have a
minimum duration of 12 years plus an extension of 4 years.
According to Law 3853/2010 Article 17 the tenant has the
right to terminate the lease after the first year with a three
month notice and one month’s compensation.
Rent Reviews
• The common practise in Greece is that rent is renewed
annually by either a fixed rate or a rate over and above the
officially announced CPI. For retail use properties the adoption
of turnover rent is widely accepted.
TAX
Acquisition of real property
• For land and buildings constructed prior to 1/1/2006: transfer
tax at 3% calculated on the tax value of the property or the
value depicted in the deed, depending on which is higher.
• For buildings constructed after 1/1/2006 and are sold by the
developer: value added tax (VAT) at 23% calculated on the
sales price (cannot be lower than the tax value or building
cost).
• The buyer is liable for paying notary public and registration
duties.
Holding of real property
• Taxes on the ownership of real property may be divided in two
main categories:
Taxation of rental income
• For individuals the annual rental income up to €12.000 is
taxed at 11% and any income above that at 33%. For corporate
investors the rental income is deemed as business income
and is taxed at the prevailing 26% rate. It is also noted that
commercial leases are either subject to VAT (currently at
23%) or to 3.6% Stamp Duty.
Capital ownership taxes
• The capital ownership tax is comprised by the main tax and
the supplementary tax. The main tax is computed on a per
property basis whereas the supplementary tax is computed
on the total tax value of the property held. The main tax
is computed taking into account a variety of factors and
the supplementary tax for individuals range from 0.1% of
total property value of €300k to 1% for total property value
exceeding €1 mil. For corporate owners the tax is 0.5% on the
total value of the property which is not self-used by the owner.
Disposal of real property
• A Greek tax resident-individual owner selling real property is
subject to a 15% tax on the capital gain derived from the sale
with certain exceptions depending on the holding period of
the asset. The same tax applies if the object of the sale is a
company whose value significantly comprises from real estate
(>50%). For corporate owners, the gain from the sale of real
property is deemed as business income and is subject to the
prevailing 26% corporate income tax rate.
Real Estate Investment Companies (REICs)
• These are limited by shares companies established with a sole
aim to acquire and manage real estate property according to
international practise. Greek REICs are practically excluded
from all taxes and are subject to a special tax which depends
on the ECBs main interest rate (10% of the ECB’s main
interest rate plus 1%). REICs given their privileged tax regime
are becoming a growing investment vehicle in a growing
investment market.
46 Investors Guide to Europe 2015