On 29.7.2020, the Greek Parliament voted law Nr. 4714/2020, which includes significant amendments to tax provisions. Pursuant to article 1 of the new law, a new article (5B) was added to the Greek Income Tax Code, which supplemented the framework of alternative taxation of the foreign-source income obtained by natural persons, who transfer their tax residence in Greece.

In specific, the new provisions enable natural persons that obtain a pension abroad to transfer their tax residence in Greece and request from the Greek tax authorities to be subject to an alternative taxation for all their income earned abroad, at a flat rate of 7%. With the payment of this tax, every tax liability of the natural person in Greece for this income derived abroad is exhausted, including the special solidarity contribution of article 43A of the Greek Income Tax Code. However, for the taxable income derived in Greece, the natural person is subject to income tax in Greece, according to the general provisions of the Greek Income Tax Code.

The application for the transfer of the tax residence and the implementation of the alternative taxation of the income derived abroad is submitted by the natural person to the tax authorities until March 31 of the respective tax year. Especially for this year’s applications, the deadline is set at 30.9.2020. Τhe decision Nr.1217/2020 specified the details of implementation of the above new provision.