Greece's Flat Tax for Foreign Retirees and Investors

Greece has emerged as one of the most attractive destinations for tax-motivated relocation in Europe, thanks to two distinct programmes that offer flat-rate taxation on foreign income. The 7% retiree regime and the EUR 100,000 investor regime fill the gap left by Portugal's NHR abolition, offering Southern European lifestyle with meaningful tax advantages.

The 7% Flat Tax for Retirees: Article 5B of the Greek Income Tax Code

Introduced under Law 4714/2020, this programme targets individuals receiving pension income from abroad.

Eligibility

To qualify, the individual must:

1. Be receiving a pension or equivalent retirement income from a foreign source -- This includes state pensions, private pensions, annuities, and occupational pension schemes
2. Transfer tax residence to Greece from a country that has a Double Tax Agreement (DTA) or Tax Information Exchange Agreement (TIEA) with Greece
3. Not have been Greek tax resident for 5 of the 6 tax years preceding the application

Tax Treatment

• All foreign-source income is taxed at a flat 7% rate for 15 years
• This covers pensions, dividends, interest, rental income, capital gains, and any other foreign-source income
• Greek-source income is taxed at normal progressive rates (up to 44%)
• No additional solidarity contribution applies to income covered by the flat 7% rate

Application Process

1. File an application with the Independent Authority for Public Revenue (AADE) within the tax year of transfer or the following year
2. Provide evidence of pension income, prior tax residence, and transfer of residence to Greece
3. AADE issues an approval typically within 60 days
4. The individual files Greek tax returns annually, declaring all income and applying the 7% rate to foreign income

Practical Benefits

For a retiree receiving EUR 100,000 in annual foreign income (pension plus investments):

• Greek flat tax: EUR 7,000
• Compared to normal Greek rates: Approximately EUR 40,000+
• Annual saving: EUR 33,000+

Over 15 years, the cumulative saving is substantial, and the simplicity of a single flat rate reduces compliance costs.

The EUR 100,000 Investor Flat Tax: Article 5A of the Greek Income Tax Code

Also introduced under Law 4714/2020, this regime targets high-net-worth individuals who invest in Greece.

Eligibility

To qualify, the individual must:

1. Not have been Greek tax resident for 7 of the 8 tax years preceding the application
2. Invest at least EUR 500,000 in Greece within 3 years of the application, in one or more of the following:
   • Greek real estate
   • Greek business or business shares
   • Greek government bonds
   • Shares or units in Greek investment funds
   • Greek corporate bonds traded on regulated markets

Tax Treatment

• EUR 100,000 annual flat tax on all worldwide income, regardless of the amount
• EUR 20,000 per year for each additional family member joining the regime
• Duration: 15 years
• Greek-source income: Subject to the EUR 100,000 substitute tax (not taxed separately)
• No obligation to declare foreign assets or file the equivalent of Italy's RW section

Investment Verification

The EUR 500,000 investment must be verified by AADE. The investment can be made:

• Before the application (within the 3 years preceding)
• After the application (within 3 years of approval)

The investment must be maintained for the duration of the regime. Disposal and reinvestment in qualifying assets is permitted.

Economic Analysis

The EUR 100,000 regime is economically rational for individuals with worldwide income exceeding approximately EUR 300,000 per year. Below that level, normal Greek tax rates may be comparable or lower.

Worldwide Income	EUR 100,000 Regime	Normal Greek Tax	Saving
EUR 300,000	EUR 100,000	~EUR 120,000	EUR 20,000
EUR 500,000	EUR 100,000	~EUR 210,000	EUR 110,000
EUR 1,000,000	EUR 100,000	~EUR 430,000	EUR 330,000
EUR 5,000,000	EUR 100,000	~EUR 2,180,000	EUR 2,080,000

Comparing the Two Greek Regimes

Feature	7% Retiree Regime	EUR 100,000 Investor Regime
Target	Retirees with foreign pensions	HNW investors
Annual cost	7% of foreign income	EUR 100,000 flat
Investment required	None	EUR 500,000 in Greece
Prior non-residence	5 of 6 years	7 of 8 years
Duration	15 years	15 years
Family extension	Not specifically provided	EUR 20,000 per family member
Best for	Income under EUR 1.4M	Income over EUR 300,000

At EUR 1,428,571 of foreign income, the 7% regime equals EUR 100,000. Above that level, the investor regime is more efficient (but requires the EUR 500,000 investment).

Greek Tax Residency Requirements

To benefit from either regime, the individual must be Greek tax resident. Greece determines tax residency based on:

• 183-day rule: Presence in Greece for more than 183 days in a calendar year
• Centre of vital interests: If the individual's personal and economic interests are predominantly in Greece
• Habitual abode: If Greece is the individual's normal place of living

There is no requirement to spend a specific minimum number of days in Greece under the flat tax regimes themselves, but Greek tax residency must be established and maintained.

Inheritance and Gift Tax

Greek inheritance and gift tax applies to worldwide assets for Greek tax residents. Rates vary by relationship:

• Category A (spouse, children, parents): 1-10% with EUR 150,000 tax-free threshold per parent
• Category B (siblings, grandparents, in-laws): 5-20% with EUR 30,000 threshold
• Category C (all others): 20-40% with EUR 6,000 threshold

Neither flat tax regime provides an exemption from Greek inheritance tax. This is a material difference from Italy's regime, where foreign assets are exempt from inheritance tax for flat tax residents.

Banking and Practical Infrastructure

Greek banking has recovered significantly from the 2015 capital controls crisis. Major banks include:

• National Bank of Greece, Alpha Bank, Eurobank, Piraeus Bank -- All offer private banking services
• International transfers are unrestricted within the EU/EEA
• English-speaking private banking is available in Athens, Thessaloniki, and major islands

Lifestyle Considerations

Greece offers:

• Over 300 days of sunshine annually
• Among the lowest costs of living in Western Europe
• World-class islands and coastal living (Mykonos, Santorini, Crete, Corfu, Rhodes)
• Excellent healthcare (both public and private)
• International schools in Athens and Thessaloniki
• EU membership and Schengen area access
• Rich cultural heritage and active social scene

Common Mistakes

• Assuming the 7% regime applies to all income for non-retirees: The 7% rate is exclusively for individuals receiving foreign pension income. Working-age individuals with employment or business income do not qualify.
• Failing to maintain the EUR 500,000 investment: Under the investor regime, the investment must be maintained throughout the 15-year period. Selling without reinvestment can jeopardise the regime.
• Ignoring Greek inheritance tax: Unlike Italy, Greece does not exempt foreign assets from inheritance tax for flat tax residents.
• Not planning for post-regime taxation: After 15 years, all income becomes subject to normal Greek progressive rates (up to 44%). An exit plan is essential.

Key Takeaways

• Greece's 7% flat tax for retirees is the most competitive retirement tax regime in Europe, covering all foreign income for 15 years.
• The EUR 100,000 investor regime is best suited to HNW individuals with foreign income exceeding EUR 300,000, requiring a EUR 500,000 investment in Greece.
• Neither regime exempts foreign assets from Greek inheritance tax, unlike Italy's flat tax.
• Greece's combination of low tax rates, EU membership, affordable cost of living, and exceptional climate makes it a compelling alternative to Portugal's now-defunct NHR.
• Both regimes require genuine Greek tax residency -- the benefits are not available to individuals who merely invest without relocating.
• At foreign income levels above EUR 1.4 million, the investor regime is more efficient than the 7% retiree rate.