Transfer of tax residence abroad
According to Article 4 par.1&2 of the New Income Tax Code (Law 4172/2013):
1. A natural person is a tax resident of Greece, as long as: a) it has its permanent or main residence or habitual residence or the center of its vital interests, which is to say its personal or economical or social links in Greece…. 2. A natural person that stays in Greece continuously for more than one hundred and eighty three (183) days, with small periods of staying abroad included, is a resident of Greece for tax purposes since the first day of its presence in Greece
The Tax Offices are fairly “constrained” on the acceptance of the transfer of the tax residence of natural persons abroad. In particular, the relevant burden of proof now lies with the taxpayer, who must prove that he has transferred his family, labor and vital interests abroad.
In relation to the needed documents and the followed procedure there are issued from time to time several Decisions by the Ministry of Finances (hereafter “Circular” (POL), which provide relevant clarifications. However, the Tax Offices often request the submission of complementary documentation, by which the transfer of the taxpayer’s vital interests to the foreign country (e.g. residence rental contract, water and electricity supply bills, work certificate etc.) is undoubtedly proven.
According to the recent Circular no (POL) 1058/18.03.2015 and the “Foreign Residents Guide on Taxation and Customs Issues” by the General Secretariat of Public Revenue of the Ministry of Finance, issued on April 2015, the procedure and documents needed for the transfer of residence for tax purposes abroad are the following:
1. The natural persons, who wish to transfer their tax residence abroad, have to submit to the competent Department or Office of the Tax Office whereto they are obliged to submit their income tax return as tax residents of Greece until the last workday of the first ten (10) days of March of the tax year following the tax year of departure, the latest, the following documents:
a) a M0 Tax Form accompanied (attachments) by the completed TAX forms M1 (“TIN return statement/Changes of Personal Data”) and M7 (“Taxpayer’s Representation Statement”) and
b) a Solemn Declaration In Writing (with the authenticity of the signature certified) about the appointment of a tax representative in Greece, since the Law requires such an appointment, which is to say the appointment of a permanent resident of Greece who all the notifications of tax acts, decisions etc. will be sent to. The said person must accept this appointment without prejudice, lest the transfer of tax residence will not proceed.
2. The official of the Tax Office receives the above documents and completes the relevant electronic application concerning the change of tax residence.
3. Later on and the latest until the last day of the first ten (10) days of September of the tax year that follows the tax year of departure, the following documentation should be also submitted to the above competent Department of the Tax Office:
a) a Tax Residence Certificate issued by the competent tax authority of the state the person declares to be a resident of, which proves that it is a tax resident of that state.
If there is a Double Income Taxation Avoidance Contract between the state the natural person is resident of and Greece and that person is acquiring income in Greece, it is able to submit, in place of the above certificate, the relevant Double Income Taxation Avoidance Contract Appliance Petition, which incorporates the tax residence certificate (bilingual forms) or
b) an income tax return clearance copy that the natural person has submitted to the other state or,
c) in the absence of a clearance, a relevant income tax return copy or
d) in case the presentation of some of the above mentioned documents is impossible, a certificate by any other public or municipal or other recognized authority is needed, which proves the natural person’s strong relation to the other state (“vital interests center”).
The authenticity of the documents described above must be certified, according to the provisions of the Hague Convention (Apostille). A formal translation of the documents in the Greek language is also mandatory.
4. The Tax Office is obliged to respond within two (2) months from the submission date of all the documents described above.
If the tax residence transfer petition is approved and the natural person is considered as a foreign tax resident, the above mentioned Tax forms (M0-M1-M7), the Solemn declaration in writing for the appointment of a tax representative and the relevant approval are forwarded to the competent Department of the Tax Office, in order for the relevant changes to be registered. The certificate of change is sent by post to the tax representative.