Greece is one of the many countries throughout the world that implements a version of the value-added tax (VAT), which is a tax on consumer spending. The value-added tax, or VAT, is a consumption tax that is levied on both goods and services at every stage of the manufacturing and distribution processes. It is called a consumption tax because, in the end, the person who buys the products or services is the one who is responsible for paying it.
The Greek Ministry of Finance is in charge of regulating value-added tax, and the Independent Authority for Public Revenue is in charge of administering it. Businesses that conduct operations in Greece are obligated to adhere to the necessary VAT legislation because the value-added tax (VAT) is a significant contributor to the Greek government’s overall revenue.
How Does VAT Work in Greece?
In Greece, the value-added tax (VAT) is levied at varying percentages, depending on the type of product or service being purchased. There are three primary rates of VAT in Greece, and they are as follows:
- The rate of VAT that is typically used is 24%. This tax is levied on the vast majority of products and services, including consumables, garments, and electronic devices.
- The rate of 13% applies when the VAT is decreased. This tax is levied on some products and services, including publications like books and newspapers, as well as rides on public transportation.
- The rate of VAT that has been super-reduced is 6%. This tax is levied on absolutely necessary items and services, such as food, medicine, and power.
Businesses in Greece that are registered to collect VAT are obligated to include the tax in the prices of their products and services and pay the tax themselves on all of their transactions. The value-added tax (VAT) is collected from customers and referred to as output VAT, whereas the VAT that is paid on purchases and referred to as input VAT.
Businesses are required to provide the appropriate tax authorities with a VAT return at the conclusion of each tax period. This return details the total amount of output VAT charged to customers as well as the total amount of input VAT paid during the period.
A VAT refund may be requested from the government by a company if the amount of VAT on inputs is more than the amount of VAT on outputs. If a company’s total output VAT is greater than its total input VAT, the company is obligated to make up the difference to the relevant tax authorities. Greek VAT Number:
If you plan on conducting business in Greece, you will be required to obtain a VAT number from the Greek government. A VAT number is a one-of-a-kind identifier that is provided to companies who have successfully completed the VAT registration process. Its primary functions are to identify companies for tax purposes and to keep tabs on the VAT liabilities of those companies. You need to register with the Greek tax authorities before you may receive a VAT number.
Registering for VAT in Greece:
In Greece, registering for value-added tax (VAT) requires submitting an application to the appropriate tax office. The application must be made using Form E3, which can be obtained from the relevant tax authorities or downloaded from their website. You will be required to supply fundamental information pertaining to your company, such as your name, address, and taxpayer identification number.
In addition, you are required to supply information regarding the nature of your business activities and the transactions that you do. You also need to produce documentation that verifies your tax registration and that you are in good legal standing. When your application has been submitted, the relevant tax authorities will look it over, and if you satisfy all of the conditions, they will give you a VAT number.
VAT Refund in Greece:
If you are a non-resident of Greece or a foreign company doing business in Greece, you may be eligible to receive a VAT refund on the money you spent there for your company. However, requesting a VAT refund in Greece can be a complicated process, therefore it is essential to have a thorough understanding of the prerequisites and steps involved in the process.
Eligibility for VAT Refund:
In order to receive a VAT refund in Greece, you need to fulfill a number of requirements first. The first requirement is that you cannot call Greece your permanent home, and the second is that you cannot have any kind of permanent establishment or fixed place of business there. In addition to this, you are required to have incurred VAT costs in Greece on Greek goods and services that are directly relevant to the operations of your firm.
Procedures for VAT Refund:
In order to be eligible for a value-added tax (VAT) refund in Greece, your application must be submitted to the relevant tax authorities within six months of the end of the calendar year in which the VAT was paid. The application needs to be made using Form 1, which can be obtained from the relevant tax authorities or downloaded from their website. It is mandatory that the application be made using Form 1.
You need to show proof of the VAT that you have paid, such as invoices and receipts, as well as proof that you are qualified to receive a VAT refund. After receiving your application, the relevant tax authorities will evaluate it and may contact you with questions or a request for more information and/or documents.
In conclusion, the value-added tax (VAT) is an important component of the tax system in Greece, and it is imperative that enterprises that operate in Greece comprehend the requirements associated with VAT. This entails getting a Greek VAT number and conforming to the conditions set forth by the Greek tax authorities. In Greece, if you are eligible, you may also be able to get a refund on the value-added tax that you paid for your business costs there. However, the procedure for claiming a VAT refund can be difficult, which is why it is essential to obtain the advice and assistance of a qualified specialist.
It is vital to comply with the applicable regulations in order to avoid any penalties or fines. The Greek VAT system is supposed to be fair and transparent as a whole, and it is important to comply with these requirements. You may ensure that your company is in compliance with the applicable tax legislation and that it is running in an effective and efficient manner by gaining an awareness of the requirements of the Greek VAT system and seeking the counsel of a professional wherever it is essential to do so.
1. What is VAT?
The Value-Added Tax (often known as VAT) is a consumption tax that is applied to both products and services. It is a form of indirect taxation in which the ultimate consumer is responsible for payment, but the tax itself is collected and sent to the government by enterprises.
2. What is a VAT number?
A VAT number is a one-of-a-kind identifier that is provided to companies who have successfully completed the VAT registration process. Its primary functions are to identify companies for tax purposes and to keep tabs on the VAT liabilities of those companies.