How can an Umbrella Company Help with Contracting in Greece?
Most freelance workers aren’t superheroes who successfully tackle these issues all on their own. There are companies who specialise in helping workers make the most out of their contracts.
They’re called Umbrella Companies (or, contractor management companies).
Basically, an Umbrella Company acts as your full-time employer, even though you maintain your independence as a contractor. They collect and filter payments from your clients, filtering out the necessary social security and fees. You send them your timesheets, and they send you payments.
Because they act as your “employer,’ they can sponsor you and provide a single work permit for multiple contracts in Greece. Even better, most are experts in Greece and expat tax law, meaning they’ll also help you optimise your earnings in Greece.
Although the Umbrella Company is technically your “employer,” you’re essentially freeing yourself to work even more independently. You still dictate your contracts, your hours, your schedule. The Umbrella Company simply filters out the time-consuming admin and immigration issues, allowing you to focus on your new contract.
Can I Organise My Taxes and Work Permit Myself?
Generally, you need to have an employer sponsor in order to secure the appropriate work permit and work visa for Greece.
If you’re working independently, it can be difficult to find clients willing to sponsor you. Moreover, even if your client can do this, you’ll need a new sponsor each time you decide to take on a new contract. Of course, every new sponsor will mean more paperwork.
Also, are you familiar with the intricacies of the tax system in Greece, as well as your own country’s laws on overseas earnings? If so, good on you!
However, if you’re like the rest of us, figuring out (much less reducing) your tax liability in Greece and your home country can seem like full-time work in itself.
A Contractor’s Guide to Taxes in Greece
One of the most consistently challenging aspects of contracting in Greece is complying with the country’s tax system. As well as paying tax in Greece, you might also still be eligible to pay some tax in your home country, and understanding the legislation behind this can be a challenge.
How do I calculate my taxable income in Greece
If you’re working in Greece under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in Greece for you and then send you a net wage. Your income tax, public health insurance, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in Greece, but contractors may not be offered this service because of their short stay with each employer.
Anybody who can’t pay their tax in Greece through PAYE is left with the prospect of doing everything themselves.
Do you know much about Greek Tax Law? Does Greece have a tax treaty with your home country? You will need to find out or find someone who can help! Income tax in Greece can range from 22 to 45 percent, and you need to be sure you are placed in the correct tax brackets.
Tax Filing as a Contractor in Greece
|When Do You Need to Lodge Your Tax Return?||Tax returns may be lodged from 1 February.|
|Tax Filing Deadline||Usually 30 June. The deadline for filing Form E1 (basic declaration) is announced each year by the Ministry of Finance.|
|Can you file it online?||Yes, https://taxisnet.mof.gov.cy/login.jsp|
How to File Taxes in Greece as a Contractor
Taxes in Greece must be filed electronically via TaxisNet using your AFM number. This site is only in Greek. If you face language difficulties, your local tax office can help with filing your return. If you’re outside of Greece and have no AFM or cannot file online, you must come to Greece yourself or have a ‘Limited Power of Attorney’ drawn from your nearest Greek consulate authorising a third party to request an AFM and file forms E1 and E9 on your behalf. The process of filing taxes yourself involves:
Step 1: Register for a Greek tax number (AFM) at your local Greek Tax Office (Eforia). Documents to bring include:
- Original passport and photocopy of passport.
- Original birth certificate and photocopy.
- Marriage certificate if married.
Step 2: Register for a TaxisNet account here(link is external) by filling in the required fields. Your Taxpayer’s Identification Code is your A.F.M. number.
Step 3: Log into TaxisNet(link is external) using your username and password.
Step 4: File Form E1 which is the regular Greek income tax return. Late filing would incur fines up to EUR 100. To fill out this form, evidence regarding the following should be collected:
- Income from pension
- Income from rent
- Income from interest on deposits
- Information relating to property and cars
- Loans taken out
Step 5: File a property declaration form (Form E9) if your land or property holdings have changed in any way. This may be if you:
- Buy property,
- Sell property,
- Transfer property,
- Inherit property or,
- If your family situation changes – divorce, dependency of children, death.
Step 6: If you have any tax due, you can choose from two options to pay it off.
- Pay the full amount as one lump sum on the last business day of July
- Pay in 3 equal bi-monthly instalments, with the first due by the last business day of July and the remaining by the last business day of September and November.
Relevant government websites:
- Ministry of Finance: https://www.minfin.gr/(link is external)
- Tax Department: https://www.mof.gov.cy/mof/tax/taxdep.nsf/index/index?opendocument (link is external)
Tax Figures in Greece
|Tax-free Threshold in Greece||None|
|Income Tax Rates||
Personal tax in Greece is levied at progressive rates according to the above table.
An additional special solidarity tax contribution also applies. This is imposed on both local and foreign income of Greek residents and Greek-sourced income of foreign residents. The following progressive tax rates are applied:
Severance payments are taxed at the following rates:
Tax Residency in Greece
When do you become a tax resident in Greece
You become a tax resident in Greece when:
Individuals are considered a Greek tax resident if they satisfy any of the following:
- Their centre of vital interests is in Greece (that is their domicile).
- Their habitual abode is in Greece. This is satisfied if the individual spends more than 183 days in Greece (short stays outside Greece are included in the 183 days).
- After 183 days, the individual will be deemed a Greek tax resident as of the beginning of the 183 day period. If they are also considered domiciled in Greece then they will be taxed for the full year as a Greek tax resident.
- The 183 day rule does not apply to individuals coming into Greece for ‘medical, tourist or similar private purposes and staying in Greece for more than 183 days but less than 365 in a calendar year.
Does the 183 day rule apply in Greece
Yes, subject to the conditions above.
Am I taxed on my global income in Greece
Yes, if you are a tax resident. Non-residents are taxed on their Greek-source income only.
Can you set up your own Limited Company in Greece?
|How long does it take to set up||12.5 days|
|How much does it cost||EUR 350|
|Is it easy?||Starting a Business Rank: 37 (Source: World Bank)|
Tax Calculator in Greece
If you are a contractor and want a calculation on your tax and net retention in Greece, we can supply it to you free of charge.
Using an Umbrella Company for Income Tax in Greece
Contractors in Greece are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. A Greek umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).
The companies are experts in Greek taxation, and they’ll ensure that you keep the largest proportion of your earnings whilst complying with local laws. They can deal with any issues with the Greek tax office or tax department directly including processing your tax refund if you are eligible.
How We Can Help You with Tax in Greece
We work with numerous umbrella companies in Greece, many of whom are experts in tax and immigration laws. If you have any questions about tax in Greece, we’ll get the answers from them directly so you can rest assured you’ll be getting accurate information. We have comprehensive knowledge of the different services they provide, and can help you find the right company to handle your income tax. We help oil and gas workers, software developers, IT project managers, testers, business analysts and telecommunications contractors get tax efficient payments and sponsorship for their Greek work permit.
Our advice is 100 percent free, and comes with no obligations. You will be paying taxes in Greece but without the overhead of directly dealing with the Greek tax authorities. Get in touch with us today for some reliable advice on tax in Greece!
A Contractor’s Guide to Work Permits in Greece
Immigration is one of the primary concerns for any contractor hoping to start working in Italy. Permanent employees will find it easy to get their Italian work permit because they’ll receive “sponsorship” for their entire stay from their prospective employer.
The Italian work permit, more commonly know as the visto e permesso, is dependent on this sponsorship because it confirms that you’ll be earning money during your stay in the country. Contracting in Italy is more difficult because the work permit is tied to one employer, so you have to change it to suit each new contract. Thankfully, umbrella companies provide a convenient and effective solution to this issue.
How Does an Umbrella Company Work?
Most people want to do their work, earn their money and enjoy their spare time without taking on loads of admin in a new country. That is why an umbrella company can help.
When you’re working through an Umbrella Company, you’ll essentially be outsourcing the admin and tax issues to specialists.
While the umbrella company will charge a fee, you’ll likely end up saving more money in the long run: you’ll be able to focus on your work, expertly reduce your tax liability, and comply with all laws and regulations in Greece (which means avoiding fees, fines, or even worse penalties).
How Can We Help You?
There’s a huge variety of Umbrella Companies with different specialities and advantages in Greece. How do you find the right one for your circumstances?
We work closely with Umbrella Companies all throughout Greece and match contractors with the right company for them. If you’ve already secured a contract in Greece, we can help you find your best match (for free). Or, we can simply give you feedback on your situation (for free).