2023-11-16-KPMG_Global-Greece_–_New_Guidelines_on_Tax_Residency_3页_265kb

Greece: New Guidelines on Tax Residency Circular Ε.2064/2023

Key Announcement

The Greek Independent Authority for Public Revenues (AADE) issued Circular Ε.2064/2023.
This circular provides updated guidelines for the implementation of provisions concerning the tax residence of individuals.

Core Changes & Definitions

• Defines "permanent residence", "habitual abode", and "centre of vital interests" with more clarity.
• Clarifies "centre of vital interests": Requires an overall assessment of an individual's personal and economic ties, considering actual facts.
• Provides detailed guidance on calculating days of presence in Greece and determining the first tax resident year obligation.

Impact

• Can affect globally-mobile employees' Greek tax status and determine international taxing rights, impacting assignment planning and double taxation treaty application.
• Impacts income tax filing status (worldwide income declaration obligation).
• Employer obligations (e.g., tax equalization) may depend on the employee's tax residency status.

Other Clarifications Provided

• Procedures for resolving dual tax residence situations.
• Tax authorities' obligation to provide specific reasons for deeming someone a tax resident and bear the burden of proof.
• Procedures for changing tax residence after departure, using existing circulars, and document requirements.
• Taxpayers' obligation to keep documentation proving Article 4 ITC criteria for potential future audits.

KPMG Note

Highlights the complexity of changing tax interpretations and recommends discussing residency (among other issues) with employees before or during international assignments, possibly referencing the Council of State's relevant decisions.