Ecovis Global > Capital gains tax Greece: Introduction of deferral for individuals and the contribution of shares
Capital gains tax Greece: Introduction of deferral for individuals and the contribution of shares
8. June 2023
The recently enacted Law No. 5024/2023 is anticipated to offer a strong incentive for the establishment of holding companies in Greece. The law provides for a deferral of capital gains tax on securities transactions which meet certain conditions. At the same time, it also amends certain previously applicable VAT regulations. The new law came into effect on 24 February 2023.
The new provisions will apply to Greek tax residents who contribute domestic or foreign securities, such as shares, to cover or increase the capital of Greek or foreign legal entities or persons in exchange for securities issued by the recipient in question.
The main conditions for applying the tax deferral
The contributor of the securities must be an individual tax resident in Greece and the sole shareholder/partner of the recipient legal entity
The recipient must be established in a tax cooperative jurisdiction (not necessarily in the European Union)
The scope of the recipient entity’s business objective must relate to commercial, production or agricultural activities, or the provision of services
Speak to us if we can support you with your investment plans and business start-up. Dimitrios Leventakis, Managing Partner, Certified Internal Auditor – IBFD Certified Tax Advisor, ECOVIS HELLAS Ltd., Athens, Greece
The practical effect of this amendment is that, for those cases meeting the above-mentioned criteria, capital gains taxation will only occur upon the actual transfer of the securities in question in the recipient entity that was acquired in exchange for the contribution, and not at the time of the contribution of the domestic or foreign securities, explain the Ecovis experts.
This new measure is a very welcome development that is expected to make setting up Greek holding companies an even more attractive and tax-efficient investment vehicle for high net-worth individuals.