New Tax Provisions Law 5162/2024

Income Enhancement Measures, Tax Incentives for Business Innovation and Transformation and Other Provisions

Find below the briefing of new provisions of the new Law 5162/2024 (Government Gazette No. 198/5/12/2024) as well as their enactment time:

• Abolition of the professional fee for self-employed individuals and freelancers. Implementation from the year 2024.
• Voluntary benefits granted from employers to employees up to €5,000.00 per year and are paid within 12 months following the birth of a child, are exempted from the calculation of the taxable of employees. An additional €5,000.00 is added to this exemption for each dependent member and the incentive is applied to benefits paid from 2024.
• Tips for amounts of up to 300,00€/month are exempted from income tax as well as from social contributions with no amount limit. Application from November 1, 2024.
• Calculation of minimum net income generated from business activities, is modified. Specifically, the employee’s higher wages are considered distinctly from other retribution earned in this calculation. Implementation from the year 2024.
• Minors’ health insurance contracts are exempted from premium taxation, starting 5/12/2024.
• Pensioners solidarity contributions calculation is corrected by adjusting the limit of each category of calculation of the contribution in proportion to the annual increase of the pension. The measure aims at the protection of their income and is applied from 1/1/2025.
• The amount of the climate resilience tax, intended to cover needs arising from the consequences of climatic change, is modified. Effective from tax year 2025.
• Insurance against natural disasters will be mandatory for businesses with annual gross revenues of €500,000 and above (against the €2,000,000 limit that was applied previously), aiming at property protection. The provision is valid from 1/6/2025.
• A common decision expected to be issued after January 2025 provides for a new tax to be imposed on cruise travelers, per port and passenger. Relative revenues will be channeled to support local communities, receptors of above tourists.
• Abolition of fixed telephony subscriber fee for optical fiber contracts of speed> 100 Mbps, starting from 1/1/25.
• One off taxation of on-call duty fees of NHS medical staff. Implementation from the year 2025.
• Properties that were vacant or leased for short-term in the years 2022, 2023, 2024, are exempted from taxation for three years following an eventual lease concluded between 8/9/2024 and until 31/12/2025. The same are retroactively taxed in case of termination of the new lease. Instructions for the implementation of the new provision are on the way.
• The doubling of the discount – from 10% to 20% – in the ENFIA (Property Tax) of the properties, insured against natural disasters, i.e. flood, fire and earthquake and of a taxable value of up to €500,000. The provision is valid from 5/12/2024.
• Reduction of employer insurance and employee health care social contributions by 1%, i.e. 0.50% of employer contributions and 0.50% of employee contributions. The provision is valid from 5/12/2024.
• Prohibition of short-term leases in the year 2025, for properties located within the boundaries of the 1st, 2nd and 3rd Athens municipality districts. A fine of 50% of the income resulting from the short-term rental will be imposed and the fine amounts will be no less than €20,000.
• Incentive amplification for scientific and technological research expenditure for companies registered in the National Start up registry. The provision applies also for research centers, institutes or universities. In the expenditure, amortization of dedicated equipment is added. The relative discount is considered in gross business earnings at the time of conclusion of the expenditure which is increased by 150%. Implementation year 2025.
• Provision for tax incentives concerning angel investors (defined in the common decision no. 39937/21 of the Deputy Ministers of Finance, Development and Investments and the Administrator of the Independent Public Revenue Authority) for support funds payment to start-up companies, with an increase of the maximum investment limit from €300,000.00 to €900,000.00. Implementation from the year 2025.
• Full income tax exemption of profits derived from patent exploitation for the first 3 years. Added to this exemption is an additional exemption from taxation at a rate of 10% for profits from patent exploitation for the following 7 years.
• Closed-end mutual funds new taxation calculation. The calculation takes into consideration the difference in value of the capital holdings at 31/12 of every accounting year as compared to the value of acquisition of these holdings. The application rate is of 10% on the currently applicable Euro system interest rate of the European Central Bank, for principal operations. Implementation from the year 2025.
• New Income Tax declaration submission deadlines. The new submission dates for individuals and legal entities are set from 3/15 to 7/15 of each year.
• Extension of VAT exemption for newly built properties up to 31/12/2025.
• Extension of capital gains tax exemption, in property transfers until 12/31/2026.
• Lost debt settlement by liable individuals. Jointly liable individuals may now continue servicing adjusted debts’ settlements using their own means. Application from 5/12/2024.
• Extension of the capital gains and dividends tax exemption resulting from shareholdings transfers (articles 48 and 48A of Law 4172/13). This applies also to subsidiaries established outside the EU. The provision is valid from 5/12/2024.

For more clarifications and information therein, please contact our firm’s representatives, Messrs. Dimitrios Leventakis, Tel. +30 6948 600 643 & +30 210 38 42 325 and Anastasios Eftychopoulos, Tel. +30 210 38 42 325.