It is said that there's nothing certain except death and taxes. I suppose death is inevitable wherever you are, but here in Greece paying taxes seems to be a lot less certain. March/April is the time of year when those who must, need to prepare and file their tax returns. I think taxes are a bureaucratic nightmare no matter what country you live in. In the UK it has been simplified of late by the use of the internet, although if your finances are anything other than a simple record of earnings and expenses it's wise to get professional help. They are catching up rapidly in Greece as well; recently the government said that from this year certain people had to file on-line, but a third party, such as your accountant, couldn't do it for you unless you signed a form at the tax office. For a foreigner in Greece having an accountant is almost an absolute requirement. Apart from the fact that you are just not familiar with them, the rules are very very complex and the forms require a lot more than just a smattering of Greek. There are detailled instructions available courtesy of the Athens News book "Surviving Greek Bureaucracy", but I'm not sure how advisable it is do it for yourself, as you can be required to declare and may be liable for tax on almost anything here.
If finding anything and everything possible to tax is the main occupation of government, especially now, then avoiding paying tax is the national pastime. It's not unusual, as borne out by recent investigations, for highly paid professionals to declare incomes of less than €12,000 (the personal allowance here). Mind you, it's quite amazing what personal assets can be set against earnings for tax purposes. While the ownership of an expensive car, for example, will indicate (officially for tax purposes) a certain minimum income, the purchase and value of the car can be declared as an allowable expense. Although it benefits from tourism in the summer, we live in a fairly poor rural area. There's not much employment now; even the building trade which usually takes on Albanian stone masons and labourers is virtually at a standstill, and if it wasn't for the foreigners living here with their imported money the place might not survive in winter. Nevertheless, a high proportion of the local population drive around in 4x4s, pick-ups and other large cars. To be fair, the rest have either just a moped or no vehicle whatsoever.
Given the current economic crisis the Greek government has been trying to stop tax evasion and has introduced many new taxes to raise revenue. Some of the schemes seem a bit cumbersome and bizarre, others tend to add to the bureaucracy that is at the heart of Greece's problems. Last year they introduced a requirement that taxpayers save and produce receipts from their household expenditure; a certain percentage according to their income. The idea was to make sure businesses actually issued receipts from their tills which, by the way, are registered by the government and therefore officially record takings. However, from the tax payers point of view, surely, if you want to declare that you only earn a certain amount then you only produce receipts for the appropriate percentage of your declared income and no more. Of course, if you install a swimming pool or buy a €70,000 car then the tax man might find you out!
If finding anything and everything possible to tax is the main occupation of government, especially now, then avoiding paying tax is the national pastime. It's not unusual, as borne out by recent investigations, for highly paid professionals to declare incomes of less than €12,000 (the personal allowance here). Mind you, it's quite amazing what personal assets can be set against earnings for tax purposes. While the ownership of an expensive car, for example, will indicate (officially for tax purposes) a certain minimum income, the purchase and value of the car can be declared as an allowable expense. Although it benefits from tourism in the summer, we live in a fairly poor rural area. There's not much employment now; even the building trade which usually takes on Albanian stone masons and labourers is virtually at a standstill, and if it wasn't for the foreigners living here with their imported money the place might not survive in winter. Nevertheless, a high proportion of the local population drive around in 4x4s, pick-ups and other large cars. To be fair, the rest have either just a moped or no vehicle whatsoever.
Given the current economic crisis the Greek government has been trying to stop tax evasion and has introduced many new taxes to raise revenue. Some of the schemes seem a bit cumbersome and bizarre, others tend to add to the bureaucracy that is at the heart of Greece's problems. Last year they introduced a requirement that taxpayers save and produce receipts from their household expenditure; a certain percentage according to their income. The idea was to make sure businesses actually issued receipts from their tills which, by the way, are registered by the government and therefore officially record takings. However, from the tax payers point of view, surely, if you want to declare that you only earn a certain amount then you only produce receipts for the appropriate percentage of your declared income and no more. Of course, if you install a swimming pool or buy a €70,000 car then the tax man might find you out!
As foreigners who were buying a house we have had to file annual tax returns since we started. Our lawyer found us an accountant to handle this; only they haven't for the last two years! They did the return for the first year when we bought the land, but they've not done the subsequent ones. We have given them all the information about the money we brought into the country and paid Vasilis, our builder, but he (or rather, his wife) hasn't yet supplied us or them with the receipts for the build. Failure to file a return incurs a €50 fine each time. When I talked to Vasilis about this he told me not to worry; it will all be sorted when they formally hand over the house to us, but it's advantageous to us and to him, particularly in the current climate, to delay this as long as possible because of the taxes and other payments that become due. He assured me that he's been doing this for 30 years and it will all be fine. How long he can wait before handing over the property is linked to the electricity supply. Your house can be on "builder's electric" (power supplied via the builder) for up to 3 years from the start of the build or longer if the builder can demonstrate that the property is not finished (I wondered why some things just hadn't been done). The electric company (ΔΕH) does all the inspections for tax purposes and levys the taxes, and can demand the house be finalised and the electric transferred over so that the owner becomes the direct customer. By the way, electricity bills in Greece also include your TV licence and the equivalent of council tax. We await ΔΕH sending us a letter some time in the future for all this to happen. Meanwhile our tax returns are not being done.
Now I realise that you may feel that we've got ourselves into a risky situation with our builder. And, indeed, we know of other people who have ended up in court, enduring long battles with their builders, because things haven't been done right. Some builders do like to settle everything directly as soon as they've completed the build, but they seem to be in the minority. Apparently our situation is about the norm for here. Although this approach is strange to us, it is legal and we do still trust Vasilis, even though he can be very elusive and evasive. The biggest niggles with him are difficulties in contacting him, things not being done and, most of all, the issue of communication. He only ever tells you what he thinks you need to hear. He's quite parochial and protective of his customers (so long as he's still friends with them) and doesn't seem to realise that we want to know and understand everything that concerns us.
Not being Greek it seems that some form of tax being charged to us is inevitable, but not just yet. By then we may have learned how to be a bit more Greek and will have found a way to avoid paying it.
