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Employing in Greece

At a glance

Employment in Greece

Employment in Greece has constantly decreased since 2015 to 24.47%. The most common type of work contract in Greece is the full-time contract, with an indefinite duration. Part-time work isn’t common and the maximum length of a single fixed-term contract is 36 months.

There are several key areas to be aware of within the Greek employment regulatory framework, especially for companies that plan to initiate a full local office and human resources department.  These challenges can be mitigated by use of a locally sourced payroll provider who is familiar with all of the local laws and rules for both local employees as well as foreign nationals.

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Payroll & Tax in Greece

In 2014, Greece made paying taxes more costly for companies by increasing the corporate income tax rate; though it also reduced the employers’ contribution rate to the social security fund.

In 2016, however, Greece made paying taxes less costly for companies by reducing the rates for social security contributions paid by employers, making insurance premiums fully tax deductible and lowering property tax rates. At the same time, it defined entertainment expenses as nondeductible, reduced the depreciation rates for some types of fixed assets and increased the tax on interest income

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Immigration / Work Permits in Greece

Non-EEA nationals must obtain a work permit prior to staring their employment activity in Greece. Work permits in Greece are employer-specific (although there can be exceptions), occupation-specific, and location-specific, and are normally valid for one year.

A worker from a non-EU country must first obtain a visa to enter Greece and then apply for the residence/work permit once in Greece.

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Incorporation

Greek company law describes several ways for establishing a business and provides for companies incorporated in Greece to be either personal or capital-based. There are five main types of business available to foreign companies in Greece, namely:

  • The partnerships: General (“OE”) and Limited (“EE”);
  • The limited liability company (“EPE”);
  • The “societe anonyme” company (“AE”);
  • The new private limited company (“IKE”), introduced in Greek law in 2012.
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GEO Solutions or DIY Employment in Greece?

Companies entering Greece must make a decision whether to use their own resources for a Do-It-Yourself (DIY) approach, or to use a Global Employment Organization to handle payroll and employment responsibilities.  A GEO or Greece Employer of Record solution makes it faster, easier and cheaper to deploy staff if they don’t have a Greek entity established that can run payroll.

A DIY approach will typically take 6-9 months until there is a properly incorporated WFOE ready to run payroll and cost up to 6 figures if registered capital is required. Shield GEO can deploy foreign staff in 4-6 weeks and local staff in 48 hours. Additionally, Shield GEO is responsible for all compliance issues related to the employment.

Using Shield GEO Employer of Record Services in Greece

Payroll Greece
Management Fee for Employer of Record Services / Monthly Payroll Costs

Please contact us for a quote

Notes

Shield GEO pays the employee on a monthly basis, typically on the last working day of the month although we can adapt to your preferred schedule. Income tax and social security (where applicable) are deducted at source and paid to the local tax authorities.

 
Grossed income Tax Rate (%)
Up to € 25,000 22
Next € 17,000 32
Over 42

Liabilities for Greek income tax (and certain other taxes) depend on where you’re domiciled.

The domicile is normally the country regarded as permanent home and where a person lives most of the year. For example, a foreigner working in Greece for a Greek company who has taken up residence in Greece and has no income tax liability abroad, is considered to have his tax domicile in Greece.

The country of domicile is particularly important when it comes to inheritance tax. A person is considered to be a Greek resident and liable to Greek tax if any of the following apply:

– His/her permanent home, i.e. family or principal residence, is in Greece.

– He/she spend over 183 days in Greece during any calendar year.

– He/she is employed or carry out paid professional activities in Greece, except when secondary to business activities conducted in another country.

– His/her centre of vital economic interest, e.g. investments or business, is in Greece.

 

Tax Returns Supplied

Yes

Employers Social Security and statutory contributions

24.56% as of July 2014, calculated on gross salary

Employees Social Security and statutory contributions

15.5%, calculated on gross salaries

Corporate Income Tax Rate

26% on taxable profits

Sales Tax

VAT: 23%

Withholding Tax

Dividends 10%;

Interests 15%;

Royalties and other payments 20%.

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