Greece is not the most popular country for foreign company incorporation, however, there has been massive investment in infrastructure projects, largely financed by the EU. In the light of the opportunities that Greek financial crisis offers, it is important for any potential investors to understand the vehicles through which they can materialize their business plans. In other words, it is necessary to understand the main characteristics of the Greek companies and their formation procedure.
Greek EPE (Limited Liability Company):
- minimum share capital is €18.000, at least half of this must be paid up in cash at formation
- at least one shareholder
- at least one director of any nationality
- Statutory financial reporting is required
- liability of the shareholders is limited to the amount of their contribution
In certain cases, only one individual is enough to form a Greek EPE with a minimum share capital of 5000 EUR, and using the termination “one person limited liability company" at the end of the entity name.
Greek AE (Limited By Shares Company):
- minimum share capital is €60.000
- at least two shareholders, which can be natural persons or entities
- at least one director of any nationality
- board of directors and auditors is required
A Greek general partnership is established by at least two members, with no requirements for a minimum share capital and based on an agreement signed by these partners. The members of a Greek general partnership are fully liable for the entity’s debts and can claim profits in an equal matter.
Taxation:
- Corporate tax is 29% and is imposed on a company’s total annual profits before the distribution of dividends, fees paid to directors, etc. Normal business expenses are deemed deductible for tax purposes
- Dividends received from (domestic or EU-resident) subsidiaries qualifying for the participation exemption (i.e. where a 10% minimum participation is held for an uninterrupted period of at least 24 months, etc.) are exempt from corporate tax
- VAT rate is 24%, the reduced rate is 13% and the super-reduced rate is 6%. Specific supplies are exempt with or without the right to deduct input VAT
- Capital gains derived by corporations are taxed as business profits at the 29% corporate income tax rate
- Tax losses may be carried forward for five consecutive tax years, to be set off against the taxable profits of those five tax years
- Royalties paid to nonresident entities are subject to a 20% (final) withholding tax, subject to tax treaty relief
- Special tax regimes apply to shipping companies, coordination centers, real estate investment companies and mutual funds