What are the steps you have to follow in order to setup your business in Greece easily and effortlessly?

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Choosing the appropriate legal entity that suits to your business needs and business plan, can be complicated.

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Each legal entity comes with a list of tax obligations. Find out what are your yearly, quarterly and monthly obligations, before it’s too late.

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One of the questions that our customers asked once they approached us is ” what much time will it take and how much money it will cost me?”

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We will take good care of all the necessary procedures and documentations for the incorporation of your company. We can also provide with a tax business seat!

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Welcome to Greek Market! With our Turnkey Company Incorporation Solution, your Greek Company is ready to take off easily and effortlessly!

It’s your time to do business in Greece and We are here to further support you with our Tax-Accounting and Consulting Services!

What type of legal entity should I choose?
Your options!

There are several ways of doing business in Greece even though the most famous one it the Greek limited liability company, called Private Company (IKE)!We can provide you with the necessary information in order to choose the right entity for your business needs.There are pros and cons in every occasion.

We are here to help you choose wisely the entity that suits to your business needs. Concentrate to your business growth and allow us to take good care of your company incorporation and much more!

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Sole proprietors
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Partnerships
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Limited partnerships
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Social companies
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Limited liability companies

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Limited companies

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Branches of foreign companies
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Representative offices

Types of Business Entities in Greece | Basic information & Incorporation Procedures

General Information

  • A form of limited partnership and the capital consists of share parts.
  • Minimum capital requirements is € 1.00.
  • There is an administrator instead of the board of directors.
  • IKE is governed by its articles and memorandum of association and its accounts must be published.
  • Statutory audit requirements as per EU directives.
  • A single partner can control this form of incorporation.
  • Double entry accounting and reporting system.
  • Management’s and Partners’ Liabilities: The legal representatives (administrators) are liable with their personal property for the company’s tax and insurance obligations. In addition they are liable against third parties when the liability is proved that are made by them (administrators).
  • It  is  very  similar  to  EPE  with  the  difference  that  is  not  obliged  to  the  formalities governing the EPE, it is a more flexible to administer form of company and the setup costs are lower than EPE.
  • Needed time for incorporation: 5 working days after the needed documentation is selected

Pros and Cons

A Private Company is subject to the same corporate tax, and in general the same taxation treatment as a SA and also as the Ltd, type of companies.

The main significant differences between PC and  the two types of companies ( SA and LTD)  is the shorter time period required for the incorporation.

The main significant difference between PC and SA is the absence of the minimum required capital for the Private Company

In the contrary the absence of minimum required capital for PC implies more reduced solvency and credit rating than SA .

IKE – Private Company Incorporation Package

Business founders need to submit a certified copy or copies of their IDs or their passport. They also need to request to send notice to the Insurance Organization (EFKA) with regard to the company’s establishment.

  • Establishment of the company through the General Commercial Register
  • Drafting of the statute of the company (Articles of Association)
  • Drawing up of the required documentation and declarations
  • Issuance of the certificate stating the absence of tax and insurance debt, if required
  • Issuance of the TIN number for the company and the founders
  • Check of the name and the distinctive trade name
  • Submitting all the necessary documentation and declarations  in order to register the company in the General Commercial Register
  • Submitting all the necessary documentation in order to register the legal representative in the Social Insurance Registry (if needed)
  • Payment for all the provided fees required for the company establishment (General Commercial Registry, Social Insurance Registry, Chamber’s Subscription Fee etc)

Government Fees: 

The costs associated with the company formation application are as follows:

  • 100,00 euros for the annual subscription to the Companies House (GEMI)
  • 30,00  euros fees for publications (3 publications, 10 euros each)

(Different fees may apply for different Chambers)

• First year subscription fee with the Athens Chamber of Commerce: €100 (Different fees may apply for different Chambers)

Atlas Consulting Fees depends on:

  • the location
  • the business activity
  • the complexity of the business activity and company formation
EPE – Ltd
  • A limited partnership with the capital consisting of share parts.
  • After the introduction of P.C. in Greek legislation, this company type is not preferred, because it has the same characteristics with P.C. but it requires particular conditions of publication when an ltd is established, as well as during its activity.
  • The procedure is completed in the respective service “General Electronic Commercial Registry” (in Greek: Γ.Ε.ΜΗ. – Γενικό Εμπορικό Μητρώο).
  • Minimum capital requirements is € 1.
  • There is an administrator instead of the board of directors.
  • EPE is governed by its articles and memorandum of association and its accounts must be published.
  • Statutory audit requirements as per EU directives.
  • A  single  partner  can  control  this  form  of  incorporation.
  • Double entry accounting and reporting system
  • Members  (partners)  have limited liability.
  • The Administrator(s) (legal representatives) is liable with their personal property for the company’s tax and insurance obligations.
  • Needed time of Incorporation: 2 weeks

 

Pros and Cons: 

Generally speaking A Limited Liability Company has the same characteristics as a Private Company and is treated by the tax legislation the same way.

However, nowadays, the Private Company is mostly preferred due to its smooth way of incorporation and less publication needs

Societe Anonyme (SA)
  • A limited liability company with either bearer or registered shares
  • One or more natural or legal persons.
  • The S.A. is managed by the Board of Directors consisting of at least three members.
  • A notarial deed is required for the establishment.
  • The procedure is completed in the respective service “General Electronic Commercial Registry” (in Greek: Γ.Ε.ΜΗ. – Γενικό Εμπορικό Μητρώο).
  • Minimum  capital  requirements  of  € 24,000.
  • The  accounts  must  be  published  and  filed  with  the  Ministry  of  Commerce.
  • Statutory  audit  requirements  as  per  EU  directives.  (Any  two  of  the  following three  factors:  Turnover  over  €  8.00  m,  total  assets  over  €4.00m  and  over  50 people staff).
  • A one person S.A> company can be formed.
  • Double entry accounting and reporting system.
  • Needed Time of incorporation: a few weeks

Pros and Cons

The S.A. (Societe Anonyme) is usually preferred by enterprises that have provision for high turnover and also that aspire to get in the Stock Exchange .

There is a need for at least  24 000 euros capital (from 01-01-2019 at least 25.000 euros).

It is obligatory to keep double-entry books, which implies significant costs in terms of accounting.

This corporate type are considered more trustworthy by the banks due the existence of the capital.

  • There are 2 types of partnership: General partnership and limited partnership.
  • The establishment of a general partnership requires the cooperatiom of at least two parties that are mutually obliged in pursuing a common commercial purpose.
  • The agreement between the parties ( the partners) must be filed by General Electronic Commercial Registry” (in Greek: Γ.Ε.ΜΗ. – Γενικό Εμπορικό Μητρώο).
  • For the formation of a general partnership it is not required a notarial deed; only a private agreement is only needed.
  • The partners can be either equally liable as per their capital contribution (OE) or one partner can have unlimited liability and the rest of the partners no liability (EE).
  • In addition, a specific minimum amount of share capital is not required
  • Simple entry accounting and reporting system
  • Needed Time for incorporation: 1 week

 

Pros and Cons: 

General Partnerships are usually chosen by small and medium-sized enterprises, where personal involvements prevail the capital factor.The main Advantages are: 1. no minimum capital required 2.single-entry book keeping that reduces the administrative costs (tax-accounting costs).

The main disadvantage of such companies is establishing a personal, jointly and severally, liability in all General Partnerships for the debts of the company to third parties (certainly including the government and public entities). Only Greek and European Nationals, as well as Third Country Nationals holding the required residence permit may participate as equal partners in this corporate form.

 

 

  • Not a separate legal entity but an extension of the overseas parent company
  • No limited liability or ring-fencing of the Greek operations
  • If have a permanent establishment in Greece then profits from this PE are liable to Greek Corporation tax
  • Must  file parent  company  accounts and  those  for  the  branch  at  the  Ministry  of Commerce.
  • Needed Time of Incorporation: one week

Now a Company Formation is easier than ever: set up a Greek Private Limited Company (IKE) !

Atlas Consulting Tax Experts can help you to enter into the Greek Market and start your business without hassle!

There are several ways of doing business in Greece, the most common being through the setup of a Greek limited liability company, called Private Company (IKE)!

In order to set up a Greek Private Company, there are a list of  bureaucratic and legal steps that a foreign entrepreneur  must complete.

If you want to  incorporate and register a Private Company (IKE) in Greece, you can find the basic steps on the following Article , along with a detailed summary of those procedures, and the estimated time and cost for each step.

Frequently Asked Questions about Private Companies - IKE

Companies resident in Greece are subject to corporate income tax on their worldwide income from all sources. Non-resident companies that have a permanent establishment in Greece are subject to corporate income tax on income derived through the permanent establishment. Companies are deemed to be resident if they are incorporated in Greece (the registered office is in Greece) or have their place of effective management in Greece. The fiscal year usually runs from 1 January to 31 December.

However, all companies maintaining a double- entry accounting system can choose to have the fiscal year ending on 30 June. Also, if a Greek company is a subsidiary of a foreign parent company with the parent company holding a minimum of 50% of the share capital, the Greek company can choose to align the fiscal year with that of the foreign parent company.

The tax rate applicable to undistributed profits is 29% for all forms of companies including Public Limited Companies (SA), Limited Liability companies (EPE) and branches of foreign companies.

Distributed profits are subject to an additional income tax of 15%. Dividends paid to parent companies based in European countries are exempted from such dividend tax if certain conditions are met.

The calculation of tax on the taxable profits of branch offices of international companies is the same as the tax applicable to Greek companies in general. The tax is calculated at 29% of net taxable income. There is no branch remittance tax in Greece.

VAT is imposed on the sale of goods and supply of services at a standard rate of 24% which applies to the majority of goods and services. For specific categories of goods and services a reduced rate of 13% and an extra reduced rate of 6% applies. The above rates are reduced by 30% for sales to a few specific remote Aegean islands but this reduction is expected to be abolished in the near future

Current Corporate Tax rates in Greece are:

Type of Business                                           Tax Rate

Societe Anonyme SA; EPE; IKE, branches       29%

Other corporations OE, EE                                  29%

The Divident Tax is 15% on the dividents’ amount.

Yes, a Private Company must pay every year a Lump Sum Tax ( Telos Epitidevmatos) of 1000 euros.

For the first year only, the company will pay a percentage of the lump sum tax depending on the date you establish the company.

The tax is calculated on the net profit of the company. The corporate tax rate on the net profit are 29%. Every year you have to pre calculate and pay a tax advance of 50% for the first 3 years and then 100% for the years onwards.

The equation for the calculation of the tax is the following:

regular tax 29% on the net profits

(+) 50% ( for first years) advance payment of the next year’s tax

(- ) the advance payment of previous year tax

The tax payment starts on the end of July once the Corporate Tax Returns is submitted ; then the company can either pay all the tax at once or in 6 monthly instalments from July and the months after.

There is no tax withholding if a double treaty provides so and also if tax relief is available under the EU Parent – Subsidiary Directive (90/435/EEC – EU holding company has more than 10% participation in the Greek subsidiary for at least two consecutive years). Dividends received by Greek parent companies from subsidiaries established in other EU member states (has more than 10% participation in the EU subsidiary

for at least two consecutive years) are exempt from tax at the shareholder level to the extent that they are registered under a tax free reserve account. If these dividends are subsequently distributed or capitalized a 15% tax is applicable.

Greece follows internationally recognised Transfer Pricing (TP) rules where cross-border trading and financial transactions between affiliated entities have to be conducted on an arm’s length basis. The price and terms should be the same as if the transactions had been between completely independent parties.

The arms length principle applies to all transactions made between a Greek company / branch and its foreign affiliates. It is wise to be ready at all times to satisfy the tax authorities on pricing policies involving both ways of trading. For management fees and royalties above the rates accepted by the tax authorities special approval by the Ministry of Finance is required. Companies with inter group transactions, over and above the limits of the transactions as specified by the ministry of finance, are required to file a return for all intergroup transactions and also the method used to account for these transactions. They are also obliged to have a documentary file proving the method used.

f an individual is resident in Greece then they are subject to Greek tax laws. An individual is resident in Greece if they reside in Greece or has a habitual abode in the country. An abode will be regarded as ‘habitual’ if the taxpayer stays in Greece more than 183 days within a calendar year.

We would advise any new entrant to Greece or person who spends time working in Greece to take professional advice to determine whether they are Greece tax resident.

Current Personal Income Tax rates in Greece are:

Band of income (Euro) Tax rate (%)

0-20,000                           22%

20,001-30,000                 29%

30,001-40,000                 37%

40,001-                              45%

(NB: rates are for the tax year 2017)

Employers and employees also have to pay Greek social security, which is called National Insurance rates are currently about 25% for the employer and 16% for the employee on their gross salary.

It is the employers’ legal responsibility to pay over employee’s tax and social security deductions to the Greek tax authorities.

For other EU nationals exceptions may be given for a limited period of time provided they can prove they are registered at home.

Yes, it is compulsory that the Director of a Private Company must be insured. He can either be an employee of the company or can be a person that offers his services without employment strings; however he must pay at least 167,5 euros per month to the National Insurance Organisation.

Since the Business registration of the new company, a wide range of tax- accounting obligations runs in certain time periods. -We provide several packages of Tax- Accounting Compliance depending on the needs of each company.

Accounting- Bookkeeping

Recording of other transactions  in accordance with Greek statutory regulations, on the basis of documentation & information provided by the Company

Preparation of the monthly trial balance

Preparation of the general ledgers printouts

Monthly cash, credit cards and bank reconciliation

Insurance Policies amortization

Preparing depreciation/amortization tables both for accounting as well as for tax purposes

Preparing obligatory reports for the Central Statistical Office, National Bank and other

• Be readily available to answer questions from the staff and Accounting Unit as needed

• Other accounting/bookkeeping duties as needed

Year-end closing of the Company’s accounting books

Preparation of the closing journal entries, recording of any year-end provisions & accruals, reconciliation of year-end accounts to general ledger & supporting data

Preparation & sign off (as accountants) of the financial statements & related notes

Tax Filings

Tax Filings for withholding taxes; Value Added Tax Filing (due monthly) Corporation Tax Filing (due annually); Accounts Filing (due Annually)

Ongoing tax compliance services

Preparation, sign off & submission of the Company’s annual income tax return

Preparation, sign off & submission of monthly & annual VAT, Intrastat & EC Sales Listing returns

Preparation, sign off & submission of the Company’s annual suppliers/client listings

Preparation, sign off & submission of the free lancers & third parties’ fees withholding tax returns monthly & annually

Preparation & filing with the tax authorities of the monthly various withholding tax returns

Preparation & filing with the tax authorities of the quarterly statement of contracts

Reporting

Annual Financial Statements – Publications To General Commercial Registry Specialised Reporting for shareholders, for investors, for banks etc

Monthly calculation of the gross and net salaries payable to the employees, on the basis of figures provided by the Company;

– Calculation of the amounts due for personal income tax, social and health security contributions;

– Preparation and submission of all the required data to the Social Security authorities & filing of notifications to the competent authorities regarding the contributions payable as required;

– File keeping of all documentation, related to the provision of payroll services;

– Administration of ERGANI reporting (hiring, termination of employment, amendment working hours, overtime, amendment of salary, annual leave);

– Preparation of employees’ monthly and annually pay slips in official format;

– Computation of employees’ indemnity upon dismissal;

– Monitoring of vacation days entitlement of the employees as well as the remaining untaken days per year, according to the figures provided by the company. It has to be noted though that this service is not and does not replace the update of the book leave of the company which remains under your responsibility;

– Preparation of the payroll monthly withholding tax returns.

Preparation of monthly, quarterly, and annual reports

• Preparation of schedules requested by the auditors as well as any other audit process support requested

• Preparation of year-end balance sheet, revenue and expenditure and funds flow reports for auditor

• Provide audit process support; research and resolve issues as they arise

• Meet with auditor as needed

• Assistance in budget preparation and analysis           

Here are the services that we provide!

There are several ways of doing business in Greece even though the most famous one it the Greek limited liability company, called Private Company (IKE)!We can provide you with the necessary information in order to choose the right entity for your business needs.There are pros and cons in every occasion.

We are here to help you choose wisely the entity that suits to your business needs. Concentrate to your business growth and allow us to take good care of your company incorporation and much more!

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