The CSD provides tax support services in the following areas:
- Taxation on securities sale transactions
- Taxation on OTC lending and borrowing (SLB) transactions
- Taxation on cash distributions
- Taxation on capital gains from the transfer of dematerialized securities
Sales of shares on the ATHEX market are subject to a tax at 0.2% (Ministry of Finance Decision POL.1056/28.3.2011). Operators pay to the CSD the tax which the CSD then pays to the Greek government.
Sales of foreign shares are also subject to a tax at 0.2% (Decision POL.1056/28.3.2011) calculated on the value of the transaction. However, the investor is liable for declaring and paying the tax.
OTC transfers are taxed at the same tax rate and in the same context (Law 3697/2008).
The tax on OTC transfers is calculated as follows:
- For OTC cash transfers, which are performed in the CSD in accordance with Article 46 of the DSS Regulation, the tax is calculated based on the larger value between the one referred to the private agreement and the closing price of the day before the filing of the documents. For transfers due to Donation, Parental Benefit or Succession, the tax obligation is exhausted by declaration of the tax payer to the relevant Tax Office.
- For FoP OTC transfers executed by General Operators the tax is calculated based on the closing price on the date of the transaction and for DvP it is calculated based on the settlement amount.
OTC lending and borrowing (SLB) is taxed in accordance with Law 4038/2012 at a rate of 0.2% and is borne by the lender. The CSD detains and pays to the Greek government the withholding tax.
The CSD shall withhold and pay to the Greek government the tax corresponding to the distribution of cash (e.g. dividends) and/or in kind (e.g. reinvestments).
For foreign securities, the CSD withholds the Greek tax from the net amount received from the Provider after the Provider has withheld the foreign tax.
Under the current tax regime, the following tax rates shall apply by type of cash distribution:
1. Tax rates for cash distributions from 1/1/2014 - under Law 4172/2013.
|Type of cash distribution||Tax rate (%) on corporate Profit (Financial Year 2013 - 2014 Distribution)||Tax rate (%) on Distributed Profit (Financial Year 2013 - 2014 Distribution)||Relevant provisions|
|Cash Dividend||26||10||Law 4172/2013, Articles 58 & 64|
|Dividend in kind||26||10||Law 4172/2013, Articles 58 & 64|
|Reinvestment of Dividend / Ex-Dividend||26||10||Law 4172/2013, Articles 58 & 64|
|Cash Ex-Dividend||26||10||Law 4172/2013, Articles 58 & 64|
|Ex- Dividend in kind||26||10||Law 4172/2013, Articles 58 & 64|
|In respect of dividends from foreign securities only Greek residents (natural persons) shall be taxed||10||Law 4172/2013, Articles 9 & 40 by offsetting the foreign tax up to level of the domestic tax|
|In respect of dividends from foreign securities only Greek residents (legal persons) shall be taxed||10||Under the general provisions of Law 4172/2013, article 36|
2. Tax rates for cash distributions until 31/12/2013 - until the entry into force of Law 4172/2013.
|Type of cash distribution||Tax rate (%) on corporate Profit (Financial Year 2012 - 2013 Distribution)||Tax rate (%) on Distributed Profit (Financial Year 2012 - 2013 Distribution)||Relevant provisions|
|Cash Dividend||20||25||Law 3943/2011, Article 14 (1)|
|Dividend in kind||20||25||Law 3943/2011, Article 14 (1)|
|Reinvestment of Dividend / Ex-Dividend||20||25||Law 3943/2011, Article 14 (1)|
|Cash Ex-Dividend||20||25||Law 3943/2011, Article 14 (1)|
|Ex- Dividend in kind||20||25||Law 3943/2011, Article 14 (1)|
|Capital repayment by reinvestment||0||0|
|Distribution of special reserves||0||Floating||Depending on the type of reserve distributed|
|Interest on privilege||0||35|
|Coupon payment||0||15||Law 4110/2013, Article 2 (4)|
|Distribution of Free Shares||0||0|
|In respect of dividends from foreign securities only Greek residents (natural persons) shall be taxed||0||10||Law 2238/1994, Article 54 (3)|
|In respect of dividends from foreign securities only Greek residents (legal persons) shall be taxed||0||20||Law 2238/1994, Article 54 (4)|
|Special cases of taxation|
|ELPIS||0||25||Legal Framework - Law 2396/1996 (Article 59) - Treats ELPIS like shares - Law 3943/2011 (Article 14 (1))|
|Residents of countries with DTC||Floating||As applicable|
|Foreign parent companies (EU)||0||As applicable|
|Venture Capital Funds||0||For all Dividends - Explanatory letter from the Minister of Finance 1022929/10278/80012-20/03/2009|
|Qualified Organizations||0||Explanatory letter from the Minister of Finance 1110588/3668/DOS - 07/12/2009|
|(REICs) Real Estate Investment Companies||0||All Shareholders - POL.1180/31.12.2008 (Article 20 (3)), Law 2778/1999 (Article 31 (3))|
|(CICs) Closed Investment Companies||0||All Shareholders - POL.1180/31.12.2008 (Article 20 (3)), Law 3371/2005 (Article 39 (3))|
|Vessel Operating Companies||0||All Shareholders - POL.1180/31.12.2008 (Article 18 (1)), Law 75/1975 (Article 2)|
|Mutual Funds for foreign dividends||0||Law 3522/2006, Article 15 - Explanatory letter from the MoF (D12B 1097877EX2012)|
Ministry of Finance Decisions POL.1129/2011 & 1054/2012 clarified that, the person liable to furnish a certificate to Investors for tax purposes in respect of the corporate actions of the Dividend, Ex-Dividend and the Distribution of special reserves shall be the Operator of the investor Securities Account and not the issuer.
In the beginning of each year, investors who receive favorable tax treatment must inform and produce the necessary supporting documents to the Operator of their Securities Account so that the Operator enters the appropriate indication in the DSS.
On 23 July 2013, Law 4172/2013 was published in the Government Gazette replacing the Greek Income Tax Code.
The new provisions relate to individual and corporate taxation and they are in principle applicable for income generated and expenses incurred for tax years starting as of 1st January 2014. They also include a new implementation framework for the Capital Gains Tax (CGT) on securities and a postponement of CGT implementation on shares to 1st January 2014. The current shares sales tax (20 bps on the transaction value) will continue to apply from 1st January 2014 onwards, in addition to CGT.
In relation to the Capital Gains Tax (CGT) on securities the following are to be noted:
- Capital gains deriving from transfer of capital are taxed at the rate of 15% for individuals only and refer to capital gains from the transfer of securities provided that such transfers are not classified as business activities.
- The new provisions apply to capital gains from transfers of securities taking place from 1st January 2014 onwards. The 20% taxation of capital gains from transfer of shares listed on the Athens Stock Exchange and acquired from 1st July 2013 onwards is abolished.
- The exemption of capital gains arising from the exchange of Greek Government Bonds or corporate bonds guaranteed by the Greek State with other securities in the context of PSI remains in force.
- Capital gains deriving from the transfer of securities include shares in listed or non-listed companies, Greek Government and corporate bonds, Greek Treasury Bills and derivatives of financial instruments which are listed indicatively.
- Capital gain has the meaning of the difference between the acquisition price paid and the transfer price received, including any expenses directly connected with the acquisition and sale of securities which are not added or deducted, respectively.
- For listed shares, their acquisition and transfer price derive from documentation issued by the intermediary broker or bank or documentation notified to Hellenic Exchanges
- For non-listed shares, the transfer price is the higher price between the contractual price and the net equity (upon transfer) of the company that issues the shares. The purchase price is the lower price between the contractual price and the net equity (upon transfer) of the company that issues the shares.
- In case that the acquisition price cannot be calculated, it is considered as nil.
- Loss deriving from the transfer of securities can be carried forward indefinitely (for individuals only), whereas such loss can only be set off against profits deriving from transfer of securities, respectively.
- The above categories of income are included in income from business activity of legal persons and legal entities and are taxed according to the relevant rates.
- In any case, the provisions of the various Double Taxation Treaties ("DTTs") override the provisions of domestic law, which is applicable in absence of any DTTs
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