It would seem – what is simpler: you came to a Greek bank, opened an account in your own name and dispose of the money on it at your own discretion. However, there are many nuances that every potential or real owner needs to know, especially a foreigner. They will help to avoid possible problems with tax authorities and penalties. So, in order.
The financial system in Greece is quite transparent and functions in accordance with European and international agreements on the exchange of banking information and combating money laundering. Any foreigner staying in Greece can open a bank account – both tax resident and non-resident. In both cases, there are certain conditions for this, and let’s start with the latter.
All those who come to Greece for a short period and are tied to the tax office in the country of permanent residence are called non-residents. Such persons include, for example: tourists, foreign students of Greek universities, holders of the Golden Visa, financially independent persons. That is, this category of citizens does not receive income in Greece and is not obliged to regularly report to the tax office. True, in the case of real estate purchase, you still cannot do without a one-time declaration of purchase data.
If a non-resident wants to open an account, he needs to submit a document to the bank about his income at home, but some restrictions that exist for residents of Greece do not apply to him. At least most of them. So, you’ve opened a bank account. How can you use it correctly so that any unpleasant situations do not arise?
Firstly, if a bank account is regularly replenished with amounts transferred by a large number of people, this may cause legitimate suspicions that a non-resident is conducting illegal commercial activities. Be ready to respond to the bank’s request and confirm your connection with the sender of the money. If this is, for example, a relative, or the income is related to your official activity in your country, which can be confirmed by the relevant documents, then there will be no problems. By the way, do not ignore the bank’s requests for data on income, place of work and residence, registration with the tax service. The bank may require updated documents every year or even more often, at its discretion.
Separately, it is worth considering the issue of “cash”, that is, one that appears “from nowhere”. If the money got to Greece through the appropriate customs declaration or by bank transfer, then you should not worry – you can spend any amount you want in a hospitable country. But if the purpose of the trip was to buy real estate or a car, and you want to pay in cash, then you will have to explain – where did such a large amount come from. You can not? No documents? Then get ready to be accused of money laundering or receiving it in an illegal, including criminal, way.
In this case, there will be “showdowns” with tax and an impressive fine – about 30% of the amount spent on the purchase of real estate. And keep in mind that it will not be possible to “negotiate” with the seller – all of them, like the notaries who draw up the transaction, report to the state services, and the purchase is registered by the Service for Countering Illegal Activities. Such expensive purchases include not only houses and cars, but also yachts, jewelry, and land.
Tax residents are foreigners who permanently reside in Greece, receive income here and regularly report for it to the tax authorities at their place of residence. But even in this case, it is not always possible to open an account, and sometimes an already opened one is simply blocked. There are several reasons.
When opening an account, the bank will ask for a tax return. This can be avoided only if a student, for example, or the wife of a Greek who regularly pays taxes applies to the bank. However, after a year, the tax return will still have to be submitted.
Tax services are aware of all account movements, receiving this information automatically and being able to analyze it. They will definitely pay attention not only to the receipt of money, but also to the way it is spent. That is, if you prefer to pay in cash and ignore the use of the card, you will have to pay a fine of 22% of the income received minus the amount paid by the card. This will happen if less than 30% of the income spent is paid by electronic means.
What can cause problems with an already opened bank account? As already mentioned, due to the failure to provide documents from the tax office at the request of the financial institution. In addition, the account will be blocked if there is a suspicion of conducting illegal commercial activities – this can be easily refuted if there are relevant documents about the source of cash receipts to the account.
As you know, money cannot appear by itself. If there is no income in the declaration, and the account is regularly replenished, the tax authority will certainly be interested in this fact. Keep in mind – the amount may not be astronomical at all, suspicion may arise even with a one-time receipt of more than one and a half thousand euros. Do not worry if, again, you have confirmation that the indicated amount was donated by your grandfather or you sold something at a price corresponding to the amount transferred to the account. Otherwise, the tax service itself will determine the source of income and calculate the taxes due. By the way, even if grandfather really gave a significant amount of money, keep in mind that the gift tax in Greece has not been canceled!