The Greek tax police will conduct checks on people who purchased real estate with cash, identifying cases of black money laundering, tax evasion and virtual transfers of real estate.
The Greek Real Estate Agency has more than 40,000 cases of transfer of real estatethat occurred after March 2021, the launch date of the myProperty online platform, and payment of the cost was made entirely in cash.
The audits will start with high-value contracts, with auditors scrutinizing taxpayers’ tax returns, recording the total income they reported to tax authorities from wages, business activities, rent, sales of real estate and other assets, cash payments to parents, donations and inheritances.
Not only buyers but also sellers of real estate are subject to detection of cases of fictitious transfer of property, and if the IRS suspects that funds allocated for the purchase of real estate are obtained from undeclared income or illegal activities, it will begin to open bank accounts.
If audits reveal that the price paid for the property is not justified by the income declared, such taxpayers will be asked to explain the origin of the money. Those who cannot explain the origin of the money will have to pay an additional tax at a rate of 33% on the “uncovered” amount, since it is considered an unreasonable addition to property. These cases will also be sent for further review to the Anti-Money Laundering Office.
One in eight property transfer tax returns showed payment in cash. There have been 338,511 transfer tax returns filed since March 2021, according to the AADE. In 42,613 real estate transfer tax returns, the price was paid exclusively in cash and amounted to a total of EUR 462,493,710.3. There were also 41,741 declarations of transfer of real estate in which the price was paid partly in cash, for a total amount of 2.98 billion euros (the amount indicated is the total for these declarations, since the amount paid in cash is not taken into account separately). Random audits of tax returns will also be conducted on purchases and sales that were partially made in cash.
In order to limit “dummy” transactions and laundering of “black money” in the transfer of real estate, the Ministry of Economy and Finance will submit a legislative act to parliament, providing for a ban on cash payments in all real estate transactions from January 1, 2024.