The Greek Independent Authority for Public Revenue (AADE) is clarifying the tax rules governing money transfers made through IRIS, specifically addressing when such transactions become taxable — an issue that has come to the fore recently, largely due to mistakes made by users.
Read also: IRIS: When pocket money becomes a “wealth increase” — AADE targets money transfers between relatives and friends
AADE has made clear that everyday small-amount transfers raise no tax concerns when they cover routine family expenses — for example, parents sending money to students for rent, tuition, groceries, and similar daily needs. In these cases, there is no monetary cap, other than the basic rule that no single transaction may exceed €1,000 per day.
What AADE clarifies about IRIS money transfers
Tax issues may arise when users make errors — for instance, entering a description such as “gift” or “loan” when the transfer is neither. In such cases, there is a theoretical risk of triggering standalone taxation, which can reach as high as 40%. It is worth noting that for parental grants or gifts between first-category relatives, the tax-free threshold is €800,000, provided the transfer is made through the banking system.
The situation is entirely different for self-employed professionals. Accepting payments via IRIS is mandatory for them, and any funds received are treated as business income and taxed accordingly.
According to AADE’s clarifications:
- Small transfers between relatives and close acquaintances — whether made via IRIS or any other banking transaction — are not, in and of themselves, subject to particular tax scrutiny, unless a specific pattern of abusive practice is identified (e.g., consistent frequency, same — especially large — amounts).
- Money given by parents and grandparents to children and grandchildren for everyday minor expenses — that is, pocket money — is not treated as a monetary gift requiring a declaration through the myPROPERTY platform.
Pocket money vs. gifts
AADE emphasizes, however, that monetary parental grants or gifts are an entirely separate matter from pocket money. Taxpayers who give money to relatives — or even friends — should be aware of the following:
- Monetary gifts of up to €800,000 to first-category individuals — namely children, spouses, parents, and grandchildren — are tax-exempt, provided they are made through the banking system and the relevant declaration is submitted. Amounts exceeding €800,000 are subject to a 10% tax rate.
- Declarations of monetary parental grants are submitted through the myPROPERTY platform, after which AADE cross-checks the transaction against data provided by credit institutions. If the bank does not confirm the transaction and the taxpayer fails to provide the necessary supporting documents, the tax authority proceeds to impose tax without applying the tax-free threshold. This means tax is levied from the first euro of the parental grant or gift, at a rate of 10%, 20%, or 40%, depending on the degree of kinship.
- Monetary parental grants made in cash — that is, funds not transferred through the banking system — are taxed independently at a flat rate of 10%, with no tax-free threshold.
- In cases of successive gifts where the ultimate beneficiary is not entitled to the €800,000 tax-free threshold (for example, a gift from a child to a parent, followed by a gift from that parent to another child), AADE investigates the actual circumstances, the intent behind the transactions, and the time elapsed between them. If it is established that the final beneficiary is a person outside the first category (e.g., a sibling) and that the successive gifts were structured with this purpose in mind, a 20% tax is imposed with no tax-free threshold. If the time between successive gifts is short — specifically, no more than six months — the case may be flagged as grounds for a tax audit.
- Transfers to a joint account held by the child or recipient together with a third party are also subject to scrutiny. Authorities will investigate whether the funds were used by the child or recipient, rather than by the third party. If it is established that the third party used the funds, a gift tax will be imposed.
- Monetary gifts to siblings, aunts, uncles, and other second- and third-category relatives are taxable from the first euro. Gifts to second-category relatives are taxed at 20%, while gifts to third-category relatives and other individuals are taxed at 40%.
Transaction limits increased
Since last January, IRIS transaction limits have been raised from their original levels. The daily limit for private individuals has doubled from €500 to €1,000 — applicable both to transfers between individuals and to payments to professionals — while the monthly cap has been set at €5,000.
Transfers between private individuals are commission-free. Outside of person-to-person transfers, fees apply exclusively to the recipient of the funds — that is, the professional, merchant, or business. The cost varies depending on the business category and the payment channel used (via the professional’s mobile number or tax identification number). Commission rates range from 0.2% to 0.5% of the transaction amount and are, in all cases, lower than the fees charged on credit and debit card transactions.
