Automatic fines will be imposed immediately for late income tax returns, VAT and withholding tax declarations, with the new automatic penalty system being activated by the Greek Tax Authority by the end of the year. The tax administration’s plan provides that fines will be automatically certified through Taxis, with the penalty notice being immediately communicated to taxpayers.
In practice, with the finalization and submission of each overdue declaration, the relevant standalone fine will be imposed simultaneously. If the declaration also results in tax payable, the system will automatically certify both the tax and the penalty.
Currently, penalties reach taxpayers and professionals with significant delays, as they are often imposed months after submitting the overdue declaration. With the new system, however, monetary sanctions will automatically “fall” for all basic declarations: income, VAT, recapitulation tables, reclassification declarations and withholding taxes.
What are the penalties for late income tax and VAT returns
The standalone penalties for overdue tax returns are as follows:
· €100 for employees and pensioners,
· €250 for those conducting business activities and keeping single-entry books,
· €500 for those keeping double-entry books.
Specifically:
1. Late submission of initial income tax return
€100 penalty for employees and pensioners.
For entrepreneurs:
· €250 if they keep single-entry books,
· €500 if they keep double-entry books.
2. Late submission of amended income tax return:
a) If the initial timely return had resulted in a tax credit balance for refund and the late amended return shows a tax amount payable:
Taxpayers who are not entrepreneurs or freelancers: €100 penalty.
Entrepreneurs or freelancers:
· €250 if they keep single-entry books,
· €500 if they keep double-entry books.
Additionally, if the tax payment deadline has passed, late payment interest is also imposed, at a rate of 0.73% for each month of delay, calculated on the difference between the timely initial and the late amended declaration.
b) If the initial timely return had resulted in a tax amount payable and the late amended return results in an increase of the payable balance:
Taxpayers who are not entrepreneurs or freelancers: €100 penalty.
Entrepreneurs or freelancers:
· €250 if they keep single-entry books,
· €500 if they keep double-entry books.
3. VAT and withholding taxes
In every case of late submission, whether initial or amended declaration, the following penalties apply:
· €250 for entrepreneurs and freelancers keeping single-entry books,
· €500 for those keeping double-entry books.
