Greece amends tax penalties and interest on overdue payments

March 2018

  • Share

Recently, Greece has made several amendments to its tax penalty and interest regime with respect to overdue payments. This Alert summarizes the framework for the imposition of tax penalties and interest on overdue payments for the filing of late or inaccurate tax returns as well as for the failure to file a tax return. The framework has been established by the enactment of Laws 4509/22.12.2017 and 4512/17.01.2018 as amended by Law 4520/22.02.2018 and are now in force.

I. Tax years, periods, cases or tax obligations in general up to 31 December 2013

I.1. Filing of late tax returns

Penalties for procedural violations of article (art.) 54 of the Greek Tax Procedure’s Code (L. 4174/2013 – GTPC) plus late payment interest as provided in art. 53 GTPC are applicable, instead of the surcharge of art. 1 of L. 2523/1997, under the condition that the former are more favorable to the taxpayer, as follows:

EY - Late filing penalties

  • Based on the provisions previously applicable (as of 17 January 2018), the filing of a late tax return following the issuance of the tax audit order was not allowed.
  • As of 1 January 2018, the more favorable penalty regime is applied.
  • The penalty of art. 54 of L. 4174/2013 is subject to stamp duty (at the rate of 2.4%) upon its payment.

EY - Late filing penalties

  • Based on the provisions previously applicable (as of 17 January 2018), the filing of a late tax return following the issuance of the tax audit order was not allowed.
  • As of 1 January 2018, the more favorable penalty regime is applied.
  • Tax returns filed after the notification of the tax audit order to the taxpayer cannot be submitted with reservation.
  • The penalty and late payment interest imposed on late tax returns submitted as of 17 January 2018 are reduced to 60%,provided that the tax debt is paid within 30 days from the assessment
  • The 60% reduction is not applicable to salary withholding tax returns.

I.2. Filing of inaccurate tax returns and non-filing of tax returns

The penalties of arts. 58, 58A par. 2 or 59 of the GTPC plus late payment interest as provided in art. 53 GTPC are applicable, instead of the surcharge of art. 1 of L. 2523/1997, under the condition that the former are more favorable to the taxpayer, as follows:

EY - Late filing penalties

EY - Late filing penalties

I.3. Pending cases as of 1 January 2018

  • The more favorable penalty regime is also applicable for pending cases as of 1 January 2018. Pending cases include all cases pending before the Dispute Resolution Directorate, the Administrative Courts and the Supreme Administrative Court (Council of State), following the filing of an administrative or judicial appeal or the cases for which the deadline for the aforementioned filing has not elapsed yet, as well as the cases for which the respective assessments or decisions have been issued but have not been yet notified to the taxpayer and the cases for which a hearing before the Court has taken place but the latter has not yet delivered an irrevocable decision or a non-irrevocable decision has been delivered but has not been yet notified to the taxpayer by 1January 2018. These provisions are also applicable in cases that the taxpayer does not elect to continue legally pursuing the case, provided that the taxpayer shall proceed with the submission before the Head of the competent Authority which issued the relevant note or decision of an irrevocable declaration of unconditional acceptance of the corrective tax assessment note or the decision of the Dispute Resolution Authority or the Court.
  • Surcharges paid after 1 January 2018 that were assessed without applying the more favorable regime for the taxpayer are refundable or offsetable (Circular POL. 1019/2.2.2018). In contrast, surcharges paid prior to the entry into force of the more favorable provisions, i.e., prior to 1 January 2018, shall not be refundable or offsetable (L. 4520/2018).
    It appears that the non-refundability of amounts paid prior to 1 January 2018 also applies to cases that were pending on this date, given that the crucial element is the time that the payment was made rather than the (pending) status of the case. Questions arise on the manner that certain pending cases will be dealt with, for which the tax debt was only partially paid before 1 January 2018, as well as on the manner that certain non-pending cases for which an installment payment scheme is applicable within 1 January 2018 will be dealt with.

I.4. Pending cases as of 17 January 2018

  • For pending cases as of 17 January 2018, the penalty and late payment interest imposed can be reduced to 60%, provided that the tax debt is paid within 30 days from the notification of the corrective tax assessment note to the taxpayer and the taxpayer submits an irrevocable declaration of unconditional acceptance of the corrective tax assessment note. Pending cases are the cases pending before the Dispute Resolution Directorate, the Administrative Courts and the Supreme Administrative Court (Council of State), following the filing of an administrative or judicial appeal or the cases for which the deadline for the aforementioned filing has not elapsed yet, as well as the cases for which a hearing before the Court has taken place but the latter has not yet delivered an irrevocable decision or a non-irrevocable decision has been delivered but has not been yet notified to the taxpayer by 17 January 2018.
  • The reduction of penalty plus interest to 60% is also applicable if:
    − A corrective tax assessment note has been issued but has not been notified to the taxpayer up to and including 17January 2018, or
    − A corrective tax assessment note will be issued following the notification of the provisional tax assessment note conducted up to 17 January 2018. The reduction is applicable provided that the taxpayer accepts the corrective tax assessment by virtue of a final and irrevocable declaration and the tax debt is paid within 30 days from the notification of the corrective tax assessment note to the taxpayer.
  • Surcharges/penalties paid after 17 January 2018 that were assessed without applying the reduction of penalties to 60% are refundable or offsetable (Circular POL. 1019/2.2.2018). In contrast, surcharges/ penalties already paid before being eligible to reduction, i.e., prior to 17 January 2018, shall not be refundable or offsetable (L. 4520/2018).
    It appears that the non-refundability of amounts paid prior to 17 January 2018 also applies to cases that were pending on this date, given that the crucial element is the time that the payment was made rather than the (pending) status of the case. Questions arise on the manner that certain pending cases will be dealt with, for which the tax debt was only partially paid before 17January 2018.

Despite the fact that L. 4174/2013 has undergone several amendments, the exact time of entry into force of its provisions regarding the imposition of penalties and late payment interest remains unclear. In more detail, it is still not clear whether the tax year, period and tax obligation are the crucial points in time for the determination of the applicability of penalties and interest of L. 4174/2013 or whether this crucial time corresponds to the time that the tax violation has been committed.

II. Tax years, periods, cases or tax obligations in general from 01 January 2014 onwards

II.1. Filing of late original or amending tax returns

EY - Late filing penalties

  • The penalty of art. 54 of L. 4174/2013 is subject to stamp duty (at the rate of 2.4%) upon its payment.

EY - Late filing penalties

  • Based on the provisions previously applicable (as of 17 January 2018), the filing of a late tax return following the issuance of the tax audit order was not allowed.
  • The penalty imposed on late tax returns filed as of 17 January 2018 is reduced to 60%, provided that the tax debt is paid within 30 days from the assessment. It appears, based on the wording of these provisions, that for tax years, periods, cases or tax obligations in general up to 31 December 2013, the reduction to 60% also includes the late payment interest of art. 53 of GTPC imposed, whereas, for tax years, periods, cases or tax obligations in general as of 1 January 2014, the reduction to 60% only applies to the penalties imposed under arts. 58, 58A and 59 of the GTPC.
  • The 60% reduction is not applicable to salary withholding tax returns.
  • Tax returns filed after the notification of the tax audit order cannot be filed with reservation.

II.2. Filing of inaccurate tax returns and non-filing of tax returns

EY - Late filing penalties

EY - Late filing penalties

II.3. Pending cases as of 17 January 2018

  • For pending cases as of 17 January 2018, the abovementioned penalty imposed can be reduced to 60%, provided that the taxpayer submits an irrevocable declaration of unconditional acceptance of the corrective tax assessment note and the tax debt is paid within 30 days from the notification of the corrective tax assessment note to the taxpayer. Pending cases are the cases pending before the Dispute Resolution Directorate, the Administrative Courts and the Supreme Administrative Court (Council of State), following the filing of an administrative or judicial appeal or the cases for which the deadline for the aforementioned filing has not elapsed yet, as well as the cases for which a hearing before the Court has taken place but the latter have not yet delivered an irrevocable decision or a non-irrevocable decision has been delivered but has not been yet notified to the taxpayer by 17 January 2018.
  • The reduction of penalty to 60% is also applicable if:
    - A corrective tax assessment note has been issued but has not been notified to the taxpayer up to and including 17 January 2018, or
    - A corrective tax assessment note will be issued following the notification of the provisional tax assessment note conducted up to 17 January 2018.
    The reduction is applicable provided that the taxpayer accepts the corrective tax assessment by virtue of a final and irrevocable declaration and the tax debt is paid within 30 days from the notification of the corrective tax assessment note to the taxpayer.
  • Penalties paid after 17 January 2018 that were assessed without applying the reduction of penalties to 60% are refundable or offsetable (Circular POL. 1019/2.2.2018). In contrast, penalties already paid before being eligible to reduction, i.e. prior to 17 January 2018, shall not be refundable or offsetable (L. 4520/2018).
    It appears that the non-refundability of amounts paid prior to 17 January 2018 also applies to cases that were pending on this date, given that the crucial element is the time that the payment was made rather than the (pending) status of the case. Questions arise on the manner that certain pending cases will be dealt with, for which the tax debt was only partially paid before 17 January 2018.
    Also, it appears, based on the wording of these provisions, that for tax years, periods, cases or tax obligations in general up to 31 December 2013, the reduction to 60% also includes the late payment interest of art. 53 of GTPC imposed, whereas, for tax years, periods, cases or tax obligations in general as of 01 January 2014, the reduction to 60% only applies to the penalties imposed under arts 58, 58A and 59 of the GTPC.

Download the pdf.

Click here to see the alert in Greek.


This document contains information in summary form and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional judgment. Neither EYGM Limited nor any other member of the global EY organization can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication. On any specific matter, reference should be made to the appropriate advisor.

ΕΥ | Assurance | Tax | Transactions | Advisory

About EY

EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY refers to the global organization and may refer to one or more of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com

About EY’s Tax services

Your business will only succeed if you build it on strong foundations and grow it in a sustainable way. At EY, we believe that managing your tax obligations responsibly and proactively can make a critical difference. So our 38,000 talented tax professionals in more than 140 countries give you technical knowledge, business experience, consistency and an unwavering commitment to quality service − wherever you are and whatever tax services you need.

© 2018
All rights reserved