No more free tax ride for Airbnb homeowners

Friday, November 24, 2017
No more free tax ride for Airbnb homeowners
In a time of unprecedented crisis, many Greeks turned to renting out their homes via Airbnb for much needed income, not least because of the huge hikes in real estate taxes over the past seven years.

Most of that income naturally went undeclared, until now, and the Greek government appears to be determined to put an end to the free ride for homeowners in Athens and other top tourist destinations around the country.

To make the message clear, a new framework for registering and taxing rental properties, with taxes of up to 45 percent of receipts and steep non-compliance fines to tune of 5,000 euros in the offing.

The governor of the Independent Authority for Public Revenues (AADE, Greece’s IRS), Yorgos Pitsilis, signed a decision, effective 1 January, 2018, requiring registration of short-term rentals and an online declaration of the income at AADE’s website

Pitsilis says the tax bureau has already initiated cooperation with digital platforms that deal in international short-term rentals to share information.

Short-term rentals will be taxed in accord with the tax scale for all-year rentals, based on the total annual rent income. That currently provides a 12,000 euro tax free limit.

The first step is for homeowners to list their property on a special AADE registry, with each apartment or house receiving a separate registration.

The “administrator” of the property, who may be the owner or the person with the legal right to use it, must submit all data necessary in order to determine the annual rental receipts.

Each property can have only one designated administrator, regardless if it is owned by more than one person.
The required data include the short-term rental registration number, the total amount of rent agreed to, any cancellation fee received by the administrator, the name of the digital platform through which the rental was arranged, the personal information of the renter, the start and end date of the rental, and the manner of payment.

A fine of 5,000 euros is the penalty for three categories of non-compliance with the new rules: Failure to list the property on the short-term rental registry; failure to clearly report the registration number in tax declarations; and failure of administrators to include the “Special Operation Permit” number in the advertisement on international short-term rental platforms.