If you are a freelancer or an independent contractor working in Greece, you are liable to register and pay VAT in Greece. The Greek government levies a standard VAT rate of 24%, although specific goods and services fall under the reduced rates of 13% and 6%. The General Tax Code contains all the information regarding the Greek VAT law, while the Greek Ministry of Finance, in collaboration with local tax offices, is responsible for administering VAT.
If you want to hire and manage Greece-based freelancers, we have a dedicated guide just for you. If you are a freelancer looking to navigate the Greek VAT laws, this simplified article will tell you everything you need to know. Let’s get started!
VAT rates for Freelancers in Greece
There are four different VAT rates, and freelancers must charge their clients and customers based on the goods and services they sell.
- The Standard Rate of 24% - Unless the items or services you offer are in the reduced rate or zero-rate category, you should charge the standard VAT rate of 24%.
- The Reduced Rate of 13% - Applies to items such as several food products, hotel accommodations, domestic care for young elderly sick, cinema tickets, farming supplies, certain pharmaceutical products, electricity, etc.
- The Reduced Rate of 6% - Applies to some books, medicines for human use, vaccines, music, electrical energy, natural gas, district heating, walking stick, braille typewriters, etc.
- Zero VAT Rate (0%) - The services that fall under the 0% VAT rate are public service operations, gambling, insurance transactions, property leases, supply of hospital services, international passenger transport, etc. Although there are no charges on zero rates, you should record sales of goods and services and create a report based on your returns.
When Should you Register for VAT as a Freelancer in Greece?
There is no VAT registration threshold for freelancers in Greece; hence, you must register for VAT if you meet any of the following conditions:
- You sell or self-supply VAT liable goods or services in Greece
- You import goods into Greece
- You organize events and programs inside the country
- You have been conducting “Supply and Install” type services for a year
- You supply Greek goods to other EU countries
If you are an expat freelancer selling your services to consumers over the internet, the VAT registration threshold is €35,000 per year. Therefore, as soon as your annual sales revenue exceeds €35,000, you are liable to register for VAT. You don’t need to set up a local practice or company; however, like any other taxable people in Greece, you are liable to report VAT, complete payments and comply with all the VAT legislation.
Click here to view more scenarios that determine when you might need to apply for VAT.
Related: Legal obligations when working as a freelancer in Greece.
How to Register for VAT in Greece as a Freelancer
Once you have determined that you are liable to register for VAT in Greece, you can register by submitting an M2 form (‘Statement of Commencement/Change of Operations of a Natural Person’) to the Greek Tax office. If ever you change your practice, you can submit the same form to indicate the change in your operations to the tax office.
You must prepare the following documents to submit for VAT registration:
- Information about your financial activities, annual revenue, taxable financial transactions, and bank account information
- A power of attorney for the fiscal representative (if someone else is representing you)
If you are a permanent resident of Greece or any EU country, you do not need a fiscal representative. However, if you are an expat freelancer providing services to customers in Greece, you need to find a fiscal representative for tax-related purposes.
Alternatively, if you have customers in multiple countries across the EU, you can register using the Mini One-Stop-Shop, which can help you collect and report all of your VAT in a single tax return. This also means you don't need to register for VAT individually in multiple EU countries.
Financial Obligations of VAT Registered Freelancers in Greece
After your VAT registration is complete, be sure to have these following financial obligations in check as a freelancer:
- Charge the correct VAT rate
- Pay any VAT owed to Greek Tax and Customs Authority
- File VAT returns
- Maintain VAT records and a VAT account
- Keep track of all purchases, accounts, and transactions for at least eight years
- Keep a running total of your VAT account
- Correct errors from prior returns
- Ensure that VAT invoices are in electronic format, authentic, correctly signed and that the disclosure details are outlined in the Greek VAT codes
- Report and translate foreign currency accurately
Issuing a VAT invoice is a must as you cannot claim VAT on goods and services already supplied without invoices.
Reporting VAT as a Freelancer in Greece
You should submit returns detailing all sales and costs quarterly before the 25th of the month following the reporting period. However, if you exceed €150,000 per year in purchases and €90,000 per year in dispatches, you must submit reports monthly.
How to Maintain Financial Records as a Freelancer in Greece
If you are registered in the VAT MOSS system, you can maintain your financial records electronically in the VAT MOSS portal. However, you must keep copies of all transaction records for around ten years, as you are accountable if any legal authority asks for them.
You should maintain clear, complete, and precise records of the following documents:
- Printed copies of the invoices you send out
- Received invoices
- Agreements on sell-billing
- The self-billing vendors' names, addresses, and VAT numbers
- Notes (debit/credit)
- Records of imports and exports
- Records of bank statements, check stubs, cash books, till rolls, and paying-in slips in addition to your VAT account
Xolo can help you stay 100% VAT compliant and never miss out on any steps! We automatically generate, send, and store all your invoices digitally, so you won’t have to worry about misplacing them over the next decade.
Staying VAT-compliant as a Freelancer in Greece with Xolo
The VAT registration process can be tricky at times, but we hope this guide has helped clear your doubts! If you’re still confused about the different schemes and numbers, and paperwork, Xolo offers a range of solutions that handle all the hassle while you focus on your core competencies.
With Xolo Go, you can easily freelance and invoice your clients cross border, even without a registered company or LLC. You'll get an automated VAT calculator and an instant invoice generator which helps you stay compliant when invoicing your clients. Signing up takes only 10 minutes, and once you do, legal compliance, and all the tricky VAT calculations are all automatically taken care of in the background!
With Xolo Leap, you'll have the easiest and most effective way to create your own company through Estonian e-Residency! We'll register your one-person business and handle boring admin aspects like tax returns, or integrated banking. You'll get yourself unlimited transactions, branded invoices, and especially automated VAT collection and declaration. Reduce time spent on mundane business administration and focus on what you do best!
Connect with us today, we’ll help you get your one-person business up and handle your freelancer's VAT concerns in no time!
