The definition of corporate tax residence has been reviewed by the new Tax Code (4172/2013 of 23 July 2013).
Under the new rules, a company is deemed to be resident in Greece if:
- It is incorporated under Greek law;
- It has its registered seat in Greece; or
- It is effectively managed and controlled from Greece at any time during the tax year.
Whether a company is deemed to be effectively managed and controlled from Greece is a question of fact. The law lists a number of non-exhaustive factors that can be used in such determination, including the place where daily administration takes place and the place where the annual general meeting of shareholders/ partners or the board of directors are held. However, other indicative factors, such as the residence of the majority of shareholders or partners, need to be taken into account.
Greece issued guidance on the determination of corporate tax residence during the COVID-19 pandemic. The guidance clarified that, due to travel restrictions imposed, the period from 18 March 2020 to 15 June 2020 will not be taken into account in determining corporate tax residence where the conditions depend on conducting of activities/management in Greece. However, this exception is not applicable, where there would normally be conducting of activities/management in Greece regardless of the COVID-19 restrictions.
A guidance issued on 25 June 2021 provides that the period from 9 November 2020 to 14 May 2021 will not be taken into account in determining the tax residence of foreign companies whose directors are physically present in Greece during this period due to COVID-19 measures.
Further, in the period between 16 June 2020 and 9 November 2020, the impact of physical presence on residence will be determined on a case-by-case basis considering applicable travel restrictions during that period.