Greece Business Structures
Types of Companies
Partnership in Greece
A partnership is the most basic form of business arrangements, and the one most frequently used in Greece for small and medium-sized companies, mainly because starting a partnership does not require a set capital and due to its simple bookkeeping method.There are two distinct forms of partnerships in Greece, OE and EE. The difference is that in OEs all participants are wholly liable for the company debts and liabilities, regardless of their percentage in the company, whereas in EEs there can be one or more participants that are only liable up to the amount of their investment. Foreigners are not able to participate in such company unless they issue a personal Tax Number.
Tax Regime: Half of the profits are taxed at 20% or 25% depending on the type of participation and the other half is taxed on the individual Tax Scale.
Taxexperts Tip: An EE is an ideal structure for setting up a small business with a Greek partner.
GreeceLimited Liability Company
A Limited Liability Company is a hybrid between an SA and a Partnership, where each investor owns a percentage of the company. Although there are no outstanding shares, liabilities correspond to the percentage of ownership, while the Director of the company is wholly liable with his personal property. LLCs have a minimum capital of 4.500€ and it adheres to ‘C-Class’ book keeping standards.Tax Regime:
- 20% on profits
- 25% of dividends (foreign Holding companies pay 0% Tax on dividends after the second year)
- 1% on capital offerings
Taxexperts Tip: the LLC is ideal as a subsidiary of a foreign company.
Societe Anonyme
The SA has a minimum starting capital set to 60,000€ and is quite rigid in its mandatory procedures.It adheres to 'C-Class' bookkeeping standard and is also required to keep Annual General Meeting and BOD records.
The SA's end-of-year fiscal statements must be compiled and reviewed by a Certified Auditor, elected by the General Meeting, if at least two of the following three criteria are met:
Balance sheet of at least 2.5 million euro, annual turnover of at least 5 million euro, 50 employees on a yearly average.
As the only company that is allowed to print stock shares, it's also the only form of company that is allowed to join the Stock Market.
Also similar to the LLC, the CEO is wholly liable with his/her personal property for debts and liabilities.
Greece Tax Regime:
- 20% on profits
- 25% of dividends (foreign Holding companies pay 0% Tax on dividends after the second year)
- 1% on capital offerings
Taxexperts Tip: the SA is recommended only for public companies and big multinational organizations.
Formation Procedures:
Despite the recent developments in the Public Services, setting up a company remains a rather complicated procedure which involves different public authorities.More specifically depending on the company type and structure you need:
- Obtain special social security for entrepreneurs (OAEE)
- Register with the Chamber of Commerce
- Register with the Legal and Court Authorities
- Register with the Companies House
- Use an attorney to sign all Legal Documents
- Obtain Tax Number and Accounting Book
Article by www.taxexperts.eu (December 2011) please click here.
Note: The information in this site is for general guidance only. Users of this site are advised to take professional advice before taking practical tax decisions.
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