GREECE Law and Practice Contributed by: Fotodotis Malamas, Bernitsas Law
tion but for lighter taxation subject to the rule of reciprocity, the inheritance or trust subject to taxa - tion in Greece of a foreign national corporation or individual is subject to lighter taxation correspond - ing to the tax imposed by the foreign country in question. Transfers of Assets Free transfers of movable or immovable assets belonging to the State, municipalities or communities and public organisations are exempt from donation tax. By virtue of the Inheritance and Donation Code, an acquisition is also subject to independent taxation when the beneficiaries are: • public organisations, prefectural administrations, municipalities, communities, churches, holy mon - asteries, the Sacred Commons of the Most Holy Sepulchre, the Holy Monastery of Mount Sinai, the Ecumenical Patriarchate of Constantinople, the Patriarchate of Jerusalem, the Patriarchate of Alexandria, the Church of Cyprus or the Orthodox Church of Albania; and • non-profit corporations that exist, are lawfully con - stituted or are being constituted in Greece, as well as all corresponding foreign corporations subject to the rule of reciprocity and the Law for Charitable Foundations and Bequests, on the condition that they are proven to pursue purposes in favour of the nation or religion, or in a wider sense philanthropic, educational, artistic or charitable purposes within the meaning of the Law for Charitable Foundations and Bequests. In accordance with Article 29, paragraph 5 referred to above: “[T]he acquisition through inheritance of sums of money by corporations or individuals is subject to tax, which is calculated at a rate of 0.5%. The acquisi - tion through inheritance of other assets by such indi - viduals or corporations is subject to a tax calculated independently at a rate of 0.5%”. The amount of the resulting tax also includes 3% in favour of municipalities and communities by vir - tue of the provisions of Article 50 of Royal Decree 24.9/20.10.1958.
All gifts/donations of money in favour of corporations are subject to an independent tax of 0.5%, with a tax- free bracket of EUR1,000 annually. 10.2 Common Charitable Structures The Civil Code regulates the establishment, operation and dissolution of Civil Law Companies (CLCs). A minimum of two partners are required for the establishment of a not-for-profit Civil Law Company (NPCLC), which is managed by its partners (who have joint and unlimited liability) and may appoint one or more managers. A general meeting of the partners is the supreme governing body of an NPCLC and may decide on all issues relating to its operation, including: • the admission of new members; • its management; • the election of the management and its powers; • its activities; • the amendment of its articles of association; and • its dissolution. An NPCLC is not permitted to distribute profits, divi - dends or liquidation proceeds to its members without being considered a profit-seeking civil law company, and upon its dissolution any liquidation proceeds will be transferred to organisations with similar purposes in accordance with the provisions of its articles of association or the decision of a general meeting. Liability of Partners The entry into force of Law 4072/2012 confirmed the provisions regarding the liability of the partners of a registered NPCLC, and clarified that they are held jointly and severally liable with the NPCLC for its tax liabilities. NPCLCs are subject to 22% income tax for any income received or gained. This article, as initially interpreted by the Ministry of Finance, provides for the taxation of all income and resources of NPCLCs, regardless of the source of the funds. Following the issuance of supplementary Interpretative Guidelines by the Ministry of Finance, NPCLCs are subject to taxation at the rates stated above only in respect of income deriving from commercial activities. Partners’ contributions and subscription fees, dona - tions and aid received from enterprises and third par -
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