Short-term landlords’ status
From now on, the business activity of short-term real estate leasing by individuals and enterprises who utilize three or more properties in this way will be declared with a new Activity Code (KAD). As a business activity, the income from it will be taxed at a rate of 22%.
In addition, the activity will be subject to a value-added tax (VAT) regime similar to that of hotels – whose rate is at 13% for accommodation – and most certainly to an accommodation fee, as well as a visitor fee, according to what has been made known so far.
Conversely, those who utilize up to two properties through short-term lettings will remain with the current regime – i.e. tax rates for property rental income only.
At the same time, there will be a further tightening of control procedures by cross-checking data from online rental platforms, such as Airbnb, in order to further limit the phenomenon of undeclared rentals. All changes will take effect from January 2024.
These interventions were announced by the prime minister himself. In particular, Kyriakos Mitsotakis spoke about “structural intervention” which “responds to an issue that we have discussed many times and that is none other than the unethical short-term rental.”
“Yes, we want short-term leasing, it is a competitive product that supports the Greek economy and the income of property owners, but it is an activity that in various regions of the country has sent rents soaring and distorted competition, especially in tourism,” he said. “From January, therefore, the income from such leases, from three or more properties, will be subject to VAT and the fees applicable to hotels and rooms for rent,” he noted.
More details on the issue are to be announced on Tuesday by National Economy and Finance Minister Kostis Hatzidakis and Deputy Ministers Haris Theocharis and Thanos Petralias.
The issue of short-term leases has been of intense concern to all Greek tourism operators in recent years, as it is estimated that now up to 20% of the economic activity of hospitality related to accommodation is generated by short-term leases.
