Taxman to accept inheritances

The Finance Ministry is planning to allow the concession of properties to the state for the payment of inheritance tax – unless this tax exceeds the objective value of the property – and other obligations to the state, while it appears the government will have to postpone the return of the capital gains tax on properties for another year.

According to comments by Alternate Finance Minister Tryfon Alexiadis on Thursday in Parliament, and given the extensive practice of beneficiaries refusing to accept properties willed to them due to their inability to maintain them, the ministry is expected to issue a decision allowing for the settlement of inheritance tax with the concession of assets to the tax authorities. Alexiadis said that before settlements are made this way, several matters related to the value of each property must first be examined.

Crucially, if the tax is lower than the value of the property conceded, the difference may go toward covering the owner’s future tax obligations. Alexiadis said that if, for instance, a taxpayer owes 30,000 euros and the property he concedes to the state is valued at 50,000 euros, the difference of 20,000 will be used for future tax payments so that the taxpayer will be protected and the state will not miss out on revenues.

Existing legislation provides only for covering the inheritance tax by conceding a property (or properties) to the state, but without the difference being used to cover other obligations.

While addressing the Prodexpo real estate conference in Athens later in the day, Alexiadis admitted that procedures for the adjustment of property rates used for tax purposes – so-called objective values – have been delayed and that they will not be updated before the end of the year. Questioned about the capital gains tax, the suspension of which expires at the end of December, the minister said it is not feasible to apply it anytime soon as there is no appropriate mechanism to do so.

The capital gains tax is a 15 percent tax on the profit (the difference between the acquisition and sale prices), payable by the seller. Buyers have to pay a 3 percent transaction tax.