VAT: Automatic fines and tax collection for late returns
Automatically through a special system, fines for overdue payment VAT will be imposed, which will range from 250 to 500 euros.
In the context of the pressure exerted by the Independent Public Revenue Authority (AADE) for the timely return of VAT, it is implementing an automated system for imposing fines, every time a debtor submits overdue his statements.
Practically, by submitting an overdue VAT return, the fines will be confirmed automatically by the AADE digital system and will be notified electronically, directly to the taxpayers. Today the process of imposing fines is carried out by the competent DOU and in some cases it even takes months until they are imposed and notified to the taxpayers.
According to the provisions in force, in case of late submission of a VAT return or withholding taxes, fines of 250 euros are imposed for those who keep simple books and 500 euros for entrepreneurs and self-employed people who keep double books. No fine is imposed in case of late submission of an amending declaration, as long as the relevant original declaration has been submitted on time, while no fine is imposed if the initial or amending late declaration results in an amount of tax to be paid up to 100 euros.
In a second stage, AADE also plans the automatic collection of VAT every time a transaction with plastic money is carried out, a measure which, however, presupposes a new adjustment of the cash systems companies and freelancers so that every time there is an automatic separation of the revenues that are collected and must be attributed to the State (VAT) and those that constitute the income of the business or the freelancer.
The 2025-2029 Strategic Plan of AADE foresees that the VAT imposed on transactions will be confirmed and collected automatically, at the time of the transaction. When the measure is implemented in practice, the VAT will be paid to the State at the time of the transaction and will not be required to be paid by the professional, with the monthly or quarterly periodic VAT statements.
Both measures aim to limit losses in VAT revenue by increasing tax collection from the current 80-85% to close to 100%.
The State’s losses from VAT are estimated at approximately 3 billion euros per year, despite the improvement recorded in the so-called “VAT gap”. Greece still remains in the 23rd worst position among the 27 EU member countries
Especially for the “automatic” fines, the updated action plan of the AADE, provides for the “Automation of the issuance of fines” during the submission of VAT returns, recapitulation tables, reclassification declaration as well as income tax declaration, return of withheld taxes, ship tax, fishing tax, tugboat tax and self-propelled dredges, levy on imported currency, dividend tax, extraordinary remuneration and percentages (bonus).
The relevant decision, according to the schedule, should be issued by December 31, 2024 in order to be put immediately into practical application.