How Upcoming Tax Changes Benefit Property Owners in Greece

Real Estate

19.09.2025

Homeowner calculating rental income tax Greece savings in 2026

During the 89th Thessaloniki International Fair, the Greek Prime Minister Kyriakos Mitsotakis announced several property tax changes that directly affect primary residence owners and potential foreign buyers. If you own a home or plan to buy property in Greece, here’s what you need to know about the new tax measures announced in early September 2025.

Greece property tax changes explained

ENFIA Property Tax Relief for Village Homeowners

There is good news for those owning a property in a small town or village in Greece with 1,500 or fewer inhabitants. As the Greek Prime Minister announced, in 2026, owners of a primary residence in such areas will see a 50% reduction in their yearly property tax (ENFIA). By 2027, this tax will be entirely eliminated for this category of homeowners. This measure will benefit property owners in 12,720 Greek villages. It’s worth noting that this relief applies only to primary residences, not holiday houses or second homes, and aims to support communities outside major cities. Keep in mind that a primary residence is a property that constitutes a person's main and permanent place of residence.

Mountainous village in Greece, Peloponnese

Simplified Rental Income Taxes Starting 2026

More and more property owners are choosing to rent out their homes, either on a long-term or short-term basis, to secure extra income. A new intermediate rate announced by the Greek government for a group of these owners aims to make the tax scales more straightforward. According to the Greek Prime Minister’s announcement, rental income between €12,001 and €24,000 will be taxed at a lower rate starting from 2026. Until 2025, rental income between €12,001 and €35,000 is taxed at 35%. Under the new rules that will take effect in 2026, a new rate of 25% will be implemented, creating a fairer and smoother tax scale.

Annual Income from Rentals	2025	2026
€0-€12,000	15%	15%
€12,001-€24,000	35%	25%
€24,001-35,000	35%	35%
€35,001+	45%	45%

For example, if you earn €20,000 from the rent of your house, your tax is going to be like this:

Currently (2025): €12,000 × 15% = €1,800 €8,000 × 35% = €2,800 Total: €4,600

From 2026: €12,000 × 15% = €1,800 €8,000 × 25% = €2,000 Total: €3,800

Benefit: €800

These rental income tax rates apply per property owner. This means that if a home has two owners (for example, a couple who bought a property together), both owners will benefit individually. Additionally, for those who earn no more than €12,000 annually from rentals, the first €5,000 of rental income from a primary residence will be taxed at a reduced rate of either 5% or 7%, instead of the standard rate of 15%.

Greek property documents with magnifying glass on wooden desk, Mediterranean sunlight highlighting legal papers and seals.

Lower VAT for Border Islands

If you are living in one of the smaller border islands, you will also benefit from lower VAT rates. As announced by Prime Minister Mitsotakis, the VAT will be reduced by 30% in 2026 for all border islands with a population of up to 20,000 residents. Previously, this measure applied only to five islands. It is now being extended to dozens of areas such as the Northern Aegean, the Dodecanese and Evros. More specifically, the islands that will be included in the reduced VAT-rate are:

Municipality	Prefecture	Population
Lipsi	Dodecanese	778
Tilos	Dodecanese	746
Agathonisi	Dodecanese	202
Chalki	Dodecanese	475
Megisti	Dodecanese	584
Kalymnos	Dodecanese	17,752
Nisyros	Dodecanese	1,048
Patmos	Dodecanese	3,283
Symi	Dodecanese	2,603
Karpathos	Dodecanese	6,567
Kasos	Dodecanese	1,223
Astypalaia	Dodecanese	1,376
Limnos	Lesvos	16,411
Agios Efstratios	Lesvos	257
Ikaria	Samos	8,843
Fournoi	Samos	1,343
Oinousses	Chios	911
Psara	Chios	420
Samothrace	Evros	2,596

VAT Exemption for New Constructions

Though not officially announced yet, the 24% VAT rate on newly built homes is not expected to apply in 2026 either. Under the current rules, constructors can request an exemption from VAT for specific projects within certain periods. The suspension of VAT on new construction started in 2020 and has been extended every year since. Essentially, this means that instead of 24% VAT, new properties are subject only to 3.09% transfer tax, making it easier and more affordable to buy a brand-new home. For the buyer, this translates into significant savings, as VAT is much higher than the property transfer tax.

Property Tax Changes at a Glance

In summary, the measures announced in September 2025 include: - Lower yearly property taxes for small-town homeowners - A reduction of tax rates for rental income between €12,001-€24,000 - A lower VAT rate for border islands and a VAT-exemption for new constructions Ultimately, through these new measures, large groups of property owners in Greece will benefit. Whether you’re a current homeowner or planning to buy in Greece, these tax changes can help you plan your property budget and rental income for 2026 and beyond. For a complete guide about property taxes in Greece, see the related Elxis blog, updated for 2025.

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