It is the next step in Greece’s path to become a tax -friendly state for the rich of the world.
The government voted a new law that will allow the operation of Family Offices in Greece.
What do Family Offices do?
Family offices are private wealth management advisory firms that serve high-net-worth investors.
They are different from traditional wealth management shops in that they offer a total outsourced solution to managing the financial and investment side of an affluent individual or family. For example, many family offices offer budgeting, insurance, charitable giving, family-owned business, wealth transfer, and tax services.
- Family offices are full-service private wealth management services that serve just one or a small number of high-net-worth families.
- Besides financial services, family offices also provide planning, charitable giving advice, concierge, and other comprehensive services.
- Single-family offices serve one individual and their family, while multi-family offices serve a few families benefiting from economies of scale. (source: Investopedia)
Forbes notes that “increasing numbers of firms labelling themselves as “multi-family offices” have been popping up to grab their share of the market for the better part of the last decade”.
What Greece does
The Greek parliament approved a new law that sets the legal framework to secure transparency and provides incentives for Family Offices to be set up in Greece:
- The Family Office company must employ at least five people in Greece within the first 12 months of its establishment.
- Its operating expenses in Greece must be at least 1,000,000 euros.
- A 7% profit margin will be added to the gross income of the company that will only be collected through bank transfers.
According to the Ministry of Finance, the law follows best international practices in the field.
The Greek government believes Family Offices will supplement its previous measures to attract tax residents in Greece. These measures are:
– the “Non- dom” scheme introduced in 2019, for investors who make significant investments in Greece and choose to move their tax residence in the country. They benefit from a favorable tax regime for their global income.
– the favorable tax regime for pensioners that transfer their tax residence in Greece (introduced in 2020)
– the 2020 tax incentives to attract in Greece foreign workers and self-employed, as well as Greeks who left the country during the financial crisis,
With the new legislative initiative for the Family Offices, the Greek Ministry of Finances says that “despite the unprecedented difficulties caused by the health crisis, it continues to implement structural reforms that contribute to attracting investments and investors in the country. “
Apart from attracting foreign capital, the Greek government believes Family Offices will create added value thanks to the relocation of employees that work at these special purpose property management companies.