Costs of not having rent paid through the bank

• 5 July, 25

The rent payment regime is changing permanently, as the obligation for electronic payment of rents via bank account comes into force, with the aim of combating the undeclared economy and enhancing transparency in real estate transactions.

The relevant provision was incorporated into the new Customs Code that has just been put up for public consultation and brings serious consequences to those who do not comply, both on the part of owners and tenants.

In all cases of leasing or subleasing a property, whether to a natural or legal entity, the payment of the rent is made exclusively through the lessor’s bank account. This account must be declared to the Independent Authority for Public Revenue (AADE).

The obligation concerns both main and secondary residences, as well as business premises.

If the owner does not collect the rent through a bank account, he cannot deduct the relevant expenses from his taxable income. This means that instead of being taxed for 95% of the rent (this is currently provided for as the annual rental income is reduced by 5% due to depreciation), he will be taxed for 100% and will be charged with 15% to 45% on the difference.

For the tenant, the consequences are as follows: He is not entitled to any state aid, allowance or benefit related to the lease if he has not paid the rent electronically. In other words, the rent refund that is to be activated from November will not be granted, while the provision leaves room for a cut in social benefits such as housing allowance.

For businesses or professionals, rents not paid through the banking system are not recognized as deductible business expenses, which leads to an increased tax burden.

Cre: ekathimerini