Rental income tax 2026 in Greece: the 25% bracket, examples and the 2027 return

The new 25% rate on property income sounds simple, but the phrase "25% tax on rents" is misleading. The whole rent is not taxed at 25%, and the scale does not change for rents earned through the end of 2025. The new scale applies to income earned from tax year 2026 and will appear in the return filed in 2027.

The practical difference lies in the second bracket. Through 2025, taxable property income from EUR 12,001 to EUR 35,000 was taxed at 35%. From 2026, the portion from EUR 12,000.01 to EUR 24,000 is taxed at 25%, while the next portion, from EUR 24,000.01 to EUR 36,000, remains at 35%. The top rate of 45% now begins above EUR 36,000.

This article explains which amount falls into each bracket, how the 5% lump-sum allowance works for individuals, what happens in co-ownership, how forms E2 and E1 connect, when electronic rent payment is required and how uncollected rents are treated.

1. What changes from tax year 2026

Law 5246/2025 amended paragraph 4 of Article 40 of the Greek Income Tax Code. Its commencement provision expressly links the change to income earned from tax year 2026. The two scales compare as follows:

The main benefit arises in the EUR 12,000.01-24,000 slice, where the burden falls by ten percentage points. There is a smaller difference in the EUR 35,000.01-36,000 slice because the 45% rate now starts only above EUR 36,000.

2. Why 25% does not apply to the whole rent

The scale is progressive. Each rate applies only to the portion of taxable income within that bracket. If taxable income is EUR 20,000, the first EUR 12,000 is taxed at 15% and only the next EUR 8,000 at 25%.

An extra euro therefore does not move the entire income into a higher rate. It moves only the excess portion. Confusing the marginal rate with the average effective rate often produces incorrect calculations and exaggerated headlines.

3. Examples before and after the new scale

The examples below concern an individual and apply the 5% lump-sum allowance solely for comparison. They do not include a special exemption, subletting, foreign tax, uncollected rent or any other individual circumstance.

The maximum comparative benefit from the scale change reaches EUR 1,300 once the full new 25% bracket and the additional EUR 35,000.01-36,000 slice have been used. The actual tax, however, comes from each taxpayer's declared facts, not from a general table.

4. The taxable base and the 5% allowance

The starting point is the gross property income attributable to the taxpayer. Official tax guidance provides, subject to the statutory conditions, a 5% lump-sum allowance for repair, maintenance, renovation and other fixed or operating costs when the lessor is an individual.

This allowance does not mean that every actual expense is also deducted, nor that the amount credited to a bank account automatically equals the taxable base. Subletting, free use, owner-occupation, income in kind and special exemptions have additional rules. The calculation must therefore begin with the legal right involved and the type of letting.

5. Which income is combined under the same scale

The scale applies to the same taxpayer's total property income, not separately to each apartment. In practice, amounts reported as rent or subrent, together with other forms of property income falling under Article 39 of the Income Tax Code, are combined.

For an individual, income from short-term letting of up to two properties, with no service other than bed linen, is treated as property income and enters the same scale. There is no independent scale for long-term rent and another one for Airbnb income.

6. When short-term letting stops being taxed as rent

Where an individual operates three or more properties as short-term lets, the income is treated as business income. The same may happen with fewer properties if services beyond bed linen are supplied. The tax base then changes and obligations concerning business registration, VAT, bookkeeping and myDATA may arise.

The number of AMA registration numbers, the operator's identity, co-ownership and the services actually supplied must be reviewed together. Applying the rental scale to an activity that has already acquired business characteristics is unsafe.

7. Co-ownership, usufruct and joint tax returns

In co-ownership, each owner does not report the whole rent. The E2 instructions state that each liable person reports the gross income attributable to their co-ownership, co-usufruct or other right. That person's share is then added to their other property income.

Spouses file a separate E2 for the properties belonging to each of them, even where they file a joint return or co-own a property. Ownership, usufruct and the right to receive rent should agree with E9, the lease information and the actual letting arrangement.

8. How income moves from E2 to E1 and when it is declared

The property lease information statement records the contractual relationship. E2 lists the properties, type of use and gross amounts in detail. Once E2 is submitted, its amounts are transferred to the corresponding E1 fields, where the final tax assessment is made.

Rent earned during 2026 is subject to the new scale and will be reported in the 2027 income tax return. The new scale does not apply retroactively to 2025 income declared in 2026. Where rent spans more than one period, it must be allocated correctly to the tax year in which it was earned.

9. Lease filing and electronic payment are separate duties

For a long-term lease, the owner submits the lease details electronically by the end of the month following the agreement. Filing lease information does not replace E2 and E1, and the annual tax return does not automatically cure incorrect lease information.

According to the Ministry of Economy and Finance announcement of 30 March 2026, mandatory rent payment through a bank account was postponed to 1 October 2026. Lessor and tenant should use a clear payment reference and an account that allows each transfer to be linked to the relevant lease.

10. How uncollected rents are treated

Rent is not treated as uncollected merely because the tenant is late or no credit appears in the account. Before E2 is filed, the taxpayer must follow the procedure before the competent authority and provide at least one of the documents required by Article 39(4) of the Income Tax Code and the related decisions and circulars.

Only after that administrative procedure is completed is the amount recognised as such entered in E2. If it is collected in a later year, it is reported then according to property category and lease type. Prompt legal action matters; a simple extrajudicial demand may not be sufficient in every case.

11. Common errors that change the calculation

• Applying 25% to the full gross amount instead of only to the second bracket.
• Using the new scale for 2025 income because the return was filed in 2026.
• Calculating a separate scale for each property or each platform.
• Each co-owner reporting the full rent rather than their attributable share.
• Confusing the net bank credit with gross taxable property income.
• Removing uncollected rents without completing the required prior procedure.
• Treating three short-term properties or additional services as ordinary property income.
• Leaving inconsistencies between the lease, E2, E9 and the actual ownership rights.

12. Practical check before the tax year closes

1. Collect active leases, amendments and terminations for each property.
2. Confirm ownership, usufruct and co-ownership percentages in E9.
3. Reconcile monthly gross rent with bank movements and explain each difference.
4. Separate amounts by tax year and by beneficiary.
5. Check whether short-term letting remains property income or has become a business activity.
6. Do not wait until return season to deal with uncollected rent.
7. Apply the new scale to the taxable base, not the net bank receipt.
8. Keep the E2 submission receipt and verify the amounts transferred to E1.

13. Frequently asked questions

If I receive EUR 20,000, is all of it taxed at 25%?

No. After the taxable base is determined, the first EUR 12,000 is taxed at 15% and only the next slice up to EUR 24,000 at 25%.

Does the new scale cover 2025 rent declared in 2026?

No. The law states that the change applies to income earned from tax year 2026. That income is declared in 2027.

I own two apartments. Does each receive its own first bracket?

No. The same taxpayer's property income is combined. The scale applies to the total taxable amount, not separately to each property.

For a 50-50 property, do both owners report the whole rent?

No. Each co-owner reports the gross income corresponding to their share and is taxed according to their own total property income.

Does the 5% allowance let me deduct all repair receipts as well?

Not as a general rule for an individual. It is a lump-sum recognition of costs subject to statutory conditions. Specific actual costs are treated separately only where the law expressly provides.

If the tenant does not pay, can I simply omit the amount?

No. The prescribed prior procedure and supporting documents are required before rent can be reported as uncollected. Otherwise it may remain taxable as reportable income.

14. What a property owner should retain

The new scale materially reduces tax for those whose taxable property income exceeds EUR 12,000, but it does not change the work that precedes the calculation. Lease data, rights, ownership percentages, gross amounts, the relevant period, uncollected rent and the legal classification of the activity must all be correct first.

The safest approach is a file for each property and an annual reconciliation table for each beneficiary. The 2027 return can then begin with checked information rather than isolated bank entries, and the calculation can be supported in a later audit.