More and more people are receiving their pensions abroad. Greece is popular as a retirement home under palm trees - this is also due to the low tax rates.
Athens – Greece is one of the most popular holiday destinations for Germans. Winters are mild, the sun shines over 300 days per year and the cost of living is comparatively low. More and more pensioners are also moving their retirement homes to the country on the Mediterranean.
Greece attracts foreign pensioners with low tax rates
The German pension insurance pays around 1.8 million pensions every year to over 150 countries around the world. One of them: Greece. The Greek government is pleased. Prime Minister Kyriakos Mitsotakis wants to attract pensioners with tax incentives: Foreign pension recipients pay an income tax rate of just seven percent, provided they spend at least 183 days per year in Greece. “The flat rate is levied on the pensioner’s entire income earned abroad and is valid for 15 tax years,” explains Dirk Reinhardt, partner in the law firm MStR Law in Athens, to
Handelsblatt
. However, there are also exceptions that still have to be taxed in Germany - such as rental income from Germany or civil servants' pensions.
Rural areas in Greece are particularly popular with foreign retirees. “The need for peace and privacy has been increasing since the pandemic,” explains Christian Seyrer, managing director of a real estate service specializing in Greece, to
Handelsblatt
. “Some customers also want to go to rural areas because they feel less exposed to dangers such as attacks.” From the expert's point of view, we recommend places that don't depend too much on tourism, so that infrastructure and cultural offerings also exist outside of the main season. Another advantage of living in the country is security. According to the Foreign Office, pickpocketing and car break-ins occur particularly in large cities such as Athens, Thessaloniki and Piraeus.
Tips for retiring in Greece
Apply for a tax number
: The AFM (Attribution of Tax Identification Number) is the “entrance ticket” to life in Greece because it is required for concluding contracts. You also need it if you want to rent an apartment or open a bank account.
Residence permit
: The same applies to pensioners from EU countries: Anyone who moves to Greece needs a residence permit. This can be applied for at the immigration police.
According to statistics from Deloitte,
house prices
are significantly cheaper at 1,330 euros per square meter than in Germany, where you pay 4,880 euros per square meter. Experts recommend consulting a lawyer who specializes in real estate law, as unclear ownership structures or illegal buildings are not uncommon in Greece.
Health insurance
: Anyone who was compulsorily insured in Germany will remain compulsorily insured in statutory German health insurance even if they move within the European Union, according to the German Pension Insurance. With a European insurance card, German pensioners can take advantage of the Greek healthcare system. In order to avoid long waiting times for operations, for example, private clinics are recommended, but you then have to pay for them out of your own pocket.
Looking for advice
: The German pension insurance offers advice on pensions abroad and the Greek state provides information to those interested on the “Your Guide to Greece” page.
A look at life in retirement in Greece: The couple lives on 1,200 euros per month
The minimum wage in Greece has been 830 euros since April 1st. For comparison: In Germany there is at least 12.41 euros per hour and therefore 2,151 euros for a full-time job. Accordingly, you can live well in the Hellenic Republic with a pension from Germany, as the example of a couple from Ulm shows. Manfred and Karin Reuter live as a couple on the popular holiday island of Crete on around 1,200 euros a month. The rent is just 550 euros per month, but there is 140 square meters with three terraces and only ten minutes from the beach.
The additional costs for electricity, water and heating are 75 euros, the couple's expenses for groceries, cars, cell phone contracts, medication, etc. are 571 euros. After deducting all costs, the couple can even save 500 euros a month. “The deciding factor was where we could get the best possible quality of life from my almost 1,700 euro pension,” Manfred Reuter told Bild
about
the decision to move to Greece.