The obligation to file a “Public Report on Income Tax Information” by Greek subsidiaries and branches of ultimate parent companies established in third countries was introduced into Greek legislation by Law 5066/2023 (amending Law 4548/2018), transposing Directive 2013/34/EU (as amended by Directive 2021/2101/EU).
Specifically, with the introduction of Articles 157A – 157H and 180A into Law 4548/2018, a public country-by-country reporting system is established, which applies to large multinational groups with consolidated revenues exceeding 750 million euros for two consecutive fiscal years.
In this context, Greek-established medium and large (as determined in accordance with Greek Accounting Standards) subsidiaries that are controlled by ultimate parent companies established in third countries (i.e., outside the E.U.), are required to prepare and disclose a report containing information regarding the group’s tax position on a global level. A corresponding obligation is also imposed on branches of ultimate parent companies from third countries operating in Greece, under the same substantive conditions regarding the size of the group, when they report a net turnover of more than 10 million euros for each of the last two consecutive fiscal years.
In case, following a request to that effect, the foreign ultimate parent entity fails to provide the subsidiary or branch with all the required information, the latter should draw up and publish the Report based on all information in their possession, as well as a statement indicating that their ultimate parent entity did not make the necessary information available.
The Report on Income Tax Information shall include information relating to all the activities of the foreign entity, including those of all affiliated entities consolidated in its financial statements in respect of the relevant financial year.
The information included in the report shall consist of:
- the name of the ultimate parent entity, the financial year concerned, the currency used for the presentation of the report and, where applicable, a list of all subsidiaries consolidated in the financial statements
- a brief description of the nature of their activities
- the number of employees
- revenues, including transactions with related parties, which are calculated based on certain adjustments
- the amount of profit or loss before income tax
- the amount of income tax payable
- the amount of income tax paid on a cash basis, and
- the amount of accumulated profits at the end of the relevant financial year.
The obligation does not apply where a Report on Income Tax Information is drawn up by the foreign entity in a manner that is consistent with the above information and meets the following criteria:
(a) it is made accessible to the public on its website, free of charge and in an electronic reporting format which is machine-readable in at least one of the official languages of the European Union no later than 12 months after the balance sheet date of the financial year for which the report is drawn up; and
(b) it identifies the name and the registered office of a single subsidiary, or the name and the address of a single branch, which are governed by the law of a Member State, and have published a report.
With regard to the publication procedure, the income tax return and the report regarding the foreign entity’s failure to provide the required information are submitted to the General Commercial Registry (G.E.MI.) and shall be made publicly accessible indefinitely, within 12 months of the end of the relevant fiscal year, either in Greek or in English. At the same time, there is a requirement to post a notice regarding the publication in G.E.MI. as well as on the Greek entity’s website.
Responsibility for the preparation, accuracy, and publication of the report lies with the members of the Greek company’s management, while the statutory auditor is required to state in the relevant audit report whether, for the fiscal year preceding the fiscal year for which the audited financial statements have been drawn up, the company was required to publish a Public Report on Income Tax Information and, in that case, whether the report was published in accordance with the relevant provisions.
Finally, members of management who violate the disclosure obligations are subject to a fine of between 10,000 and 100,000 euros each. In determining the amount of the fine, particular consideration is given to the turnover of the entity, the financial status of the offender, and whether the same person has repeatedly committed the violation.
The introduction of the obligation to publicly disclose income tax information for Greek subsidiaries and branches of multinational groups with ultimate parent entities established in third countries marks a significant shift toward greater transparency in tax reporting and a strengthening of tax fairness. For the Greek subsidiaries or branches of the relevant multinational groups, the new framework entails increased compliance requirements, an organizational burden, as well as the need for more systematic collection and documentation of tax and financial data at a consolidated level, while specific obligations also arise for their statutory auditors.
