TAX ALERT

Greece: Digital Accounting and Tax Reporting Update “myDATA”

The electronic bookkeeping application “my Digital Accounting and Tax Application” (myDATA) was initially presented, as regards its main features, and released for public consultation, in August 2019. Then, the Greek tax authorities had explicitly stated that “myDATA” would turn operational within 2020.  

Despite the anticipated and justified delay due to COVID-19, the Greek tax authorities recently issued further instructions as regards the extent, timing and technicalities of “myDATA” (A. 1138 – 15.6.2020).

Electronic Bookkeeping "myDATA"- Core idea and main objectives

The core idea behind “myDATA” is that all entities who are obliged to comply with the provisions of the Greek Accounting Standards, irrespective of their legal form, size or way of issuing their tax files (via electronic invoicing provider, ERP or manually), will have to report electronically to the Greek tax authorities, the basic information of all the tax files they issue on a real time basis. Moreover, they will have to report, within a reasonable time, the basic information of all the other files that ultimately form their respective accounting and tax bases (purchases/expenses, provisions, depreciation/amortization etc.).

The outspoken main objectives of “myDATA” are:

  • to decrease the administrative burden for businesses as regards their tax reporting, via the prospective automatic pre-filing of all their tax returns and the cessation of certain tax reporting obligations that shall eventually become obsolete thereon, e.g. the annual lists of transactions with locally established customers and vendors (“MYF”);
  • to facilitate audit reconciliations, within the broader aim of tackling tax evasion and smuggling;
  • to enable the Greek tax authorities to proceed earlier to tax refunds for compliant businesses.

Information reported

More specifically, Greek businesses will have to report to “myDATA” a summary of:

  • the basic information of all the tax files they issue (wholesale/retail invoices, files issued in cases of self-supplies etc.);
  • the basic information of certain tax files they receive (i.e. invoices for acquisitions issued by foreign entities, records issued for transactions with financial institutions, payment receipts to social security institutions, invoices issued by counterparties who failed to report them themselves, etc.).

The term “summary”, as interpreted for “myDATA” purposes, means the minimum obligatory content of invoices as stipulated by the Greek Accounting Standards (i.e. tax identification number of the issuer and the recipient, date of transaction, net value and VAT (if any) etc., excluding however the detailed analysis of the goods and services under consideration).  

Further, Greek businesses will have to classify properly every transaction in which they are involved, on the basis of 17 standardized classifications drawn up by the Greek tax authorities (i.e. wholesale invoices issued, expense invoices received etc.). Said classification aims to enable the prospective automatic pre- filing of the various tax returns that businesses are obliged to file throughout the tax year (VAT, withholding taxes (WHT), income tax etc.).

Deadlines for data reporting  

Summary and classification of files issued by the businesses liable for reporting: Ιn real time.

Summary and classification of certain files that businesses liable for reporting receive: Until the filing deadline of the relevant VAT return.

Classification of files reported by counterparties: Until the filing deadline of the relevant VAT return.

Payroll accounting entries: Until the filing deadline of the relevant WHT return.

Records for the conclusion of the accounting and tax year result (accounting and tax bases): Until the filing deadline of the relevant income tax return.

Implementation date

From 20.07.2020 businesses who issue their invoices via Electronic Invoicing Providers are obliged to report the summary of the tax files they issue, thereon. Further, they may proceed with the classification of said tax files, on an optional basis.

From 01.10.2020 businesses who issue their invoices by other means (via ERPs, manually) are obliged to report:
a) the summary and the classification of the tax files they issue thereon;
b) the classification of the tax files they receive thereon.

By 31.12.2020 all businesses liable for reporting are obliged to report:
a) the summary and the classification of the tax files they have issued from 01.01.2020 until 30.09.2020;
b) payroll accounting entries posted from 01.01.2020 until 30.09.2020.

By 28.02.2021 all businesses liable for reporting are obliged to report the classification of all tax files they have received from 01.01.2020 until 30.09.2020.

Tax incentives in order to opt for the issue of tax files via Electronic Invoicing Providers 

Certain tax incentives are anticipated for businesses who will optionally opt for the implementation of electronic invoicing via an Electronic Invoicing Provider, pursuant to a relevant law amendment that is expected to be voted shortly by the Greek Parliament:

  • Businesses who opt for the electronic invoicing via an Electronic Invoicing Provider as their exclusive means of tax files issuance, sending and archiving;
  • Businesses who opt to accept such electronic invoicing as recipients.

More specifically, such incentives are the following:

  • The shortening of the statute of limitation from 5 years to:
    a) 3 years for the businesses adopting the electronic invoicing
    b) 4 years for the businesses accepting the electronic invoicing.
  • The right of full tax depreciation of the expenses effected for the initial installation of the corresponding technical equipment on the year it occurred, increased by 100%;
  • The tax deduction of the expenses for issuance, sending and electronic archiving of electronic invoices for the first year of adopting such method, increased by 100%;
  • The shortening of the deadline for the settlement of tax refund claims from 90 to 45 days.

The aforementioned are expected to be set in force for tax years 2020-2022.