IRIS Transfers: When Money Movements Trigger Tax Scrutiny in Greece

In Greece, making daily money transfers through the IRIS electronic payment system or directly via bank accounts does not automatically trigger a tax obligation. The crucial factor for tax authorities is not the mere use of an electronic service, but the underlying reason, frequency, and the overall financial picture presented by these transactions.

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The issue that matters to the tax administration is the reason for the transfer, the frequency of transactions, and the overall picture that emerges from the money movements.

There isn't a set monetary limit that automatically deems a transfer tax-free. Instead, tax authorities scrutinize the pattern of transactions. Small, occasional transfers for everyday expenses or to split shared costs are generally not considered taxable income simply because they are electronic. However, the situation changes when transfers are large, systematic, and lack an obvious economic justification.

In such cases, tax authorities may investigate the nature of these transactions to determine their true purpose, such as whether they constitute a monetary gift or payment for services. A consistent pattern of significant money flows between two individuals is viewed differently from an occasional small transfer between friends or relatives.

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There is no specific monetary limit under which a transfer is automatically considered tax-free, and above which a tax issue arises.

Special provisions exist for transfers between close relatives. Gifts to Category A recipients, which include parents, children, and grandchildren, have a tax-free allowance of up to 800,000 euros, provided the gift is documented through a financial institution transfer. This specific allowance does not apply in the same way to gifts between friends, where the tax treatment depends on the recipient's category and relationship to the donor. The IRIS system itself is merely a transfer method and does not define a transaction as a gift or taxable income.

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The use of IRIS simply constitutes the method by which the money transfer is made. It does not mean that every amount moved through the service constitutes a gift or taxable income.