Since ancient times and even today, as part of the ongoing globalization, we increasingly encounter cases of individuals living and working in one country while earning income from sources located in another state. For example, a Greek tax resident of Greece earns income from a business based in the Netherlands, or a tax resident of Canada earns income from properties in Greece, or a Chinese company operates in Greece through its branch, etc.

The general rule in income taxation is that a taxpayer who has their tax residence in Greece is subject to tax on their taxable income obtained both domestically and abroad, that is, on their global income earned within a specific tax year, and also that a taxpayer who does not have their tax residence in Greece is subject to tax on their taxable income obtained in Greece and earned within a specific tax year.

In every country, there is a different tax system depending on the economic and social policies of its government at any given time. Thus, it happens that a resident of Greece who earns income, e.g., in Egypt, will be taxed on that income in the country where it is obtained according to the applicable tax system of Egypt, and then there may be an obligation to declare and be taxed again in Greece, taking into account or disregarding the tax paid on that income abroad.

To address issues arising from the double taxation of incomes in the cases mentioned above, states began to enter into agreements with each other, achieving the taxation of income or capital from only one state, while simultaneously defining which state that will be. These interstate agreements are called Double Tax Avoidance Agreements (DTAA). They are concluded between two states-parties, which is why they are often referred to as bilateral international agreements for the avoidance of double taxation.

Greece began signing DTAAs with many countries from the 1950s to the present. As a member of the Organisation for Economic Co-operation and Development (OECD), our country in negotiations for entering into DTAAs with other OECD member and non-member states follows the OECD Model Convention, which includes: a) the text of the DTAA and b) the interpretative comments (Commentaries) that interpret and clarify the provisions of the articles of the Model.

The OECD Council, on November 21, 2017, approved the update of the 2017 Model within the OECD Model Tax Convention, implementing the amendments made in 2015. Double Tax Avoidance Agreements (DTAA) are an integral part of Greek tax law. Greece, adopting the above Convention as a model, has created a network of 57 bilateral agreements for the avoidance of double taxation, which we present in this publication.