AADE targets undeclared income from salaries, pensions, real estate, interest, dividends, retroactive earnings in Greece and abroad. The audit mechanism is intensifying cross-checks on the data and information it receives from other agencies and from more than 100 countries.
Who is in the “target”
In the scanner of the AADE auditors are mainly taxpayers who collect pensions, interest, dividends and income from properties from abroad which they avoid declaring in the tax return they submit in Greece.
Taxpayers who hide retroactive amounts of income from the Tax Office, as well as those who submit zero VAT returns while they are active, will also pass through an audit “sieve”.
Taxpayers who are found to be hiding income will be asked by the Tax Office to submit declarations on the “forgotten” income and to pay the taxes and prescribed fines.
Based on the data collected by AADE from its information systems as well as from entities outside the Authority and from other states within the framework of the International Administrative Cooperation, within the framework of the International Administrative Cooperation it conducts cross-checks that bring to light hotbeds of tax evasion and undeclared income.
Millions of euros undeclared
The intersections that AADE “ran” in 2022 revealed undeclared income of millions of euros. In particular:
- Cross-checking of incoming information from foreign authorities through the International Administrative Cooperation (DAC1) for salaries, pensions, administrative fees and income from Real Estate, with the submitted income tax returns:
For 2017, out of 131,828 active TINs, 117,092 were crossed, i.e. the identification rate reached 89%. After carrying out relevant compliance communication actions to encourage the submission of the required Income Tax Returns for the tax year 2017, 4,109 tax returns were submitted, with the tax amounts assessed amounting to 7.1 million euros.
- Cross-checking of incoming information from foreign authorities through FATCA on foreign interest and dividends with submitted income tax returns:
For 2016, out of 8,252 records, 1,668 were cross-referenced, i.e. the identification rate reached 20%. After carrying out relevant compliance communication actions to encourage the submission of the required Income Tax Returns for the tax year 2016, 302 tax returns were submitted, with the tax amounts assessed amounting to 258,000 euros.
- Cross-checking of incoming information from foreign authorities through the International Administrative Cooperation (CRS/DAC2) on interests of foreign individuals with submitted income tax returns:
For 2016, out of 27,508 identified records, 6,275 were cross-referenced, i.e. the identification rate reached 23%. After carrying out relevant compliance communication actions to encourage the submission of the required Income Tax Returns for the tax year 2016, 265 tax returns were submitted, with the certified tax amounts amounting to 79 thousand euros.
- Cross-reference to identify taxpayers who submitted zero VAT returns while having activity in the months of July, August and September 2021 (summer period 2021).
After the required processing of the files (cross-checking of data from AADE’s information systems and data received from EFKA) and after the application of subtractive criteria, 3,254 persons liable for compliance were identified. After carrying out relevant communication compliance actions to encourage the submission of the required VAT Returns, 1,251 taxpayers complied (compliance rate 38%) with a total amount of declared taxable outputs of 324 million euros and a total amount of tax certification of 9 million euros.
- Taxpayer compliance cross-check in the submission of PIT returns for additional earnings (retrospective earnings):
For the tax year 2016, communication actions were carried out (sending relevant messages to the e-boxes in Taxisnet’s personalized information, telephone communications as well as sending postal letters) to 6,730 taxpayers with retroactive payments, resulting in the submission of 4,264 amending and/or initial tax returns of various years and the tax certificate of 2 million euros.
- Cross-reference for compliance of taxpayers with pre-filled salary-pension codes (according to the statement of salary-pension statements):
For the tax year 2016, communications were made with 2,627 taxpayers, resulting in the submission of 681 amending and/or initial tax returns, due to current salaries, of various years, and the tax certification of 310 thousand euros.
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**Interview with Dr. Maria Koutouzi, Tax Compliance Expert**
**Editor:** Welcome, Dr. Koutouzi. Thank you for joining us today to discuss the recent efforts by the Independent Authority for Public Revenue (AADE) in Greece to tackle tax evasion.
**Dr. Koutouzi:** Thank you for having me. It’s an important topic that affects the Greek economy significantly.
**Editor:** To start, could you explain what the AADE is currently focusing on in terms of undeclared income?
**Dr. Koutouzi:** Certainly. The AADE has intensified its audit mechanisms targeting individuals who may be hiding income—specifically from pensions, foreign investments like interest and dividends, and real estate. They are using data collected from over 100 countries to cross-check declared taxes against actual income.
**Editor:** That’s quite a comprehensive approach. How effective have these checks been so far?
**Dr. Koutouzi:** Very effective. In recent audits, they’ve uncovered millions in undeclared income. For instance, when cross-referencing foreign pensions and salaries, they identified a high compliance rate—over 89% of active Tax Identification Numbers (TINs) were verified. This led to thousands of tax returns being filed retroactively, resulting in sizeable tax revenues.
**Editor:** It seems like there’s a clear push for compliance. What happens to taxpayers who are found to have undeclared income?
**Dr. Koutouzi:** Those individuals will be required to submit the necessary declarations for the income they ‘forgot’ to disclose, along with any applicable taxes and fines. The aim is to increase accountability among taxpayers.
**Editor:** Given the historical context where tax evasion was once described as a “national sport,” do you think these measures will lead to a cultural shift regarding tax compliance in Greece?
**Dr. Koutouzi:** I believe they can. With persistent efforts like these, along with public awareness campaigns, Greece can move towards a culture that values and respects tax obligations. It won’t happen overnight, but the groundwork is being laid for long-term change.
**Editor:** Thank you, Dr. Koutouzi, for your insights on this pressing issue. It will be interesting to see how this unfolds in the coming years.
**Dr. Koutouzi:** Thank you for having me. I hope to see positive developments in Greece’s approach to tax compliance.
**Editor:** That concludes our interview. We appreciate your time and expertise!
