VAT or transfer tax? The question that moves the price by 20%

Two apartments in the same building, both advertised at €320,000. One is a resale, the other is from the developer — a first sale. On the first you will pay about 9% over the price. On the second, it depends on one sentence in the preliminary contract.

How it works

In Greece, the first sale of a newly built property formally attracts VAT at 24% instead of the 3.09% transfer tax. The rule applies to buildings whose planning permit was issued after 1 January 2006.

That obligation has, however, been suspended for years. The suspension is extended year by year and currently runs to 31 December 2026. While it holds, the buyer of a new build pays the same 3.09% transfer tax as the buyer of a resale.

Where the risk actually sits

The risk is not that VAT will „suddenly be reinstated“. The risk is in the timing overlap.

New builds are often bought on a preliminary contract, with staged payments, and the notarial deed follows months later — sometimes after the suspension period has expired. Tax treatment is determined by when the tax liability arises, not by when the preliminary contract was signed.

If the preliminary contract is drafted so that the price is „net, excluding taxes and duties“, and the suspension is not extended in the meantime, the buyer pays the difference.

Three questions before you sign

1. Is the advertised price VAT inclusive or plus VAT? Put the question in writing, by email, and keep the answer. A verbal answer is worth nothing once a fifty-thousand-euro difference appears.
2. Is the tax treatment written into the preliminary contract? The wording should leave no room: who bears VAT if the obligation revives, and what happens to the deposit if the parties cannot agree.
3. How long does the suspension run at the date of signing? Have your lawyer check the current position, because the date moves. What is true in September need not be true in December.

When VAT does not come into it at all

A resale — every second and subsequent sale — never enters the VAT system. Transfer tax always applies there. The same holds for new builds permitted before 2006, and, as a rule, for first-home purchases meeting the conditions for exemption.

In practice: if you are buying from a private individual who has lived in or let the apartment, the VAT question does not arise. It arises when the seller is a developer or a company, and it is the first sale of that apartment.

What this means for the negotiation

Uncertainty over the tax treatment is not a reason to avoid new builds. It is a reason to contract for them differently than for a resale:

• Agree the price as gross, all taxes included, or define clearly who bears the difference.
• Tie the date of the notarial deed to a specific date, not to „completion of works“.
• If the deed is postponed at the developer's initiative beyond the agreed date, have the tax risk pass to them from that point.

None of this is an unusual request. Serious developers in Athens have worked with foreign buyers for years and are used to it. A party refusing to put the tax treatment in writing is refusing to carry a risk they understand well — and that is worth factoring in.

Note: all prices we quote include VAT unless expressly stated otherwise. On new builds we always check and mark whether the advertised price is VAT inclusive or plus VAT.