Presumptions of living expenses change after 20 years: Up to 73% reduction – Tax relief for 477,000 households

For the archetypal clip successful astir 20 years, the authorities is moving — retroactively from this twelvemonth — to drastically trim presumptive living expenses, cutting them by 30% for residential properties and up to 73% for cars.
The betterment aims to easiness the taxation load connected astir 480,000 taxpayers who find themselves each twelvemonth caught successful the “trap” of imputed income.

The measurement forms portion of the broader tax betterment package announced astatine the Thessaloniki International Fair (TIF) successful September and is included successful the draught measure presented for nationalist consultation connected Tuesday by Minister of Economy and Finance Kyriakos Pierrakakis, up of a parliamentary ballot successful the coming weeks.

Three Axes of Intervention

The overhaul of the presumptive surviving expenses model is threefold, providing for:

• A 30% simplification successful imputed income for residential properties,

• A sharp chopped for cars based connected motor size and CO₂ emissions, and

• Exemption of babelike children with their ain income from the minimum nonsubjective expenditure of €3,000 — a long-standing demand, peculiarly for ample families.

According to the bill, the alleviation measures volition instrumentality effect immediately, applying to income earned from 1 January 2025, which volition beryllium declared and taxed successful spring 2026.

Housing: 30–35% Reduction

“Objective surviving expenses” — arsenic the notorious presumptive expenses were renamed 19 years agone — use erstwhile the taxpayer’s declared income falls abbreviated of the magnitude imputed by the taxation authorities, based connected ownership oregon usage of existent estate, vehicles, swimming pools, boats, and different assets.

The quality betwixt declared and imputed income is taxed, often starring to important further liabilities — peculiarly for those renting oregon surviving successful high-value properties.

The caller betterment reduces the marginal complaint for each lodging categories by 30%, easing the load substantially.
For example:

• An 80 sq.m. home’s imputed income volition autumn from €3,200 to €2,240, redeeming taxation connected €960 of income.

• For a 120 sq.m. home, the simplification reaches €1,760 per year, from €5,800 to €4,040.

High-Value Areas See Even Greater Relief

Properties located successful high-zone-value areas — wherever further surcharges use — basal to payment the most.
The simplification tin scope 35%, with the surcharge chopped from 40% to 30% successful areas priced betwixt €2,800 and €4,999 per sq.m., specified arsenic Glyfada, Chalandri, and different bluish oregon confederate suburbs.

For instance, a 120 sq.m. location successful specified an country volition spot its imputed income driblet from €8,120 to €5,252, a €2,868 yearly reduction.
In adjacent much costly “VIP” zones, specified arsenic Kolonaki, Psychiko, Ekali, and the Athens Riviera, the surcharge is reduced from 70% to 58%, delivering up to 35% little taxable income.

Cars: “Green” Reductions for Newer Models

For vehicles, a hybrid calculation system is being introduced, combining engine capacity and CO₂ emissions, with the largest benefits going to eco-friendly and small-capacity cars.
A minimum yearly presumption of €2,000 is acceptable for cars up to 1,200 cc, but lone for vehicles registered aft November 1, 2010.

Examples:

• A Toyota Corolla 1.8 Hybrid (99 g/km CO₂) sees its presumptive income autumn from €7,600 to €2,000 — a 73.7% reduction.

• A Honda Jazz 1.5 Hybrid (102 g/km) drops from €5,800 to €2,000, a 65.5% cut.

• A Fiat 500 1.0 (999 cc) sees its presumption halved, from €4,000 to €2,000.

• A BMW 116i (1,499 cc, 129 g/km) decreases from €5,800 to €2,210 (–61.9%), portion a Mercedes A200 (1,332 cc, 133 g/km) falls from €5,200 to €2,330 (–55.2%).

• Even larger models, similar the Audi A4 35 TFSI (1,984 cc), driblet from €8,800 to €2,450 (–72.2%), and the Audi Q3 35 TDI (1,968 cc) from €8,800 to €2,645 (–69.9%).

Who Benefits

The reductions payment astir 477,000 taxpayers presently burdened by the spread betwixt declared and imputed income — chiefly middle-class households, homeowners, renters, and families with 1 oregon much cars.

The full fiscal cost of the measurement is estimated astatine €40 cardinal per year, arsenic portion of the €2.7 cardinal budget for the 2025 TIF package.
The simplification applies from fiscal twelvemonth 2026 and volition beryllium permanent and recurring.

Additional Reforms and Broader Context

Beyond the reductions, the measure besides exempts babelike children with income from the minimum nonsubjective expenditure of €3,000 antecedently imposed per individual.
This alteration means families with moving big children volition nary longer look other imputed income simply due to the fact that their children clasp abstracted taxation IDs.

The overhaul accompanies a broader revision of the income taxation scale — benefiting astir 4 cardinal taxpayers — on with a cut successful ENFIA for tiny communities and the introduction of a caller 25% intermediate rate connected rental income.

Altogether, the measures purpose to strengthen middle-class purchasing power portion remaining wrong the government’s fiscal targets.