With Law No. 4935/2022, the process of converting a Sole Proprietorship into a Private Capital Company (IKE) was provided for, offering tax and financial incentives under the following conditions:
a) Commencement of operations of the Sole Proprietorship 3 years before before the date of conversion,
b) Maintenance of accounting records using using the double-entry system by the new IKE
c) In the case of converting multiple individual businesses into IKE, the turnover of the new company must be equal to or greater by one hundred and fifty percent (150%) of the turnover of the individual business with the highest turnover among the said individual businesses over the last three years.
The advantages provided by this law are:
- Exemption by thirty percent (30%) from the payment of income tax on pre-tax profits.
- 2. Duration of exemption up to nine (9) tax years, starting from the year following the date of conversion of the individual business into IKE That is, if the conversion is completed in the year 2024, the tax exemption will be effective from the year 2025.
- The amount of exemption cannot exceed the total amount of € 500,000 during 9 years.
- The possibility of retaining in force in favor of the new IKE all administrative licenses, including licenses specifically issued for the individual business.
- Transfer to IKE of all rights and claims secured by the individual business from various authorities, both national and European, while maintaining the benefits of Law No. 4690/2020, to which the individual business had been included regarding reduced insurance contributions, which are transferred to IKE.
- Exemption from property transfer tax and from any taxincluding income tax on the resulting surplus, stamp duty, or any other fee payable to the State, as well as any contribution or right in favor of any third party, while there is no requirement to submit a property transfer tax return regarding the transfer and transfer of the assets of the converting business.
You can send us a message on the Contact Form or you can call us in our office in Athens 2106810690 or in Thessaloniki 2310477725 to discuss all the above.
