Payroll in Greece for Global Employers

Step 1: Understanding Salary Structure in Greece 💼

A competitive and compliant salary structure is critical for attracting talent in Greece. Here’s a breakdown of the core salary components, as outlined in Greek labor law.

Component	Details	Mandatory/Optional
Base Salary	The agreed monthly salary, typically specified in the employment contract.	Mandatory
Overtime Pay	Paid at a higher rate, usually 1.2x for weekdays, 1.4x for Saturdays, and 2x on Sundays.	Mandatory
Bonuses	13th and 14th-month salaries (Christmas and Easter bonuses) are common in Greece.	Mandatory
Holiday Allowance	20-26 days per year, depending on tenure.	Mandatory
Allowances	Meal, travel, or housing allowances, which may be non-taxable up to a limit.	Optional

Outcome: Creating a compliant salary structure ensures that Greek payroll requirements are met, and employees are offered attractive packages.

Step 2: Income Tax Withholding in Greece 🧾

Greece follows a progressive income tax system where rates increase with income levels. Employers must deduct income tax at source and remit it to the Greek tax authorities.

Income Bracket (€)	Tax Rate
Up to €10,000	9%
€10,001 – €20,000	22%
€20,001 – €30,000	28%
€30,001 – €40,000	36%
Over €40,000	44%

Outcome: Correct withholding of income tax ensures compliance with Greek tax laws.

Step 3: Social Security Contributions in Greece 🏦

Social security contributions in Greece cover pensions, health insurance, and other social welfare benefits. Both employers and employees contribute to these programs.

Contribution Type	Employer Rate	Employee Rate
Pension Contributions	13.33%	6.67%
Health Insurance	4.55%	2.55%
Unemployment and other funds	3.16%	1.6%

Outcome: Timely contributions to social security ensure legal compliance and provide employees with necessary coverage.

Step 4: Payroll Cycle and Timing in Greece 📅

Greece typically follows a monthly payroll cycle. Most employers pay salaries at the end of each month, but mid-month advances are also common.

Payroll Cycle	Description
Monthly	Standard payroll cycle for salaried employees.
Bi-weekly	Common for hourly or seasonal employees.

Outcome: Consistent payroll timing helps employees plan finances and ensures compliance with payroll regulations.

Step 5: Paid Leave and Public Holidays in Greece 🌴

Greek labor laws guarantee various leave entitlements and recognize numerous public holidays.

Leave Type	Entitlement
Annual Leave	20 days, increasing with tenure (up to 26 days after 10 years).
Public Holidays	12 national holidays (e.g., Easter, Christmas, Greek Independence Day).
Sick Leave	Paid leave as per insurance fund rules.
Parental Leave	Up to 4 months of unpaid leave per parent.

Outcome: Proper leave management ensures compliance with Greek labor laws and supports employee well-being.

Step 6: Managing Payroll for Foreign Employees in Greece 🌏

Foreign employees in Greece are subject to Greek payroll and tax obligations. Some key considerations include:

Tax Residency: Foreign employees who spend over 183 days in Greece are considered tax residents and are taxed on worldwide income.
Social Security Contributions: Foreign employees must generally contribute to Greek social security, unless covered by a bilateral agreement.

Outcome: Employers need to manage tax residency status and social security contributions for foreign employees accurately to ensure compliance.

Step 7: Payroll Compliance and Reporting in Greece 📊

Employers in Greece must adhere to various payroll compliance and reporting requirements, such as:

Requirement	Frequency	Details
Income Tax Withholding	Monthly	Employers remit withheld taxes to the tax authorities.
Social Security Contributions	Monthly	Contributions must be remitted to the relevant social insurance funds.
Payroll Recordkeeping	Ongoing	Payroll records must be kept for at least 10 years.

Outcome: Staying on top of payroll compliance minimizes legal risks and ensures smooth operations.

Key Documents for Payroll in Greece 📋

Here’s a list of essential documents needed for payroll management in Greece:

Document	Purpose
Tax Withholding Forms	Ensures accurate income tax reporting.
Employment Contracts	Details salary, benefits, and other employment terms.
Social Security Registration	Registers employees for social security contributions.
Payroll Records	Maintains detailed records of employee payments and deductions.

Payroll Processing Deadlines and Penalties in Greece 📅

Timely payroll processing is crucial to avoid penalties and maintain compliance.

Payroll Processing Deadline	Remittance Deadline	Penalty
Payroll	End of each month	Late payments may incur fines.
Income Tax	20th of the following month	Delays may result in penalties.
Social Security Contributions	Last day of the following month	Delayed contributions incur fines.

Outcome: Timely payroll processing helps avoid penalties and ensures compliance with Greek payroll regulations.

Key Takeaways:

A structured and compliant salary system helps meet Greek payroll standards and attract talent.
Employers must withhold income tax based on Greek progressive tax rates and remit it timely.
Social security contributions, covering health, pensions, and unemployment, are mandatory.
Properly managing paid leave and public holidays is essential for employee satisfaction and legal compliance.
Foreign employees are generally subject to Greek payroll and social security obligations unless an exemption applies.