The income tax brackets for 2025 remain largely unchanged from 2024, but there are important details that every employee should know. In this comprehensive guide, we’ll see how progressive brackets work and how they affect your net salary.
New Tax Brackets 2025
Greece’s tax system is based on progressive brackets, which means that as your income increases, so does the tax rate.
2025 Tax Brackets Table
| Income (€) | Tax Rate | Maximum Tax per Bracket |
|---|---|---|
| 0 - 10,000 | 9% | €900 |
| 10,001 - 20,000 | 22% | €2,200 |
| 20,001 - 30,000 | 28% | €2,800 |
| 30,001 - 40,000 | 36% | €3,600 |
| 40,001+ | 44% | No limit |
How Progressive Brackets Work
Important: You don’t pay the highest rate on all your income!
Example: If you have an income of €25,000:
- First €10,000: 9% = €900
- Next €10,000: 22% = €2,200
- Last €5,000: 28% = €1,400
- Total tax: €4,500 (18% of total)
Tax Credits 2025
Tax credits are deducted from the tax owed, not from income, and significantly reduce your tax liability.
Basic Credit Amounts
- 0 children: €777 annually
- 1 child: €810 annually
- 2 children: €1,120 annually
Credit Reduction
The credit is reduced by €20 for every €1,000 of income above €12,000.
Formula:
Final Credit = Basic Credit - max(0, (Income - 12,000) / 1,000 × 20)Tax Credit Examples
Income €18,000 - 1 child:
- Basic credit: €810
- Reduction: (18,000 - 12,000) / 1,000 × 20 = €120
- Final credit: €690
Practical Calculation Examples
Example 1: Salary €1,500 monthly
Annual income: €1,500 × 14 = €21,000 (with 14 salaries)
Tax calculation:
- €10,000 × 9% = €900
- €10,000 × 22% = €2,200
- €1,000 × 28% = €280
- Total tax: €3,380
Tax credit (0 children):
- Basic: €777
- Reduction: (21,000 - 12,000) / 1,000 × 20 = €180
- Final credit: €597
Final tax: €3,380 - €597 = €2,783
Monthly tax: €2,783 / 14 = €199
Example 2: Salary €2,500 monthly
Annual income: €2,500 × 14 = €35,000
Tax calculation:
- €10,000 × 9% = €900
- €10,000 × 22% = €2,200
- €10,000 × 28% = €2,800
- €5,000 × 36% = €1,800
- Total tax: €7,700
Tax credit (0 children):
- Basic: €777
- Reduction: (35,000 - 12,000) / 1,000 × 20 = €460
- Final credit: €317
Final tax: €7,700 - €317 = €7,383
Monthly tax: €7,383 / 14 = €527
Special Tax Regimes
Reduced Tax Rate (Article 5G)
New residents in Greece can benefit from a 50% reduction in income tax for the first 7 years, provided they meet specific conditions:
- Permanent residence establishment in Greece
- Did not have tax residence in Greece for 5 of the last 6 years
- Minimum stay of 2 years
Self-Employed and Business Income
Different rules apply for:
- Self-employed (freelancers): Standard tax brackets with business expense deductions
- Sole proprietorships: Separate calculation with deemed income rules
- Corporations: 22% corporate tax rate
Practical Tax Saving Tips
1. Maximize Deductions
- Health expenses (up to €3,000)
- Education expenses (up to €800)
- Life insurance premiums (up to €500)
- Charitable donations (up to 5% of income)
2. Family Planning
Having children significantly increases your tax credit:
- 1 child: +€33 annually
- 2 children: +€343 annually
- 3+ children: Even higher benefits
3. Split Income with Spouse
If your spouse has lower income, consider income splitting strategies where legally possible.
4. Timing of Income
For variable income (bonuses, overtime), timing can affect which tax bracket applies.
Social Security Contributions
Remember that income tax is calculated after social security deductions:
- Employee EFKA: 13.37% of gross salary
- Employer EFKA: 24.06% (not deducted from employee)
- Maximum ceiling: €7,572.62 monthly (2025)
Using Our Calculators
Want to see these calculations in practice? Use our free tools:
- Gross to Net Calculator - Calculate your net salary
- Net to Gross Calculator - Find required gross salary
- Employee vs B2B Comparison - Compare employment options
Key Takeaways
- Progressive system: Higher income = higher marginal tax rate
- Tax credits matter: Can significantly reduce your final tax bill
- Social security first: Tax calculated after EFKA deductions
- Special regimes available: Reduced rates for new residents
- Deductions help: Maximize allowable expense deductions
The Greek tax system may seem complex, but understanding these brackets helps you make informed financial decisions. Always consult with a tax professional for personalized advice, especially for complex situations involving multiple income sources or business activities.
Last updated: January 2025. Tax laws may change during the year. Always verify with official sources or tax professionals.