Setting up an IKE (LTD ) in Greece: a flexible and tax-efficient option for foreign companies
For many foreign companies seeking to establish a business presence in Greece, the Private Capital Company (IKE) is often the most practical and flexible option. An IKE has separate legal personality and, as a rule, limited liability at company level. It may be established by one or more persons, including as a single-member company. For international use, Greek law expressly allows its name to be rendered as “Private Company” or “P.C.”, making it broadly comparable to the private limited company structures used in many European jurisdictions.
What is an IKE and why is it familiar to international investors
The IKE is the modern Greek company form widely used by SMEs and growth-oriented businesses. For foreign investors, it can be described as the Greek equivalent of a flexible private limited company: it has a clear corporate structure, separate legal personality and allows participation by both individuals and legal entities. It is also flexible in terms of shareholder contributions, since Greek law recognises capital, non-capital and guarantee contributions
Why foreign companies often choose an IKE when entering the Greek market
One of the key advantages is that an IKE may be incorporated through Greece’s digital One Stop Service (e-YMS). The official process is electronic, while starting a business in Greece generally requires an active Greek Tax Identification Number (AFM/TIN) and access to TAXIS. Where the founder is a foreign legal entity, the incorporation package will usually include foreign corporate documents, a board or shareholder resolution approving the investment and the appointment of a representative, together with the relevant legalization and translation requirements where applicable. This makes the IKE particularly suitable for foreign groups that want to establish a separate Greek subsidiary with a distinct legal and tax identity.
The main tax advantages of an IKE in Greece
From a tax perspective, the IKE offers a clear and often attractive framework for international structures. Greece’s current Corporate Income Tax rate is 22%, while dividends are generally taxed at 5% under domestic rules. For foreign parent companies, this usually means taxation first at the level of the Greek company and then a relatively moderate tax burden upon distribution. In addition, where a Double Tax Treaty applies, the overall tax cost may be reduced or credited in the shareholder’s home jurisdiction. In certain intra-group situations, Article 63 of the Greek Income Tax Code may even allow withholding tax exemption on dividends, subject to conditions such as a minimum 10% participation and a 24-month holding period.Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis, pulvinar dapibus leo.
What foreign companies should consider before incorporating an IKE in Greece
Choosing an IKE is not only about tax rates. The company must keep proper accounting books, manage VAT obligations where applicable, with the standard rate currently at 24%, transmit the required data through myDATA, prepare financial statements and comply with the registration of beneficial owners. For that reason, an IKE works best when it is supported from day one by proper legal, tax and accounting planning.
