The question “above what turnover does an P.C.C. make sense?” starts from the wrong figure. Two businesses with the same turnover may have entirely different profits, liquidity needs and risk. What matters is the amount left after expenses and how the owner intends to use it.
1. The main differences
| Issue | Sole proprietorship | P.C.C. |
|---|---|---|
| Legal status | The individual carries on the activity | A separate legal entity |
| Taxation | Progressive personal income tax scale | 22% on company profits and 5% on distributed dividends |
| Money | Greater flexibility for personal withdrawals | Company funds are not the owner's personal account |
| Books and administration | Usually simpler operation | Double-entry books and more corporate procedures |
| Liability | Generally personal | Generally limited, subject to important exceptions |
2. How a sole proprietorship is taxed in 2026
Business profits are taxed in the hands of the individual. The basic 2026 scale is 9% up to €10,000, 20% for the next band up to €20,000, 26% up to €30,000, 34% up to €40,000, 39% up to €60,000 and 44% on the excess. Special variations apply depending on age and dependent children, so the actual burden is personal.
The minimum net income rules under Articles 28A–28D of the Greek Income Tax Code must also be considered. Where accounting profit falls below the calculated minimum and no exemption or reduction applies, tax may be assessed on the higher amount.
3. How an P.C.C. is taxed
An P.C.C. is taxed separately as a legal entity at 22% on its taxable profit. If post-tax profits are distributed to its members, dividend withholding tax of 5% applies to the distribution.
If all profit is distributed, the simplified combined burden is 25.9%, because the dividend tax is charged on profit remaining after corporate tax. If some profit stays in the company, dividend tax does not arise on the undistributed amount at that time.
4. Three comparison examples
The examples use the basic 2026 scale without children or other personal reductions. They exclude social security, tax prepayments, management remuneration and differences in accounting costs.
| Annual profit | Sole proprietor tax | P.C.C. with full distribution | Simple difference |
|---|---|---|---|
| €25,000 | €4,200 | €6,475 | Sole proprietor by €2,275 |
| €50,000 | €12,800 | €12,950 | Sole proprietor by €150 |
| €80,000 | €25,500 | €20,720 | P.C.C. by €4,780 |
The figures show a direction, not a final answer. At €50,000 the tax difference is almost zero before the higher operating cost of an P.C.C. is added. At €80,000 the P.C.C. shows a clearer tax advantage, but the remaining factors still have to be considered.
5. What changes when profits are reinvested
Assume an P.C.C. earns €80,000. Corporate tax is €17,600, leaving €62,400. If only €24,000 is distributed, dividend tax is €1,200 and €38,400 remains in the company.
This can matter when funds are needed for staff, equipment, inventory, marketing or working capital. If the owner needs to take almost all annual profit personally, the benefit of retaining profit is reduced.
6. Social security does not automatically disappear
A sole proprietor is insured as a self-employed person where the relevant obligation applies. In an P.C.C., each person's role must be examined. The manager and the sole member of a single-member P.C.C. are not treated in the same way as a passive member of a multi-member P.C.C..
“I will form an P.C.C. and avoid social security” is therefore not a safe general rule.
7. Tax prepayment and real liquidity
Tax prepayment is not a second permanent tax, but it can substantially affect liquidity, particularly in the first year. For individuals with business income it is generally 55% of the tax, while for legal entities it is generally 80%. When an individual earns business income for the first time, the relevant prepayment is reduced by half.
A proper comparison must distinguish the permanent tax burden from the cash amount payable during a particular year.
8. How the owner receives money
Withdrawals from a sole proprietorship do not create a separate profit distribution. In an P.C.C., the money belongs to the company. A transfer to a member must have a valid legal and accounting basis, such as a dividend, management remuneration, salary, loan repayment or another properly documented transaction.
Maintaining a clear separation between personal and corporate funds is one of the most important practical differences.
9. Operating and administrative cost
An P.C.C. normally has higher accounting and administrative costs. It requires double-entry accounting, financial statements, corporate resolutions and General Commercial Registry obligations. A sole proprietorship is generally simpler and less expensive to operate.
A €1,000 tax advantage is not enough if the additional annual administration and accounting cost is greater.
10. Limited liability does not mean absolute protection
An P.C.C. is a separate legal entity and generally limits its members' liability. This does not mean that the manager or members can never face personal exposure. Personal guarantees, management liability for tax or social security debts, unlawful conduct or abusive use of the company can change the position.
Legal protection is a serious consideration, but it should be assessed with a lawyer based on the activity and the company's contracts.
11. When each structure tends to fit
A sole proprietorship may fit better when
- the activity is new or remains relatively simple,
- profits are not especially high,
- the owner needs most of the profit personally,
- there are no partners or major funding needs,
- lower administration is the priority.
An P.C.C. deserves serious consideration when
- profits have increased consistently,
- a substantial part of them is reinvested,
- partners are or will be involved,
- a more organised corporate structure is required,
- the activity carries greater contractual or business risk.
12. Information required before deciding
If you are preparing your first registration, see Starting a Sole Proprietorship in Greece in 2026 .
- Actual profits of recent years, not turnover alone.
- Forecast profit for the coming years.
- The amount the owner needs personally.
- Investment plans and working capital requirements.
- The role of the manager and each member.
- Social security treatment of every person involved.
- Accounting and corporate operating costs.
- Contracts, borrowing and the risk profile of the activity.
Sources and regulatory framework
- AADE — Circular communicating Law 5246/2025
- AADE — Tax prepayment on business income
- AADE — Corporate income tax returns
- e-EFKA — Circulars and official documents
- Law 5246/2025 — Tax reform
Do you need a comparison using your own figures?
The choice of legal structure should reflect your actual profit, withdrawals, social security position, growth plans and the way your business operates.