A sole proprietorship uses the individual’s AFM. Digital registration can often be free, but correct setup and recurring obligations matter more than the filing itself.
1. What is a sole proprietorship?
It is an individual business under the same AFM, without separate legal personality, mandatory capital or articles. It is simple, but personal and business liability are not fully separated. Compare it with a P.C.C..
2. What should be decided first?
Activity, premises, B2B/B2C customers, foreign customers, staff, licences, POS, investments, VAT and whether Blockaki tax treatment may apply.
3. Choosing KAD codes
Main and secondary Greek activity codes must describe the real activity and can affect licences, POS and grants. The KAD 2025 classification applies from 1 March 2026.
4. Can the home be the address?
Yes where there is lawful use and the activity is compatible. Shops, workshops and regulated premises require separate review.
5. Licence or notification
A KAD is not itself an operating licence. Professional permission, notification, health or technical conditions and OpenBusiness may apply.
6. Registration process
Eligible cases use gov.gr. Others use myAADE My Requests and form D211 where required. Registration must precede transactions.
7. Required information
AFM, TAXISnet, identity, address evidence, ATAK where needed, lease or free-use declaration, KAD, VAT regime, books, trade name, licences and authorisation.
8. GEMI
Not every freelancer must register. The obligation depends on the nature of the activity. Where a sole proprietorship is required to register, the annual GEMI fee is €30 for a full year and is calculated proportionately for a shorter operating period.
9. e-EFKA
Registration or re-registration as a non-salaried insured person and the selected category must be reviewed after commencement. Final 2026 monthly amounts are: special €160.46; categories 1–6: €260.77, €310.93, €370.63, €443.47, €529.45 and €685.87. Each amount is allocated between main pension, healthcare and the unemployment contribution. New tax registration does not automatically confer entitlement to the special category.
Concurrent salaried employment does not generally mean that no e-EFKA is due. Salaried contributions are taken into account under the parallel-insurance rules and the final position must be checked individually.
10. VAT regime
Under the standard regime, the business charges the applicable VAT, files periodic returns and may recover eligible input VAT. The general rate is 24%, with reduced rates for specified goods and services. Under the Article 39 small-business exemption, a new business or an eligible business with relevant prior-year supplies up to €10,000 does not charge VAT or file periodic VAT returns, but cannot recover purchase VAT and must use the prescribed exemption wording. If the threshold is exceeded during the year, the standard regime applies from the transaction that caused the excess.
11. VAT filing frequency
A new standard-regime business with single-entry books may be required to file monthly VAT returns during its first two years, depending on its commencement date and AADE’s applicable timetable. Lawfully exempt activities without periodic returns are outside this obligation.
12. Documents and myDATA
Issue invoices to businesses and retail documents to individuals as appropriate. AADE timologio, myDATAapp or commercial software can transmit data.
13. Mandatory e-invoicing
For remaining businesses the second phase begins 1 October 2026, with conditional gradual compliance through 31 December 2026.
14. POS, IRIS and account
Duties depend on KAD and B2B/B2C activity. Relevant B2C instant-payment acceptance has applied since 1 December 2025.
15. Cash payments
A tax document issued to a consumer for €500 or more must be paid by card or another permitted electronic means rather than cash. Separately, a business expense above €500 generally requires payment through a banking instrument to qualify for tax deduction.
16. Foreign transactions
EU/third-country, goods/services and B2B/B2C cases differ. Before the first intra-EU invoice, check VIES registration, the customer’s VAT number, place-of-supply rules and the correct VAT wording. Where required, VIES recapitulative statements are filed by the 26th day of the following month.
17. Deductible expenses
An expense must serve the business, represent a genuine transaction, be recorded with appropriate evidence and not fall within the non-deductible items of Article 23. Expenses above €500 also require the appropriate banking payment. Equipment and depreciation, software, subscriptions, premises, telecommunications, accounting, marketing, bank charges, business travel and paid social-security contributions may qualify; mixed-use expenses require a documented business allocation. An invoice alone is not sufficient.
18. 2026 taxation
For a taxpayer over 30 without dependent children: 9% to €10,000; 20% to €20,000; 26% to €30,000; 34% to €40,000; 39% to €60,000; 44% above. Age and children can change the calculation.
19. Tax example
€30,000 turnover less €8,000 costs gives €22,000 profit. Basic tax is €900 + €2,000 + €520 = €3,420, before personal factors and other adjustments.
20. Advance tax
It is credited against the next year. 55% of €3,420 is €1,881; the first-business-income reduction may halve this to €940.50.
21. Business levy
It no longer applies to individuals carrying on business. Older €650 references are outdated.
22. Minimum deemed income
It does not apply for the first three years from the first-ever start; it is reduced by two thirds in year four and one third in year five.
23. New-business reliefs
Subject to conditions: 50% reduction of the first rate for three years with gross revenue up to €10,000, reduced first advance tax, deemed-income relief, special insurance category and VAT exemption.
24. 20% withholding
It applies only to specified technical, management, consultancy and similar fees paid to individuals when the net transaction value exceeds €300 and the legal conditions are met. On €1,000 plus €240 VAT less €200 withholding, €1,040 is paid and the €200 is credited in the annual assessment.
25. Real operating cost
Digital registration can cost €0 and no capital is required. For an obligated sole proprietorship, GEMI is €30 per full year. The 2026 e-EFKA special category is €160.46 per month where eligible and the first regular category is €260.77. Accounting, invoicing, banking and licensing depend on the activity.
26. Freelancer example
A home-based consultant expecting €30,000 turnover should settle KAD, address, VAT and licences before starting, then organise e-EFKA, invoicing, myDATA, VAT, banking and tax forecasting.
27. Hiring staff
Employer registration, ERGANI, payroll, APD, labour rules, digital work card and occupational safety may apply.
28. Ongoing obligations
Periodically: e-EFKA, VAT, VIES, withholding and payroll. During the year: documents, myDATA, expenses and registry changes. Annually: return, E3, tax, category choice and GEMI where required.
29. Common mistakes
Wrong KAD or VAT, transactions before registration, forgotten VIES/e-EFKA, poor invoicing, delayed myDATA, confusing turnover with profit and ignoring licences or payment duties.
30. Before the first invoice
Confirm KAD, address, licences, VAT, e-EFKA, invoicing, myDATA, POS/IRIS, professional account, VIES, expense process and tax reserve.
Conclusion
The process is relatively simple; correct KAD, VAT, insurance, VIES and document organisation from day one prevent avoidable problems.
Frequently asked questions
Cost to start?
The digital process may have no state fee; operating costs depend on the activity.
Capital required?
No.
Home address?
Often yes, with lawful use and suitable activity.
Can I register myself?
Yes in eligible gov.gr cases.
Need an accountant?
Ongoing books, returns and myDATA make support important.
e-EFKA immediately?
It depends on insurance status.
VAT exemption?
Potentially, if conditions are met.
VAT frequency?
It depends; monthly filing may apply.
Business levy?
Not for an individual business.
Deemed income from year one?
No, not in the first three years from the first start.
Need POS?
It depends on KAD and B2C activity.
Need IRIS?
For relevant B2C activity.
Professional account?
It depends on payment duties.
Invoice abroad?
Yes, after VAT/VIES checks.
What is VIES?
The EU VAT validation and reporting system.
Is timologio enough?
For many small activities, yes.
Deductible expenses?
Genuine, documented business expenses meeting tax rules.
Advance tax?
A prepayment credited next year.
20% withholding?
Only for specified fees and conditions.
Already employed?
Parallel insurance and total tax must be reviewed.
Thinking of starting a sole proprietorship?
KAD, address, VAT, e-EFKA and invoicing should be correct from day one.
Request guidance for your start-up