Accounting supportfor freelancers.

How Is a Freelancer Taxed in 2026?

A freelancer’s tax is not calculated directly on turnover.

The starting point is the taxable profit arising from the business activity, taking into account revenue and tax-deductible expenses.

From tax year 2026, the basic tax scale for income from business activity, before the special variations that may apply depending on age and dependent children, is:

The final tax position does not depend only on this scale.

The Minimum Deemed Income, any advance tax, taxes withheld, other income and the special rules applying to the particular taxpayer must also be examined.

A meaningful estimate of the tax burden must therefore be based on the actual circumstances of each freelancer.

Turnover, Profit & Taxable Income

Turnover shows how much revenue an activity generated. On its own, however, it does not show how much the freelancer ultimately earned.

For example, annual turnover of €70,000 does not mean that the freelancer has, or is automatically taxed on, €70,000 of net income.

If tax-deductible business expenses are €30,000, the accounting result before other tax adjustments is €40,000.

Revenue
– deductible expenses
= accounting result

The remaining tax rules that may affect final taxable income are then examined.

For a freelancer, monitoring profit rather than turnover alone is therefore far more useful.

Minimum Deemed Income

Sole proprietorships are subject to a Minimum Deemed Income assessment system under Articles 28A to 28D of the Income Tax Code.

This means that, in certain cases, the tax base may not be limited solely to the net accounting result reported by the activity.

The calculation must reflect the actual circumstances of each business, including:

• the years since the activity first commenced
• payroll expenditure, where employees are engaged
• the factors specified by law for the particular activity
• the available reductions or exemptions
• income that may affect the calculation
• special social or professional circumstances
• the possibility of challenging the amount when the statutory conditions are met

It is particularly important to review the Minimum Deemed Income before the tax year closes.

This allows the freelancer to identify in good time any material difference between actual profit and the tax base that may arise under the applicable framework.

Which Business Expenses Are Deductible?

A purchase does not become a tax-deductible expense merely because an invoice was issued to the business’s tax number.

The expense must meet the requirements of Articles 22 and 23 of the Income Tax Code and be genuinely connected with the business activity.

Depending on the profession, the following may be examined, among others:

• rent for the business premises
• electricity, telephone and internet
• software and professional subscriptions
• professional equipment
• computers and peripherals
• advertising and marketing
• fees paid to accountants, lawyers and other partners
• professional insurance
• travel connected with the activity
• payroll and employer contributions
• professional training, where the relevant conditions are met

For each expense, its genuine business use, proper documentation, payment method where required and accounting entry must be reviewed.

Personal expenses do not become business expenses simply because an invoice is issued to the business.

Working from Home

Using a home as the registered business address does not mean that all household expenses automatically become business expenses.

The review should consider the declared address, the part of the home genuinely used for work, ownership or lease terms, utility bills, telephone and internet, evidence of professional use and a reasonable allocation of shared costs where it can be supported.

The objective is not to record household costs mechanically, but to recognise the portion genuinely connected with the activity.

Car, Fixed Assets & Professional Equipment

Cars, computers and other equipment require different treatment according to their nature and use. For a car, income-tax recognition must be distinguished from the right to deduct VAT.

Depending on the case, purchase and depreciation, leasing, fuel, maintenance, insurance and other operating costs may need to be reviewed. Recognition for income-tax purposes does not automatically mean the related VAT is recoverable.

Higher-value equipment may need to be recorded as a fixed asset and depreciated rather than deducted fully in the year of purchase.

VAT: What a Freelancer Should Know

VAT treatment depends on the type of activity, the services or goods supplied, any exemptions or special schemes and the place of supply.

A VAT-registered activity must distinguish the net value of a transaction from VAT collected on behalf of the State. That VAT is not business profit.

Monitoring should show output VAT, deductible input VAT where allowed, the amount payable and upcoming deadlines. This prevents the mistaken assumption that the entire bank balance is free liquidity.

Withholding Tax & “Blockaki”

Not every service invoice is automatically subject to 20% withholding tax. Withholding depends on the type of fee, the recipient and the conditions in Articles 62 and 64 of the Income Tax Code. The 20% rate concerns specific categories such as technical, management and consultancy services when the legal conditions are met.

Tax withheld is credited in the final tax settlement; it is not necessarily a final loss.

The special tax treatment commonly known as “blockaki” is a separate issue. Having one or two customers is not enough by itself—all cumulative statutory conditions must be checked.

EFKA & the Total Tax Burden

A self-employed person’s financial burden is not limited to income tax. Annual planning should separately consider income tax, advance tax, EFKA contributions, VAT where applicable, withholding tax and other professional obligations.

Two freelancers with the same accounting profit may face different total burdens. The useful question is therefore not only “How much income tax will I pay?” but “What total amount of obligations must my activity finance during the year?”

myDATA & Mandatory Electronic Invoicing

Invoicing, myDATA and accounting monitoring should no longer operate as three separate processes.

Document issue<br>→ transmission<br>→ myDATA<br>→ accounting monitoring

The second phase of mandatory electronic invoicing begins on 1 October 2026, with a transition period to 31 December 2026 where timely actions have been completed and the relevant conditions are met.

The right solution should reflect document volume, customer type, automation needs and cooperation with the accountant—not only software price.

Foreign Customers & Suppliers

Transactions with customers or suppliers outside Greece should not be handled mechanically as domestic transactions.

Each case requires review of whether it is B2B or B2C, the country involved, EU or non-EU status, place-of-supply rules, VAT treatment, VIES obligations, recapitulative statements, possible reverse charge and correct myDATA reporting.

Purchases of software, hosting, online advertising, SaaS and other digital services from foreign companies can also create obligations different from an ordinary Greek purchase.

Business Account, POS, IRIS & Collections

Good financial organisation requires a clear trail for every receipt:

Document<br>→ actual collection<br>→ bank / POS / IRIS<br>→ accounting entry

Mixing business and personal transactions in the same account makes the activity harder to understand. Regular reconciliation helps identify unpaid invoices, discrepancies, overdue receivables, true bank liquidity and amounts reserved for tax or other obligations.

The bank account should not function as the freelancer’s only “accounting system”.

Profit, Cash Flow & Personal Withdrawals

Profit and available cash are not the same thing.

An activity may report an accounting profit while facing low liquidity because:

• customers have not paid
• investments have been made
• older liabilities have been settled
• VAT has been remitted
• taxes and social-security contributions have been paid
• cash has been used for personal needs

Personal withdrawals by the owner of a sole proprietorship must not be confused with the business’s operating expenses.

If, for example, the activity generates an average monthly available return of €4,000 but the freelancer consistently withdraws €5,500, a liquidity problem will arise sooner or later.

The activity must therefore finance both the freelancer’s personal needs and its own operation and obligations.

Tax Planning before Year-end

Tax should not come as a surprise when the return is filed. Before year-end, an estimate should consider realised revenue, recorded expenses, expected annual profit, minimum deemed income, the applicable tax scale, advance tax, tax already withheld and social-security and other obligations.

This allows the freelancer to anticipate the burden and retain sufficient liquidity. Proper tax planning does not mean buying unnecessary expenses at year-end; it means understanding the results and making lawful, data-based business decisions.

Sole Proprietorship or P.C.C.?

There is no “magic turnover” above which an P.C.C. automatically becomes better than a sole proprietorship. The decision must compare actual data.

The analysis should include net profit, minimum deemed income, personal and corporate taxation, dividend taxation, social-security obligations, manager remuneration, the owner’s personal cash needs, reinvestment, company administration costs, partners, liability and growth plans.

Two freelancers with the same turnover can reach completely different conclusions. Profit, use of profits and the overall financial model matter more than turnover alone.

Pricing, Break-even & Financial Monitoring

Financial organisation should not stop at tax compliance. A freelancer should be able to answer three questions: What does it really cost me to operate? What must I charge to be profitable? Which customers or services create real value?

Pricing should cover working time, EFKA, software, marketing, operating costs, administrative and unbilled time, partners, expected taxes and the desired business profit.

Break-even shows the revenue needed to cover obligations and costs. Even a small individual business can monitor monthly turnover, expenses, net result, receivables, liabilities, VAT, withholding tax, EFKA, estimated tax, cash flow and break-even.