Greece: Tax provisions for investment funds and fund managers under new law

Recently enacted Law 5313/2026 clarifies the tax framework applicable to alternative investment funds (AIFs) and alternative investment fund managers (AIFMs) established in Greece and introduces incentives to attract highly specialized investment management professionals.

The key developments under the new law include:

• Tax neutrality of EU and third-country investment funds: The law clarifies that the tax regime applicable to Greek AIFs and their unitholders is aligned with that of close-ended mutual funds (AKES). Under these rules, either the Greek AIF itself is subject to tax (at a rate equal to 5% of the European Central Bank (ECB) interest rate for main refinancing operations, calculated annually on the difference between the value of the AKES participations as of December 31 of each tax year and their acquisition cost increased by the cumulative operational costs) or the AIF is tax-transparent, with taxation occurring at the level of its unitholders.
• Exemptions for EU and third-country funds: Funds established in EU member states (EU AIFs) are not subject to tax in Greece. Additionally, beginning January 1, 2026, funds established in third countries will not be subject to tax in Greece, provided that their registered seat is not located in a non-cooperative jurisdiction and they are supervised by the International Organization of Securities Commissions (IOSCO).
• Effective management and permanent establishment clarifications: Effective January 1, 2026, the management, delegation of management, or portfolio management of EU AIFs and qualifying third-country funds does not constitute the exercise of effective management that could result in the funds, or underlying companies in which they invest, acquiring tax residence in Greece. Furthermore, the provision of portfolio management and consulting services by Greek legal entities to EU AIF managers and third-country fund managers, in the ordinary course of business, does not in itself create a permanent establishment in Greece for those managers.
• Taxation of carried interest: Carried interest received by employees of Greek legal entities providing services to EU AIF managers or third-country fund managers is taxed as capital gains at a rate of 15%, subject to relevant supervision conditions.
• Incentives for relocating professionals: Individuals who transfer their tax residence to Greece under Article 5C of the Income Tax Code to work for Greek legal entities that provide services to managers of EU or third-country investment funds qualify for a reduced 5% tax rate on carried interest. This incentive applies when the employing Greek legal entity incurs annual expenses in Greece of at least €3 million.

Read a July 2026 report prepared by the KPMG member firm in Greece