Companies that issue and collect building maintenance fees argue that these payments are made on behalf of third parties, do not count as income, and should not be subject to taxation.
The Greek maintenance fees Business Association has recommended to its members to stop using POS systems for such collections starting January 1, 2025. These companies, which serve 75,000 apartment buildings across Greece, claim a legal gap has led the Independent Authority for Public Revenue (AADE) to equate their collection activities with taxable business income.
Shared expenses companies clarify that their services include calculating expense distributions, preparing and printing monthly expense summaries, and issuing notifications for tenants. They argue that POS usage and taxation should apply only to fees for these services.
According to the association, the responsibility for collecting shared expenses lies legally with the building’s Owners’ Association, which however lacks legal status, a tax ID, a business bank account, or a POS system. Since digital payments are required for tax deductions, a gap emerges in determining who can legally collect shared expenses via POS.
To assist their clients, these companies collect payments from apartment owners or tenants on behalf of the Owners’ Association. However, providing this service has created two challenges:
1. Bank Fees: Transaction fees for POS payments are disproportionately high as they are calculated on the total collected amount, not just the company’s revenue.
2. Tax Audits: Companies face potential audits for sums that do not reflect their actual income, as shared expenses are deposited into operational accounts managed for the Owners’ Associations to cover utility and maintenance costs.
The association stresses that companies merely manage these accounts and are not the owners of the funds. However, they risk scrutiny from tax authorities since POS transactions do not align with declared revenue in VAT filings.
Reports indicate the AADE has sent mass audit requests to local centers targeting shared expense companies, raising concerns within the industry.
The association reiterates that POS collections represent managed funds for apartment buildings, not company revenue. To address this, its board has submitted a detailed memorandum to the AADE explaining that these transactions are not subject to VAT. Until this clarification is recognized, the association recommends that, starting January 1, 2025, its members use POS systems only for services for which they are directly compensated.
