Taxation as an Employee (“Blockaki” or Freelancing)

The establishment of a sole proprietorship follows a standard procedure, and as a business entity, it is subject to the same responsibilities and obligations as all other businesses. However, specifically for taxation purposes, an individual may qualify for the “blockaki” (freelancing) tax regime.

In certain cases, therefore, even though business activity is carried out, the income may be taxed as employment income, allowing the individual to benefit from a tax-free threshold.

Conditions for Eligibility under the “Blockaki” Tax Regime

A sole proprietorship may be taxed under the “blockaki” regime, provided that all the following conditions are met:

Services are provided to a company under a contractual agreement, and the number of individual or legal entity clients does not exceed three (3), or 75% of the gross income from business activities is derived from one of these individuals or legal entities.

The individual does not have commercial status.

There is no business establishment separate from the individual's residence (the registered business address is their home).

There is no income from parallel salaried employment.

No transactions are carried out with private individuals (no retail sales, only B2B transactions).

A written cooperation agreement is in place.

When taxation is applied under the “blockaki” regime, business expenses are not deductible. The only expense that may be recorded in the accounting books and reduce taxable income is social security contributions to EFKA (the Greek Social Security Agency).

A major advantage of the “blockaki” tax regime is that no advance income tax payment is imposed.