Legislation
What does the new legislative framework provide for?
According to Article 214 of Law 4512 of 2018 is established “Child Allowance”, which is paid from 1/1/2018 and replaces the Single Child Support Allowance and the Special Allowance for Three Children – Multiple Children. The new allowance is paid taking into account the number of dependent children and the so-called “equivalent family income” according to the standards of the Single Child Support Allowance. Equivalent family income is defined as the total, real or assumed income from each source of domestic and foreign origin before taxes, after deduction of social security contributions, excluding benefits that are not counted in taxable income, of all family members, divided by the so-called equivalence scale. The equivalence scale results from the weighted sum of the family members, as follows:
a) first parent: weighting 1
b) second parent: weighting 1/2 (was 1/3 in previous system)
c) each dependent child: weighting 1/4 (it was 1/6 in the previous system)
One-parent families in particular are more favorably weighted, as the first dependent child is weighted 1/2 and each subsequent dependent child is weighted 1/4.
To determine the beneficiary families, three categories of equivalent family income are defined, as follows:
a) A’ category: up to 6,000 euros,
b) Category B: from 6,001 euros to 10,000 euros,
c) Category C: from 10,001 euros to 15,000 euros.
Examples
- Be a family with an income of €28,000 and two children. The equivalence scale of the family is: 1 + 1/2 +1/4 + 1/4 = 2. Therefore the equivalent income is: €28,000 / 2 = €14,000. So the family belongs to the 3rd income scale from 10,001 euros to 15,000 euros and will receive a 56€ allowance per month.
- Be a family with an income of €14,000 and one child. The family equivalence scale is: 1 + 1/2 +1/4 = 1.75. Therefore the equivalent income is: €14,000 / 1.75 = €8,000. So the family belongs to the B’ income scale from 6,001 euros to 10,000 euros and will receive a 42€ allowance per month.
The amount of the allowance, depending on the number of dependent children and the category of equivalent family income, is determined as follows:
For the 1st category:
- 70 euro per month for the first dependent child
- extra 70 euro per month for the second dependent child
- extra 140 euro per month for the third and each dependent child beyond the third.
For Category B:
- 42 euro per month for the first dependent child
- extra 42 euro per month for the second dependent child
- extra 84 euro per month for the third and each dependent child beyond the third.
For Category C:
- 28 euro per month for the first dependent child
- extra 28 euro per month for the second dependent child
- extra 56 euro per month for the third and each dependent child beyond the third.
Conditions & categories of beneficiaries
The submission of an income tax return each year is a necessary condition for the granting of the allowance. For the calculation of the equivalent family income category, the income reported in the statement of the current financial year is taken into account.
Dependents are defined as children from marriage, natural, adopted or recognized, as long as they are unmarried and do not exceed 18 years of age, or 19 years if they are attending secondary education. Especially for children attending higher or higher education, in the “Post-high school year – Apprenticeship Class” of Vocational High Schools (E.P.L.) as well as Vocational Training Institutes (I.E.K.), the allowance is paid during their studies and in no case after the completion of their 24th year of age. In addition, dependent children are defined as children with a disability rate of 67% or more, as well as the orphan or orphans who form the same family when both parents have died.
In the event of the death of the beneficiary parent or the culpable abandonment of his children and the definitive interruption of cohabitation or divorce, the allowance is paid to whoever has been assigned by a court decision to exercise custody of the children, and in the case of adult children, to whoever has the main responsibility for maintenance. Until a court decision on custody is issued, the allowance is granted to the parent who has the primary responsibility for maintenance, as it appears from a joint declaration of responsibility of the parents.
Child allowance is granted by OPECA upon application and the right is recognised
(a) from January 1 of the year of application submission, for children born until December 31 of the previous year of application submission
(b) from the 1st of the month following that of their birth for children born within the year of submission of the application
(c) from the 1st of January of the following year of their enrollment in a college for students or students.
For the cessation of the allowance, the date of birth of the children is considered to be December 31 of the year of their birth and, in the case of students, the end of the academic or student year.
The child allowance is granted to the following categories of persons if they have resided legally and permanently in the Greek territory for the last 5 years before the year of submission of the application, as this results from the submission of income tax returns of themselves or their spouses or their parents if they themselves were not liable for a tax return and their dependent children are in Greece:
a) Greek citizens residing permanently in Greece,
b) expatriate foreigners who reside permanently in Greece and have an expatriate card,
c) citizens of member states of the European Union who reside permanently in Greece,
d) citizens of the countries belonging to the European Economic Area (Norway, Iceland and Liechtenstein) and Swiss citizens residing permanently in Greece,
e) recognized refugees residing permanently in Greece,
f) stateless,
g) beneficiaries of humanitarian status,
h) citizens of other countries who reside legally and permanently in Greece.
The child allowance is exempt from any tax, fee, levy or withholding in favor of the State or a third party, including the special solidarity levy and is not counted against the total, real or assumed, family income, unless expressly provided for by the legislative framework of social protection financial aids.
Joint Ministerial Decision
With the Joint Ministerial Decision No. G.P.ok.D22/11/2705/58, (Government Gazette B/2018) as applicable, regulates all the details of the procedure for granting the Child Allowance.
The new allowance is granted by OPECA and is paid to beneficiaries every year bimonthly, by credit to an active bank account, on the last working day of the payment month. The amount is calculated based on the data of the last cleared income tax return. After submitting the current year’s tax return or an amendment, the amount of the allowance is recalculated based on income and the number of dependent children. In the event that the beneficiary received a different amount of benefit than what he is entitled to, then this is offset against the amount of subsequent payments.
As defined by the KYA, the A21 application is submitted by the taxpayer from March of each year until January 15 of the following year. The application constitutes a declaration of responsibility, as well as a declaration of consent for the receipt of tax data held in the AADE and cross-checking of the data. The beneficiary must amend the application within one month of any change in his/her family status.
Generally the conditions for granting the allowance are:
(a) electronic submission E1 for submission of income tax return.
(b) completion and electronic submission of A21, through the website of OPECA or IDIKA.
(c) Applicants/obligors must reside legally and permanently in Greece for the last 5 years. The residence check of the beneficiary and his dependent children is made exclusively by the submission of tax returns of the last 5 years of themselves or their spouses or parents, as long as they themselves were not liable for a tax return.
**** Amendments to paragraph 11 of article 214 of Law 4512/2018 and transitional provision with Article 16 of Law 4659/2020
With the provisions of Article 15 of Law 4659 “Birth allowance and other
Provisions” Issue A ́ 21/03.02.2020 the following are provided for:
Article 15
Amendment of Article 214 of Law 4512/2018
1. Paragraph 11 of article 214 of Law 4512/2018 (A ́ 5) is amended as follows:
«11. The child allowance is granted to the following categories of persons if, with the exception of case ́, they have legally and permanently resided in the Greek Territory for the last five (5) years before the year of submission of the application, as this results from the submission of income tax returns of themselves or their spouses or, if they themselves were not liable for a tax return, from the tax return, in which they appear as dependent members and their dependent children are in Greece:
a) Greek citizens residing permanently in Greece,
b) expatriates who reside permanently in Greece and have a Special Identity Card for Expatriates,
c) citizens of member states of the European Union who reside permanently in Greece,
d) citizens of countries belonging to the European Economic Area (and citizens of the Swiss Confederation) who reside permanently in Greece,
e) third-country nationals or stateless persons, who have been granted refugee status or subsidiary protection status, within the meaning of cases f and h of article 2 of Law 4636/2019 (A ́ 169),
f) stateless persons, whose residence status in Greece is governed by the provisions of Law 139/1975 (A ́ 176),
g) citizens of third countries, who have been granted residence status for humanitarian reasons, in accordance with the provisions of article 28 of presidential decree 114/2010 (A ́ 195) in combination with the provisions of article 19A of law 4251/2014 (A ́ 80), as applicable,
h) citizens of other countries who reside legally and permanently in Greece. In this category of citizens, the allowance is granted if they have resided legally and permanently in the Greek Territory for the last twelve (12) years before the year of submission of the application, as this results from the submission of income tax returns of themselves or their spouses or, if they themselves were not liable for a tax return, from the tax return, in which they appear as dependent members and their dependent children are in Greece.
The permanent and legal residence in the country of the above categories of citizens is proven by the submission of an income tax return in each tax year. The submission of an income tax return is understood to mean that which took place during the year, within which the deadline for its submission was set and not any, after the end of the year, within which the above deadline has been set, the submission of an income tax return of a previous tax year”.
2. In paragraph 12 of article 214 of Law 4512/2018, a second paragraph is added as follows:
“This allowance is not confiscated for any debt nor is it set off against confirmed debts to the State, the legal entities under public law, the
Local Government Organizations, the legal entities of the latter and the insurance funds, as well as it is not seized by credit institutions for debts to them nor offset against debts to credit institutions.”
2. Paragraph 17 is added to Article 214 of Law 4512/2018 as follows:
«17. In the case of a dependent child, for whom the conditions for attending compulsory education are met, the allowance is granted on the condition of his enrollment in school, on the one hand, and his actual attendance on the other, which is considered to be met when the dependent child is not required to repeat the same class due to the number of absences. By joint decision of the Ministers of Finance, Labor and Social Affairs, Education and Religious Affairs, every more specific or detailed matter for the application of the previous paragraph, as well as the exceptions from its application, is regulated, especially in cases where the absences of the students are due to reasons related to their health. The regulation of this paragraph shall be applied from the first of the 2020-2021 school year.”
With the provisions of article 16 of Law 4659 “Birth allowance and other Provisions” Issue A ́ 21/03.02.2020 the following are provided for:
Article 16.
Transitional provision Citizens of third countries, who have been granted child benefit until the publication of this law due to their belonging to the category of beneficiaries of case ́ of paragraph 11 of article 214 of Law 4512/2018, as it applied before its amendment, with the regulation of article 15 of this law, continue to receive the child benefit under these conditions, based on which the allowance was granted to them and do not fall within the scope of Article 15.
