US Company Formation from Greece (2026): The 1950 Treaty's 30% Dividend Problem, Greek CFC Rules for Individuals, Presumptive Freelancer Income, Article 5C and the US LLC vs C-Corp Choice

Greece and the USA signed one of America's oldest income tax treaties, in 1950. It still applies, and it has a peculiarity that shapes every Greek decision about a US company: it does not reduce US withholding on dividends, which stays at 30%, but it does exempt interest and royalties. Meanwhile, Greece's own rules make US companies trickier for individuals: Greek CFC rules apply to individuals, they are stricter for companies outside the EU, and self-employed Greeks now pay tax on a presumptive minimum income.

On the other side, Greece offers some of Europe's most generous regimes for people who move there: a 50% income tax reduction for seven years for new residents who work in Greece (Article 5C), and a €100,000 flat tax on foreign income for wealthy new residents (Article 5A). This guide covers all of these, and compares US LLC formation with US C-Corp formation for Greek freelancers, start-ups, exporters and new residents. It goes further than our Greece, Cyprus and Malta overview.

In short: Greeks and Greek residents can own 100% of a US LLC or C-Corporation, formed remotely. The 1950 US–Greece treaty leaves US dividends at 30% but exempts interest and royalties from US withholding. Greece taxes companies at 22% and dividends at 5%. Greek CFC rules (Article 66) can tax a Greek individual on the income of a controlled low-taxed foreign company, and for companies outside the EU the substance exception does not apply. A US company managed from Greece can be Greek-resident. New residents can use Article 5C (50% off income tax for 7 years) or 5A (€100,000 flat tax on foreign income). With UCB, a Wyoming LLC with EIN is $249 and a Delaware corporation with EIN is $358, all-in.

The 1950 treaty: dividends no, interest and royalties yes

That makes the payment channel from a US company to Greece unusually important:

• Dividends from a US corporation to a Greek owner, individual or company, lose 30% in the USA. Greece taxes dividends at 5% and gives a credit for foreign tax up to the Greek tax, so the excess US tax is simply lost.
• Royalties for IP licensed from Greece, and interest on loans from Greece, can be paid without US withholding if the treaty claim is made on Form W-8BEN or W-8BEN-E (see W-8BEN-E vs W-8BEN explained).
• Business profits of a Greek resident are taxable in the USA only through a US permanent establishment.

The treaty predates modern limitation-on-benefits articles. A newer treaty has been discussed for years but has not been concluded.

Greek rules that affect a US company

Rates

• Corporate income tax: 22%.
• Dividends: 5% withholding for individuals.
• Personal income tax: progressive up to 44% on business and employment income.
• Self-employed: since 2024, freelancers and sole traders are taxed on at least a presumptive minimum income (τεκμαρτό εισόδημα), based on the minimum wage and adjusted for years in business and other factors, unless they rebut it.

CFC rules (Article 66)

Greek CFC rules apply to Greek tax resident individuals and companies that control a foreign entity:

• whose actual tax is less than half the Greek tax that would apply; and
• whose income is mainly of certain passive types (interest, royalties, dividends, financial leasing, insurance and banking income, and income of "invoicing" companies that add little value to transactions with related parties).

For entities in the EU or EEA, a substantial economic activity exception protects genuine businesses. For entities in third countries such as the USA, that exception does not apply. So a Greek individual's US LLC that pays no US tax and earns, for example, royalties or income from re-invoicing related-party services can be taxed in Greece as the income arises.

Residence of a foreign company

A foreign company whose place of effective management is in Greece is Greek-resident and pays 22% on its worldwide profits. A single-member LLC run by its owner from Thessaloniki is managed from Greece.

Regimes for new residents

• Article 5C: individuals who move their tax residence to Greece and work there as employees or self-employed get a 50% reduction in income tax on that income for 7 years. A US company is not needed; the relief applies to Greek-taxed work income.
• Article 5A: individuals who move to Greece and invest at least €500,000 can pay a flat €100,000 a year on all foreign-source income, for up to 15 years. A founder with income from a US company that is genuinely foreign-source can benefit.
• Article 5B: foreign pensioners pay 7% on foreign income for 15 years.
• Digital nomad visa: remote workers for foreign employers or clients can live in Greece; after 183 days they generally become Greek tax residents.

New residents should model their US company income under the regime they choose. Income from work done in Greece is Greek-source, whichever company invoices it, and does not become "foreign income" because a US LLC is involved.

US LLC formation from Greece

US tax position

A single-member LLC with a non-resident owner pays no US income tax if the owner works from Greece and the LLC has no US office, employees or dependent agents (see effectively connected income explained). Its distributions are not dividends, so the 30% never applies. The LLC files Form 5472 with a pro forma Form 1120 every year, and the penalty for missing it is $25,000 (see Form 5472 explained).

The Greek side

Greece generally treats a US LLC with limited liability as a foreign legal entity. For a Greek resident owner, the likely results are:

• managed from Greece: a Greek-resident company at 22%, then 5% on dividends;
• otherwise: distributions taxed as dividends, with CFC risk if the income is of the passive types.

Example: a developer in Athens

These are illustrative figures, not a client case, at €0.92 to the dollar.

Nikos is a developer in Athens with US$60,000 (about €55,000) a year from US clients. As a freelancer, he is taxed on his actual profit or the presumptive minimum, whichever is higher, at progressive rates. A US LLC run from Athens would most likely be a Greek-resident company paying 22%, with 5% on dividends, which could be cheaper than personal rates at his income, but a Greek IKE (private company) gives the same rates with less risk and no US compliance. He forms an IKE. Two US clients want a US vendor, so the IKE owns a small Wyoming LLC that invoices them and pays the IKE for the work.

US C-Corp formation from Greece

US tax position

A US corporation pays 21% federal tax on its profits plus state tax, and files Form 1120 and Form 5472 every year (see the 21% corporate tax explained and the C-Corp guide for non-residents). A C-Corporation paying US tax is unlikely to be low-taxed for Greek CFC purposes. Its dividends to Greece are withheld at 30%.

Structuring around the 30%

Because the treaty exempts royalties and interest but not dividends, Greek groups with US subsidiaries often:

• license IP from the Greek company to the US subsidiary, paying royalties free of US withholding (at arm's length, and subject to US anti-base-erosion rules for large groups);
• lend to the US subsidiary, with interest free of US withholding, within US interest deduction limits;
• reinvest US profits rather than paying dividends.

Example: a Greek olive oil and food exporter

Take an illustrative case: a Kalamata olive oil producer sells to US distributors and wants its own US importer with a warehouse in New Jersey. It forms a Delaware corporation registered in New Jersey. The US company buys oil from the Greek company at arm's-length prices, sells to retailers and pays US tax on its margin. It does not pay dividends, which would lose 30%. Instead, it pays the Greek company a royalty for the brand, documented by a transfer-pricing study, which carries no US withholding. See US subsidiary for a foreign company.

Start-ups

Greek start-ups raising from US investors usually need a Delaware C-Corporation at the top, with the Greek IKE or AE as a subsidiary. Dividends are rarely paid in a growing start-up, so the 30% matters less. See raising US investment as a foreign founder.

Which state

• Delaware for a start-up or subsidiary.
• New Jersey, New York or Illinois for food importers with warehouses there.
• Wyoming or New Mexico for a small LLC owned by an IKE.

See best state for non-residents and the state selector.

What it costs

UCB's prices include state fees and the first year of registered agent service:

• Wyoming LLC with EIN: $249, or $348 with a US bank account application.
• Delaware corporation with EIN: $358.

A Wyoming LLC costs $121 a year to keep active, or $421 with the annual federal return. A Delaware corporation costs $578 a year. A US business address with your own suite number is $60 a year. See what a US LLC costs every year.

Documents and banking

For an individual, your Greek passport and proof of address. Use the Latin spelling in your passport on every document. For an IKE or AE, a GEMI certificate in English and a decision approving the US company. US fintech banks accept Greek owners readily. See US business bank accounts for non-residents and Stripe for non-residents.

Mistakes to avoid

• Paying dividends from a US corporation to Greece at 30%.
• Not claiming the treaty's 0% on royalties and interest.
• Holding royalties or passive income in a US LLC within reach of Article 66.
• Assuming Greek work income becomes foreign income under Article 5A because a US LLC invoices it.
• Missing Form 5472 in a year when no US tax was due.

Frequently asked questions

Does the US–Greece treaty reduce US dividend withholding? No. The 1950 treaty leaves dividends at 30%. It does exempt interest and royalties.

Do Greek CFC rules apply to individuals? Yes. Article 66 applies to individuals and companies, and for non-EU companies such as US ones, the substantial activity exception does not apply.

How does Greece treat a US LLC? Generally as a foreign legal entity. An LLC managed from Greece can be Greek-resident at 22%.

Can new residents benefit from a US company? Article 5A's flat tax covers genuinely foreign income. Income from work done in Greece remains Greek income whatever company invoices it.

Does my US LLC pay US tax? Not if it has no US office, staff or agents. It files Form 5472 and a pro forma 1120 every year.

How UCB can help

We form US companies for Greek owners and companies remotely: the state filing, EIN, registered agent, US business address and bank application. We prepare W-8BEN-E treaty forms for royalties and interest, and each year we file the US returns through our US tax filing service. See our formation, EIN and bank account package, and the Cyprus guide.

Setting up a US company from Greece? WhatsApp us at +1 315 961 2956 or email enquiries@ucbsolutions.com.