This circular regulates what each of the three parties is entitled to, but does not regulate the procedure for declaring and collecting compensation, which should be clarified with a newer circular. That is why the platform for submitting COVID declarations should be reopened as soon as possible, especially in view of the submission of tax returns.
Specifically, it expressly states that in the event that the sublessor is entitled to compensation “he must pay the rent in full to the owner even if the sublessor’s activity is part of an affected KAD” .
Finally, it stipulates that if the sublessor is a legal entity, then for 2020 when he was not entitled to compensation, the owner receives it. The sublessor is entitled to a reduced or zero rent if he is affected, and for this the owner should submit a COVID declaration, but this presupposes an open platform of AADE.
- i) Subletting of the whole of a property
Beneficiary for the collection of the compensation of article 13 of Law 4690/2020 is first of all the sublessor, since the sublessee paid a reduced or did not pay monthly rent, as the victim, based on the Activity Code Number (KAD) and the existing legislation, and submitted a “Covid Declaration”.
Since, according to the above, the sublessor benefited from the provisions of article 13 of Law 4690/2020, he cannot also benefit from the provisions of the regulatory acts of the Administration that provide for the payment of reduced rent or the exemption from the payment of rent. (NOTE: Ara must pay the full rent to the lessor-owner in full!).
In the event that the sublessor is affected, paid a reduced rent or did not pay rent to the sublessor and the latter did not submit a “Covid Declaration”, or submitted a “Covid Declaration”, which is rejected because the sublessor is a legal entity (valid for the months March – December 2020), beneficiary for the collection of the compensation of article 13 of Law 4690/2020, is the lessor, under the condition that the sublessor is injured, paid the lessor a reduced rent or did not pay rent and the latter submitted a “Declaration Covid”.
In this particular case, real estate leases/sub-leases that fall indicatively into the following categories are also included:
a) The property is subleased under a franchise agreement from the franchisor to the franchisee.
b) A gaming machine operating company leases property for their installation and by law, he grants the right to exploit them to persons to whom he sublets the property.
EXAMPLE:
In order to understand the above mentioned, the following example is given:
A store is leased by the natural person A (lessor) to the company B (lessee).
Company B (lessee and then sublessor) subleases the same store to company C (sublessee).
The sub-lessee C is, based on the Activity Code Number (KAD), an affected company and therefore pays a reduced sub-rent to the sub-lessee B.
– In the event that sublessor B submitted a “Covid Declaration” and received the benefit provided for in the above provisions for the part of the subrent that she did not collect, she must in any case pay the rent in full to A, even if her activity is included to an affected KAD.
– In the event that sublessor B did not submit a “Covid Declaration”, then, as long as she is affected, she is entitled to pay, reduced rent to A or be exempted from paying it altogether.
In this case, the “Covid Declaration” is submitted by the landlord A, who is also a beneficiary of the benefit of article 13 of Law 4690/2020.
ii) Partial Subletting
In the case of partial subletting, where both the lessee / sublessor and the sublessee are affected, beneficiaries of the support measures for lessors of par. 2 of article 13 of Law 4690/2020, both the lessor and and the sublessor of said property for the percentage of the rent they lost and corresponds to the use of part of the property. In order to pay the relevant amount, both (lessor – sublessor) are required to submit a “Covid Declaration”. a property and the possibility of subletting is provided, which is then exercised by the sublessor, either by selecting the indication partial lease or by completing in the subletting declaration less total square footage than in the leasing declaration, the processing of the covid declarations concerning the above declarations carried out by GDILED.
If the rental information declaration includes more than one property, for which the possibility of subletting is provided which is then exercised by the sublessor for some of the properties or for all of them, the sublessor must submit an amendment statement of real estate lease details for the sublease/subleases, without penalty, to complete the serial numbers of the properties which must be matched with the serial numbers that have the properties in question in the real estate lease information statement related to the initial lease.
For a better understanding of the above, the following example is provided:
EXAMPLE 1
Store of 200 m2 is leased by the natural person A in the company BETA S.A. against 1000 euros per month. The company BETA S.A. subleases to the company GAMMA O.E. the 20 sq. m. of the same property for 300 euros per month. The companies BETA S.A. and GAMMA O.E. are affected for the month of January 2021 and are exempt from paying rent and sub-rent, respectively, as follows:
The company GAMMA O.O. is entitled not to pay sub-rent to the company BETA S.A.. Furthermore, the company BETA S.A. is entitled to collect, based on article 13 of Law 4690/2020, 60% of the rent that was not collected from the company GAMMA O.E. i.e. 180 euros (60% * 300).
The company BETA S.A. which uses 180 of the 200 sq. m. of the property it leases, i.e. 90% of the property, is entitled not to pay the natural person A rent for 90% of the rent (90%*1000 = 900 euros). Also, natural person A is entitled to receive, based on Article 13 of Law 4690/20, 80% of the rent that he did not collect from BETA SA. i.e. an amount of 720 euros (80% * 900 euros).
The above also applies to cases of partial subletting:
a) main residence in which the lessee / sublessee is an employee or spouse or the other party to a cohabitation agreement and whose employment contract has been suspended,
b) student residence of a child – dependent member who attends a higher education institution outside his place of permanent residence, as long as at least one parent is an employee of an affected company and whose employment contract has been suspended,
c ) of the main residence of a seafarer whose seafaring contract is suspended or of a spouse or other party to a cohabitation agreement.
The following example is given for a better understanding of the above:
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EXAMPLE 2
House 100 sq.m. is leased at a rent of 500 euros per month from natural person A to natural person B. Natural person B sublets 20 sq.m. of his house with a sub-rent of 100 euros per month, to natural person C. Natural person B and natural person C are private employees whose employment contract has been temporarily suspended during the month of January 2021, in the context of the measures of the COVID-19 pandemic and are entitled to a reduced payment of the monthly rent and sub-rent, respectively, as follows:
Natural person C is entitled to pay natural person B reduced by 40%, i.e. by 40 euros (100 * 40%) the monthly rent corresponding to 20 sq.m., i.e. an amount of 60 euros (100 – 40 = 60 euros).
Furthermore, natural person B is entitled to collect, based on the provisions of article 13 of Law 4690/2020, half of the 40% of the sub-rent that he did not collect, i.e. 20 euros (50% * 40).
The natural person B who uses 80 of the 100 sq.m. of the property he leases (ie, 80% of the property), he is entitled to pay the natural person A reduced by 40% the monthly rent corresponding to 80 sq.m., i.e. an amount of 240 euros (80% * 500 = 400 euros, 400 * 40% = 160 euros, 400 – 160 = 240 euros).
Finally, natural person A is entitled to collect based on the provisions of article 13 of n .4690/2020 half of the 40% of the rent that was not collected from natural person B, i.e. 80 euros (160* 50%).
