Professional farmers have the opportunity to increase their income by starting up a home-craft activity for the preparation of foodstuffs or soaps based on their production products.
Conditions
Home-craft activity may be carried on by professional farmers who are registered in the register of farmers and agricultural holdings, MAAE. For the start of the activity, registration in the information system “Central Electronic Register Home Craft” (K.H.M.O.) of the Ministry of Rural Development and Food, YPAAT, is required, at the website www.minagric.gr. For monitoring compliance with the provisions as well as for the finalisation of the registration or its rejection, the Agricultural Economy and Veterinary Directorates (DAOK) of the Regional Unit are responsible.
Home-craft foodstuffs are foods produced after small-scale processing, using agricultural raw materials exclusively of own production. Farmers may sell their home-craft products from their registered office, that is, their home, at periodic local events such as trade fairs and municipal events, at farmers' markets, at producers' markets, in retail businesses and in mass catering outlets.
The quantities that may be produced are calculated on the basis of the production of the farmer's primary product, which is also the main ingredient of the home-craft product. However, cooperation between two or more producers is possible, provided that they produce the same initial product and are registered in K.H.M.O. If one or more other parties are not registered in K.H.M.O., then the person responsible for declaring the cooperation is the one registered in K.H.M.O.
How is income from home crafts taxed
Income arising from home-craft activities is taxed as agricultural income. Thus the tax scale is as follows: for profits from 1-20.000 euros at 22%, for profits from 20.001 to 30.000 euros at 29%, from 30.001 to 40.000 euros at 37% and for profits above 40.001 at a rate of 45%. The tax reduction also applies from 1.900 to 2.100 euros (that is, they are tax-free) and there is also the obligation to carry out electronic transactions to build up the tax-free allowance unless one of the exceptions applies, in which case there will be an obligation to collect paper receipts.
Insurance
In order to carry on a home-craft activity, it is compulsory to be insured with OGA, as insurance with OGA is one of the conditions for a farmer to be classified as a professional farmer and for the certificate required for registration in K.H.M.O. to be issued. The minimum social security contributions of farmers are calculated on the basis of 70% of the minimum statutory wage. The minimum contribution is calculated for the main pension branch for 2019 is 18%, for 2020 it will be 19%, for 2021 to 19,5% and from 2022 onwards at 20%. The additional contribution for the farmers' pension branch, beyond the minimum, is set at rates of 12%, 12,67%, 13%, 13,33% respectively. For the health care branch the contribution is 6,95% and for the Agricultural Home Account LAE the contribution is 0,25%.
Types, packaging and quantities of home-craft foodstuffs
The types of home-craft foodstuffs are:
Cereal products, in particular simple bakery products (e.g. paximadia etc.) and pasta with cereal flour as the main ingredient (e.g. trachanas, hilopites etc.).
Plant-based products with sweetening agents, in particular spoon sweets, marmalades, compotes, fruit jellies, sesame bars with nuts.
Products with virgin olive oils and various aromatic plants, spices, essential oils, fruit juices etc. foods in packaging up to two (2) litres.
Products preserved with salt, vinegar and oil, plant-based foods, in particular table olives and olive products, spreads, pickles, sauces.
Products preserved by drying, plant-based foods, in particular fruit and vegetables, nuts, pulses, aromatic plants.
Products with honey and nuts, dried fruit, mastic, saffron etc. foods.
Dairy products provided that the conditions set out in decision no.3724/162303/22.12.14 KYA ( Government Gazette 3438 /B/2014 ) are met.
The products of para. 1 may be sold only in pre-packaged form.
The quantities of final products are calculated on the basis of the production of the primary product, which constitutes the main primary ingredient of the product, from the producer's crops in accordance with the second subparagraph of point b) of para. 2 of Article 56 of Law No. 4235/2014. The right to prepare home-craft products belongs to the producer or producers of the primary agricultural products that constitute the primary ingredient of the final product. Cooperation between two or more producers for home-craft production is possible.
What supporting documents are required for the start of operation of the home-craft food unit and registration in K.H.M.O. ?
Certificate from the Agricultural Development Departments for the same year as the year of submission of the application for registration in K.H.M.O., proving that the interested party is a professional farmer.
Copy of the cultivation declaration of OSDE, for the same year as the year of submission of the application for registration in K.H.M.O.
Proof of payment of the e-fee for registration in K.H.M.O.
Exact photocopy of the health certificate as well as the chest X-ray report. The health certificate is valid for five years from its issue and is renewed after expiry by repeating all examinations.
