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Official Efes Taster
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Taxes In Turkey Guide
Some (hopefully useful) information on taxation in Turkey.
Even if you do not work in Turkey, the state finds a way to get a decent amount of tax money from you.
First of all, there’s the VAT (18% except for some foods at 8%), that has to be paid for any goods or service one obtains. While prices in shops and supermarkets usually include VAT, one can still find some traders who will offer to reduce the price if you don’t ask for the invoice (fatura), or sales slip (fis).
If you own an immovable property, you have to pay Real Estate Tax (emlak vergisi). Emlak Vergisi is paid in two instalments, end of May and end of November, at the municipal property office (belediye emlak servisi). The tax is calculated according to the value that the municipality fixes for that particular property. The percentage is 1% for private houses, 2% for commercial properties, and 3% for non-developed land.
In case you have invested in property and want to re-sell it before 5 years has passed (until 2006 the period was 4 years, from 2007, 5 years), you will have to pay Capital Gains Tax (kiymet artisi vergisi), of between 10-20% depending on whether the seller is a person or a company. This tax does not apply to inherited property.
Turkish lira bank accounts pay good interest but bear in mind that 10% of the benefit will have to be paid as Witholding Tax (stopaj vergisi).
If you rent your home out, there’s an Income Tax to be paid once a year. If your rental income exceeds 2200 ytl per year, the exceeding amount (minus a flat rate of 25% for maintenance expenses), is liable to a tax of 20%. This tax can be paid in two instalments (end of March, end of July).
Cars or motorcycle owners know that Vehicle Tax (MTV), is no longer an insignificant sum. The amount is calculated according to the vehicle’s age and engine size. Vehicle tax is paid to the tax office in two instalments at the end of January and the end of July. Of course this tax holds for owners of boats/yachts, light planes and helicopters as well.
Quite a few foreigners have founded companies to buy properties they fell in love with. Even though inactive, there are fees to be paid to the state such as monthly VAT declarations (KDV beyani), quarterly income declarations (Gelir vergisi beyani), and yearly book stamping fee (defter tasdik parasi). Once the company has started to work actively, there is Corporation Tax (kurumlar vergisi), to be paid on the benefit. The company tax rate was reduced in 2006 from 40% to 20%, payable in quarterly instalments of temporary or provisional tax (gecici vergi). The temporary tax is calculated according to the expected income, and a final payment according to the exact balance of the previous year has to be made in April.
If the company has employees, there’s the Employment Tax (muhtasar), to be paid for them (in addition to social security, pension scheme etc). You even pay muhtasar for the company’s accountant.
The maximum allowance for non-taxable income (house cleaning, private lessons etc), is 2600 YTL per year.
The income tax rate for self-employed persons is 15% as long as the yearly income does not exceed 7500 YTL, 20% if the yearly income is below 19000 YTL, and 27% for income up to 43000 YTL per year.
Please be aware that not paying due tax can cause serious difficulties. You may be stopped leaving the country until your tax debts are paid.
Tax obligations and rate may change. Please check all information before you proceed.
Source : Issue 43 Bodrum Observer
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Last edited by ceemac : 25th October 2007 at 14:43.
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