Property Taxes

In Turkey according to the current tax regulations, foreign nationals and Turkish citizens are no different in terms of taxes or levies to be charged.

The description of the Turkish direct taxation system, which consists of two main taxes: income tax and corporate tax, are provided in the Income Tax Law 1960 (ITL) and the Corporation Tax Law 1949 (CTL).

For those individuals — the term “individuals” mean natural persons — involved in the Turkish real estate industry, the following taxes and insurances are required: Inheritance and succession tax, VAT (if a commercial delivery takes place), real estate tax, personal income tax (based on rental income and capital gains), earthquake insurance, real estate acquisition and purchase levy (at the time of purchase or sale).

Stamp Duty, environmental tax, corporate tax (in case of a commercial transaction of a company).

The Tax Liabilities Concerning Real Estate

• Type of Tax
• Tax Rates
• Event Occurs Tax Liability
• Explanations

Real Estate Tax

       0.1%
       0.2%
       0.3%
       0.1%

• Sale of a Residential building
• Sale of Non-Residential Building
• Sale of Land
• Sale of Fields

Real estate Tax is accrued in accordance with the official sale value of the property.  Annual taxes are paid in two equal installments. Sale & Acquisition Levy 

       1.5%

Each buyer and seller is to pay sale & acquisition levy. It is collected prior to the transfer of ownership at Land Registry Office.

Inheritance Tax

       1%
       3%
       5%
       7%
       10%

• First Assessment with amount of 140.000 TL
• Next Assessment with amount of 300.000 TL
• Next Assessment with amount of 640.000 TL
• Next Assessment with amount of 1.290.000 TL
• Over the amount of 2.370.000TL of assessment

Taxpayer is the person who acquires property in inheritance or gratis.

Corporate Income Tax

       20%

Sale of real estate owned by Corporate Entities (tax payer)

Income Tax (Individual)

       15%
       20%
       27%
       35%

• Incomes not exceeding 7.500 TL
• Incomes between 7.500-19.000 TL
• Incomes between 19.000-43.000 TL
• Incomes exceeding 43.000 TL

Fixed Tax Amount

• 1.125 TL (for the part with amount of 7.500 TL)
• 3.425 TL (for the part with amount of 19.000TL)
• 9.905 TL (for the part with amount of 43.000 TL)

Value Added Tax

       %1
       %18

• Sale of Real estate (less than 150m² residential)
• Sale of Real estate (residential building over 150m², land)

Footnotes

• Published in the Official Gazette dated January 7, 2006 and numbered 26046.
• Land Registry Law numbered 5444.
• www.tkgm.gov.tr
• Levi, Selim; Yabancilarin Tasinmaz Mal Edinmeleri, Mart 2006 Istanbul, Legal Yayincilik
• Celikel, Aysel; Yabancilar Hukuku 11.Bası; Ocak 2004 Istanbul
• Tapu Kadastro Genel Müdürlüğü Yabanci Isler Dairesi Baskanligi
• Law No.213 of January 4, 1961 (in Turkish “Vergi Usul Kanunu”)

For a general overview of taxation in Turkey please click here.

The content of this article is intended to provide a general guide to the subject matter. Legal advice should be sought based on specific cases or circumstances.