Build in Abroad, Do Not Pay Tax!
1- THE ONE WHO BUILD IN ABROAD, WILL NOT POY TAX!
Yes. You did read right. The ones who build and repair in abroad will not pay tax even for a Turkish Lira.
2- WHAT IS THE LEGAL FOUNDATION FOR IT?
First of all, we have to declare the general rule of paying tax for the institutions totally liable to tax.
“ In the corporate tax law,
“According to the Corporate Tax Law 5520, article number 3; “The ones whose work center is located in Turkey, are liable to paying tax “provision is included in the law.
HOWEVER; in the same law, there is an exclusionary part in which states the rule in the 5th part that the incomes attained by the construction, restoration and montage in abroad and forwarded to the account in Turkey, are not liable to tax.
In the 5.9 part of Corporate Tax Law, entitled “exclusion of the income taxes in which attained by construction, restoration and montage and technical services” ;
“According to the Corporate Law, article number 5, incomes provided by construction, restoration and montage in abroad and forwarded to the accounts in Turkey, are not liable to tax.”
3- YOU DON’T HAVE TO BRING YOUR EARNINGS TO TURKEY!
In the scope of the practice of this exclusion;
Earnings attained by technical services
are not necessarily brought to Turkey.
Transferring of Mentioned incomes in Turkey is enough in order to benefit from the exclusion.
4- IN INCOME TABLE, (PROFIT AND LOSS TABLE) IT WILL BE SEEN AS PROFIT.
Earnings attained out of exclusion scope will be seen as profit in company’s profit and loss table with other transactions of the company and while tax declaration is being issued, it will be deducted out of the tax.
In that way, while your company’s credibility is evaluated by the finance and loan rating agencies, your foreign profit will affect your situation positively.
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither MuhasebeNews nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.