OBTAINING OF RENTAL INCOME IN TÜRKİYE
Obtaining of rental income is bound to collection principle. In order to tax the rental income in accordance with the collection principle, it should be collected in cash or in kind.
Collection of Rental Income in Cash
Collection of rental income in cash states that the payment of rent in Turkish Liras or in foreign currency. Received cheques are also taken into account as collection in cash.
• Rental income collected by the taxpayers relating to that year or previous years is taken into account as the income of the year which it is collected in.
Example, if 2020, 2021 and 2022 rental incomes are collected in 2022, these incomes will be taken into account as the income of the year 2022.
• Rental income relating to prospective years which is collected in advance is not taken into account as the income of the year which it is collected in but as the income of the years which the income is related to.
Example, if 2022, 2023 and 2024 rental incomes are collected in 2022, each year’s rental incomes will be taken into account as the income of the related year.
In terms of renting transactions in foreign currency, gross revenues in rental incomes are determined according to the exchange rate announced by the Central Bank of Republic of Türkiye on the collection date.
Collection of Rental Income in-kind
If the rental payment is collected in-kind (property, ware etc.), payments are valued according to the Tax Procedure Law No. 213
Collection and Payment of Leasing by Means of Banks or Postal Administration
According to the Income Tax General Communiqué Serial No. 268 and 298 which are published for the authentication with documents issued by banks or postal administrations of the collections and payments that are made in connection with the transactions regarding workplace and residential rentals;
• For residence, 500 TL or over per month for each house; in case of weekly, daily or similar short-term housing rental regardless of the amount for those who obtain a rental income,
• For workplace, without a limitation of amount for those who lease out their workplaces and their tenants need to make the payments and collection of the leasing by means of banks, financial institutions or postal administrations and are obliged to authenticate their payments and collections through documents issued by these institutions.
Since receipt or monthly statement is issued for the payment and collection while using mediums like depositing money, money order, cheque or credit cart by means of banks, financial institutions or postal administrations, these documents shall be accepted as certifying documents. Payment and collection carried out via internet banking are also evaluated in the same scope.
The fine which shall be applied to persons who do not comply with the aforesaid obligations is 5% of each transaction’s amount and it should be no lower than the amount of special irregularity fine determined for that year in accordance with the Repeating Article 355 of the Tax Procedure Law.
Source: Revenue Administration
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