tax liabilities – Muhasebe News

What are the Tax Liabilities in Turkey?

MuhasebeNews — Sat, 01 Dec 2018 09:30:52 +0000

In general, residency criterion is applied in determining tax liability for individuals. This criterion requires that an individual whose domicile is in Turkey is liable to pay tax for his worldwide income (unlimited liability). Any person who resides in Turkey more than six months in one calendar year is assumed as a resident of Turkey. However; foreigners who stay in Turkey for six months or more by the reason of a specific job or business or particular purposes which are specified in the PIT Law are not treated as resident. Therefore, unlimited tax liability is not applicable for them.

In addition to residency criterion, within a limited scope, nationality criterion also applies regardless of their residency status, Turkish citizens who live abroad and work for government or a governmental institution or a company whose headquarter is in Turkey, are considered as unlimited liable taxpayers. Accordingly, they are subject to PIT on their worldwide income. Non-residents are only liable to pay tax on their income derived from the incomes in Turkey (limited liability). For tax purposes, it is especially important to determine in what circumstances income is deemed to be derived in Turkey. The provisions of Article 7 of the PIT Law regulate this issue.

In the following circumstances, the income is assumed to be derived in Turkey.

Business Profit: A person must have a permanent establishment or permanent representative in Turkey and income must result from business carried out in this permanent establishment or through such representatives.

Agricultural Income: Agricultural activities yielding income must take place in Turkey.

Wages and Salaries:
– Services must be rendered or accounted for in Turkey,
– Fees, allocations, dividends and as such paid to the chairmen, directors, auditors and liquidators of the establishment situated in Turkey must be accounted for in Turkey.

Income from Independent Personal Services: Independent personal services must be performed or accounted for in Turkey.

Income from Immovable Property:
– Immovable must be in Turkey,
– Rights considered as immovable must be used or accounted for in Turkey.

Income from Capital Investment (interest, dividends, etc.): Investment of the capital must be made in Turkey.

Other Income and Earnings: The activities or transactions generating for other income, specified in the PIT Law, must be performed or accounted for in Turkey.

The term “accounted for” used above to clarify tax liability of the non-residents means that a payment is to be made in Turkey, or if the payment is made abroad, it is to be recorded in the books in Turkey.

Source: Revenue Administration

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.

What Are Your Tax Liabilities When You Buy a Real Estate in Turkey?

MuhasebeNews — Tue, 30 Oct 2018 10:00:49 +0000

According to the Fees Code, the total rate of Title Deed Fee is 4%. Both the purchaser and the seller are liable to pay the title deed fee as 2% of the price of real estate (except Value Added Tax).

The amount of invoice arranged for real estate and the amount of transfer from the bank should be the actual purchase price.

Following the procedures at the land office, you can pay your title deed fee to authorized tax offices or banks having a contract with Turkish Revenue Administration.

After getting your title deed, you should inform the municipality affiliated to your real estate location about your property tax.

Tax and SSI Amnesty are in the Road! Initial Payment will be done on July-2017 According to Turkish Laws!

MuhasebeNews — Sat, 06 May 2017 07:15:52 +0000

1- INSTALLMENT PLAN FOR TAX AND SSI LIABILITIES BETWEEN 01.07.2016 – 31.03.2017 IS IN THE ROAD!
People who made an installment plan for liabilities that are until the end of June 2016 but could not pay or partially paid their accrued liabilities for between July 2016 and until the end of March 2017 will have right to make an new installment plan.

There will be no “TAX BASE INCREASE” in the new regulation.
There will be no “STOCK AMNESTY” in the new regulation.
There will be no “CASH AMNESTY” in the new regulation.
There will be no “PARTNERS AMNESTY” in the new regulation.

2- THE LIABILITIES THAT WERE IN THE INSTALLMENT PLAN LAST YEAR WILL GO ON IN THE SAME MANNER!
With the Bag Law numbered 6736, the installment plan of current liabilities of the tax payers who made an installment plan for their tax and SSI liabilities will go on in the same manner.

3- PEOPLE WHO COULDN’T MAKE AN INSTALLMENT PLAN LAST YEAR WILL BE ABLE TO APPLY FOR ALL OF THEIR PREVIOUS LIABILITIES!
People, who didn’t/couldn’t make an installment plan for their tax and SSI liabilities within the scope of the Bag Law numbered 6736, will be able to apply for all of their liabilities (31 March 2017 and before that date) with the new regulation.

4- TOTAL AMOUNT OF LIABILITY IS 73 BILLION TURKISH LIRAS
The amount of new installment is 72 Billion Turkish Liras. How much of those liabilities are within the scope of installment will be determined at the end of the application.

5-THE CAPITAL WILL REMAIN, THERE WILL BE INSTALLMENT FOR THE LATE FEE!
The capital will remain the same like the previous installment plan; however, there will be installment for the late fee. On the other hand, the liabilities can be extended to 3 years after the calculation of the installment. If demanded, liabilities can make 6-9-12-18 installments or pay all of the amount in cash. The installment will be paid bimonthly.

6- WHEN WILL THE NEW INSTALLMENT PLAN BE ENACTED?
The Law about the installment plan is planned to be published in the Official Gazette in the middle of May and come into force at the same day.

7- WHEN IS THE APPLICATION PERIOD FOR THE NEW INSTALLMENT PLAN?
The application period for the new installment plan will begin as of the date of publishing date and it will last until 30 June 2017.

8- WHEN IS THE INITIAL PAYMENT OF THE NEW INSTALLMENT?
The initial payment of the new installment for liabilities can be made;
until 31 July 2017 for tax liabilities,
until 31 August 2017 for SSI liabilities.