Turkey Property Taxes
Properties tax can be tough to understand, especially if you are purchasing a property in another countries.
Aside from the taxes you pay when you buy a property, there are other taxes to consider, such as yearly taxes and VAT.
In this article,we'll go through the taxes you'll have to pay if you buy and hold property in Turkey.
Purchasing Tax (Title Deed Fee)
When you buy a property in Turkey, you receive a title deed,or "Tapu," which comes with a cost of 4% of the purchase price.This amount is normally divided in half and shared between the sellers and buyers. However, depending on the terms of the agreement, you may be required to pay the entire amount as the buyer,or conversely.
VAT (Value Added Tax)
All commercial, industrial, and professional transactions in Turkey are chargeable to Tax under Turkish laws. However, there are several special cases:
If the present homeowner is not involved in any commercial business, if the current owner of the property is not in the real estate trading industry,
and if the property has been held for more than two years.
In Turkey, the VAT rate is 18%. If the property you want to purchase does not fall into one of the aforementioned categories and is a commercial property, you must pay this percentage, computed over the sales price. If you acquire a residential property with a net area of less than 150 m2, you must pay VAT at a rate ranging from 1% to 8%.
When you make the purchase agreement, you must also pay 0.948 percent stamp duty, which is determined over the agreement's price.
Annual Property Tax
You will also have to pay an annual taxes if you own property in Turkey. This tax change on the city and the kind of property. For example, if your property is in Istanbul, the annual tax will be 0.2 percent of the property's worth.
If you decide to rent out your apartment, keep in mind that you will have to pay income tax. The same regulation applies if you decide to sell your home; however, after five years of ownership, there will be no income tax.
2021 Tax Rates Depending on Rental Income in Turkish Lira (₺)
up to ₺24,000 – 15 percent
up to ₺53,000 – for ₺24,000 of income the tax is ₺3,600, the rest of the sum – 20 percent
up to ₺130,000 – for ₺53,000 of income the tax is ₺9,400, the rest of the sum – 27 percent
up to ₺650,000 – for ₺130,000 of income the tax is ₺30,190, the rest of the sum – 35 percent
Over ₺650,000 – for ₺650,000 of income the tax is ₺212,190, the rest of the sum – 40 percent
In Heritance Or Gift Tax
If you obtain a property by death or giveaway, keep in mind that you will be subject to a tax ranging from 1% to 30%. These taxes can be paid in two installments over a three-year period.