The purchase of immovable property within the Republic is permitted to citizens of 129 countries, including Russians, Belarusians, Kazakhs and Ukrainians. These foreigners may purchase any real estate, except for a few things:
- the size of the plot exceeds 30 hectares;
- The land plots and properties are located in strategic areas;
- Russians and Ukrainians are prohibited from buying property in the border areas.
In practice, these restrictions are not seen as a problem, as they are not in demand. Foreigners prefer the Antalya region and other developed resorts for their real estate investments. Certainly, it is important to include property taxes in Turkey 2022 into the costs when buying a property on the Mediterranean coast.
The only innovation in 2022 for purchase of the real estate in Turkey – foreigners should address in one of the Turkish banks for the transaction of a conversion of the currency in Turkish lira. After the transaction, the Turkish bank issues a document confirming the currency exchange, and with this paper, the foreigner goes to the Land Registry Office, where after the purchase of the object receives a TAPU – certificate of ownership.
Tax Classification of Turkish Apartments
The property tax rates are the same for foreigners and locals respectively. Let’s take a look at the tax rates for real estate in Turkey and how they are calculated.
- Tapu Devir Vergisi is a one-time payment for the purchase of a real estate in Turkey. The transaction requires the buyer to pay 4% for the registration of the Tapu – ownership deed. The tax is based directly on the cadastral value of the property as stated in the TAPU and is usually lower than the sale price. Theoretically, the tax is paid equally by the buyer and the seller, but in practice this is rare and the taxpayer is the purchaser of the property.
The only difference in purchase tax between foreigners and residents of the country is the amount of duty for the issuance of TAPU (Döner Sermaye). It is $130 for foreign nationals and $45 for Turkish nationals.
- Yıllık Gayrimenkul Vergisi is an annual property tax in Turkey. On average, the total amount does not exceed $150 per annum. The total amount is determined by the type and location of the property and varies from 0.2-0.6%. The fee is:
- for houses and flats – 0.2%, with self-contained cottages being taxed without regard to the land underneath;
- for commercial buildings and premises – 0.4%;
- for land designated for construction – 0.6%;
- for non-construction land – 0.2%.
If the property being purchased has no technical passport, the maximum fee is charged. The tax is paid in equal instalments in the months of May and November.
And non-payment of taxes in Turkey will be followed by penalties ranging from 6% to 8% and applicable:
- if you have income from a rental business;
- if you earn an income from the resale of property;
- if you are inheriting or receiving a gift;
- Emlak Kira Geliri Vergisi – tax on the rental income from the rental of the property in Turkey. The amount of tax varies between 15% and 40%, and is zero for annual returns:
- Up to 7,000 ₺ of the income generated by the rental of residential properties;
- up to ₺ 30,000 for commercial properties.
In other cases, the annual tax is:
- from 15% if the profitability is up to 24,000 ₺;
- up to 35% if the profit exceeds 650,000₺.
Such rates are applicable to individual entrepreneurs and 20% to legal entities.
- Gayrimenkul Değer Artışı Vergisi – a tax based on the profit made from the sale of the apartment. Legal entities are charged 20% and individuals are charged 0% if the owner has held the property title for more than 5 years. In the case of a shorter period, property tax in Turkey for foreigners is charged on the difference between the cadastral value and the sale price of the property. The tax rate depends directly on this difference and can vary from 15% to 30%. If the difference is more than 15,000 ₺, 20% is charged; if it is less, the tax is zero.
- Miras Vergisi – on inheritance and Hediye Gayrimenkul Vergisi – on gifts. The range of tax rates is quite wide – 1-30%. In the case of inheritance of immovable property, the inheritor is charged from 1% to 10% and the donor is charged from 10-30%. The final amount of tax also depends on the price of the property – the cheaper the property, the lower the tax.
It should be noted that since the end of 2020 a law on luxuries has been implemented and expensive houses are subject to taxation. This category includes apartments whose price tag exceeds $845,000. It is the price of the property that is decisive for determining the tax rate. The tax is based directly on its cadastral value and varies between 0.3-1%. The more expensive the object, the higher the tax.
Taxation does not apply to citizens of retirement age, women or the unemployed.
How to pay property tax in Turkey?
There are two ways to pay the tax on Turkish immovable property – you can visit the city administration office personally or you can pay the tax online.
In the case of an in-person visit, only a copy of the Tapu is required to make the payment, no other documents are required. As the tax is paid twice a year: in May and in October, in case of delayed payment, there will be a token penalty.
In order to pay the tax online, you have to enter your tax number in the special column on the Turkish Tax Administration’s website E-BELEDIYE.ALANYA.BEL.TR, then a menu will open where you can choose the transaction you want to make. Next, you will need to confirm the transaction and wait for the payment notification on the screen, save and print it.
Tolerance Homes are a fully licensed real estate agency, which knows all the nuances of taxation in Turkey. By contacting our company, you will be able to find a suitable property for you with the optimal tax rates and get detailed advice on all matters of interest to you. And if you want to resell or lease the property, specialists will help you to minimize taxes in Turkey for non-residents in a legal way.
