How to Benefit From Tax Exemption in Turkey?

The problem of paying real estate taxes for many real estate buyers and investors is a real problem. with it. It is one of the burdens that he may have, and there have been many questions about this subject, and in order to obtain adequate answers about it, the editorial team at Binaa Real Estate has prepared this detailed report for you on everything related to it.

We wish you an enjoyable reading.

Can you be exempted from tax in Turkey?

The Turkish government has provided a lot of facilities for those wishing to buy real estate in Turkey, and this was one of the most important motives that encouraged and pushed foreigners from different countries of the world to be their first undisputed destination. Among the many facilities that have been provided in this regard is the possibility of benefiting from tax exemption, which is an important opportunity that many people and buyers seek to take advantage of. How are you exempted from paying tax?

Through the following points, you can see the cases in which real estate buyers can be exempted from paying taxes in Turkey:

1 - If the foreigner is not residing in Turkey.

2 - If the company or commercial entity has no headquarters in Turkey.

3 - If the real estate buyer has not resided in Turkey for more than 6 consecutive months during the previous or current year.

4 - The property owner should not have a valid residence permit.

5 - The property must be newly constructed, i.e. not old or worn out.

6 - The real estate must be designated for housing, as commercial real estate is not covered by the tax exemption law.

7 - The price of the property must be paid through a foreign bank and in foreign currency.

8 - The tax-exempted property cannot be sold before the lapse of a full year.

Documents required to benefit from tax exemption:

In order to benefit from tax exemption in Turkey, there are a lot of papers and documents that must be processed, and this is what you can see below:

-To bring a copy of the passport, it must be translated into Turkish and certified by the notary public.

-The purchase contract that must be signed between the buyer and seller.

-Bring the tax number, and it is extracted from one of the tax departments in Turkey very easily.

-In the case that someone other than the buyer will be authorized to complete the acquisition procedures, a power of attorney must be obtained.

Types of taxes in Turkey:

If you intend to buy real estate in Turkey or settle in it, you must look at the various types of taxes stipulated in the Turkish Constitution, and this is what you can see through the following paragraphs:

First: Income Taxes:

This type of tax in Turkey is divided into two types, the first is an income tax on individuals and the second is on companies. As for individuals, the net income is calculated during the year and then the tax is applied to it, which ranges between 15% and 35%. What should be mentioned in this regard is that the matter is different depending on the individual's case, the tax amount imposed on a certain person in Turkey is different from that of residents in other countries.

As for the income tax imposed on companies, in turn, it is divided into two parts, the first 20% and the second 15%, the first percentage for non-resident companies and the second for resident entities.

Second: Value Added Tax:

It is considered one of the main types of taxes in Turkey and is paid when practicing any type of commercial or industrial activities such as importing, exporting or others, and its value ranges from 1% to 18% and is often only 1%. The maximum percentage is imposed on commercial real estate and real estate that its area exceeds one hundred and fifty square meters.

Third: Property Transfer Tax:

When you buy a property in Turkey, the ownership of the sold property is transferred from the seller to the buyer, and a fee is charged for this process amounting to 4% of the total property value. Both parties, provided that the seller pays the full amount.

Fourth: Writing the initial contract:

Many real estate buyers in Turkey choose to initially sign the contract at the notary, and this is when the property is under construction in order to guarantee their rights, which is optional and is only 1% of the total property value.

Fifth: Annual Tax:

When you are the owner of a property in Turkey, there is an annual tax that must be paid, which is 0.002% of the property value. It should be noted that it is paid for the first two phases in March and the second in October. As for the method of payment, it is either by going to the region’s municipality or by transferring the amount through a bank in Turkey.

Sixth: Revenues of the complexes:

Whoever chooses to live within the residential complexes in Turkey, which is the current real estate style and the most popular choice among the public looking for real estate for sale in Turkey, in order to benefit from the many services and recreational facilities that are provided, but therefore there are a lot of extra expenses that you will find in front of you, which average 50 US dollars, which varies from one complex to another, according to the services it provides.

In the context of the taxes and costs that the buyer will have to pay when buying real estate in Turkey, we have a real estate appraisal document, which is considered a very reasonable cost, as it reaches a maximum of two hundred US dollars, it controls the prices of real estate and prevents any price manipulation by sellers, and the order to obtain it takes only three days and may extend to a week at the latest, and in some cases, as for its validity, it remains valid until three months from the date of its issuance.

There is also an earthquake insurance policy that is obtained from an insurance company and the cost of extracting it varies according to the property, its specifications, location and other details. It is a mandatory document that protects the investor's rights from being lost in the event of any earthquake or natural disaster.

There is a real estate ownership tax in Turkey, which amounts to 3.9% of the total property value. Do not forget that you will have to pay translation fees into Turkish, and there are costs of attesting all papers and documents with the notary.

What does exemption from tax value in Turkey indicate?

This matter, if indicated, indicates a great cooperation from the Turkish government and its great efforts to attract the largest possible number of businessmen and investors in order to revitalize the real estate and economic sector and its desire to enter the club of the Big Ten, and this is only a small part of the many facilities that were keen to provide to those interested in buying real estate in Turkey.

In this context, it must be noted that the Turkish government is constantly working to provide a lot of important facilities, and Turkish laws are known to be flexible and suitable for many foreigners, and this is what made Turkey the main destination instead of European, Arab or Middle Eastern countries that are experiencing many crises and collapsed economic conditions.

The importance of buying real estate in Turkey:

In your opinion, what are the main reasons that make buying real estate in Turkey a special idea? It is noticeable that Turkey has surpassed many countries in the world in the fourth place in the world as the most important destination for real estate ownership and investment.

Through the following paragraph, you can see the most important motives for buying real estate in Turkey:

First: The great desire to obtain Turkish citizenship, which is one of the most important nationalities in the world, due to the ease of obtaining it and the many advantages it offers to its holder. It can be noted that many amendments were issued regarding the Nationality Law, the last of which was in the current year 2022. Here, there are many other amendments that was stipulated by Turkish law in late 2018.

Second: One of the first motives that encourage the purchase of real estate in Turkey is the desire to obtain real estate residency, which is one of the most important types of residencies in Turkey at all due to the ease of renewal as long as the foreigner is the owner of real estate.

Third: Real estate prices in Turkey are low when you compare them with real estate prices that you find in Europe or other countries around the world.

Fourth: Real estate in Turkey is characterized by its high quality and unprecedented luxury. If you take a look at the real estate market in Turkey, you will find that many important construction projects are being built at the present time, in order to meet most desires, tastes and budgets.

Fifth: The rights of the Turkish citizen are equal with the foreigner in Turkey. what the first has the right of, the second has it also, and therefore anyone around the world can buy apartments in installments if they do not have sufficient financial balance in order to pay the price of the property in cash, and from here, he will not have to face any pressure. However, the payment of all the resulting installments in the long term on dates to be agreed upon between the seller and the buyer.

Sixth: Ease of procedures for owning real estate in Turkey. What you do not know in this regard is that you can buy a property in Turkey and complete all procedures in a very short period.

Among the main reasons for the great demand for buying real estate in Turkey is that it is possible to buy any type of real estate without restrictions and thus can benefit from this great diversity witnessed by the real estate market in Turkey, as it is a unique opportunity for real estate investment and obtaining a lot of profits in no time, as it is known about real estate prices in Turkey that they are witnessing a significant acceleration in their prices.

One of the important tips that everyone should take into consideration when buying a property in Turkey for real estate investment is to buy when prices are low and resell when prices rise to take advantage of the price difference between the buying and selling stages. Real estate can also be rented for a stable and good monthly return.

How to buy a property in Turkey easily?

There are several steps that you must follow when buying real estate in Turkey so that you do not find any obstacles or difficulties in front of you, which are:

-Determine the purpose you want to achieve from the purchase, it may be real estate investment, it may be housing and stability, and it may be the desire to obtain Turkish citizenship.

-You have to determine the budget you have, is it enough to pay the full price of the property in cash, or will you have to borrow?

-Find a distinguished real estate advisor who helps you to search for buying a property in Turkey, as it saves you a lot of effort, fatigue and time and avoids paying money in the wrong place.

-There are a lot of routine procedures that need to be done in a legal way out of the way around and it is preferable to hire a legal expert.

-Avoid becoming a victim of real estate fraud by checking out its various famous tricks and methods.

-Check the legal status of the property and make sure that it is free of any problems that may hinder the achievement of your goals.

-When investing in real estate, stay away from large properties because renting them is somewhat difficult.

-When searching for real estate for sale in Turkey for housing, choose what suits you and your family.

For more information about the real estate market in Turkey, we advise you to follow our website constantly because we provide you  with everything that is new and important to you about it, and we are keen to inform you of the latest amendments to laws and regulations.

Binaa Real estate  services:

Real estate marketing in Turkey/ Legal and after-sales services /Assistance in obtaining Turkish citizenship

Property management in Turkey / Real estate tours/ Airport reception.

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