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Real Estate VAT Exemption in Turkey

Real Estate VAT Exemption in Turkey

Last Updated on 26 июня, 2024 by Ideal Editor

Real Estate VAT Exemption in Turkey

To claim real estate VAT exemption in Turkey, you need to understand the benefits and rules. Since April 2017, property sales surged due to VAT exemption. Here’s how to proceed:

Overview of VAT Exemption: Foreign and Turkish citizens now enjoy reduced VAT rates or exemptions when buying property, subject to certain conditions.

Eligibility Criteria:
  • Must not have resided in Turkey for six months, unless for specific work or project purposes.
  • Payment must be made in foreign currency.
  • Property must not be sold within a year of purchase.
  • First-hand properties from construction companies qualify; secondhand properties do not.
Application Process:
  • Pay at least 50% of the sales price before the invoice.
  • Complete payment in foreign currency within a year.
  • Apply for a VAT refund at a tax office after purchase, with the required documents.
Required Documents:
  • For Turkish citizens: Residency proof abroad and work permit.
  • For foreigners: Passport copy, Turquoise card (if applicable), entry-exit records, and property title deed.

Payment Requirements:

  • Transfer funds through a Turkish bank and submit the debit receipt for verification.
Additional Conditions:
  • Specific documentation is required for payments made via credit card, loan, or cash brought from abroad.

Understanding these steps ensures a straightforward process to benefit from VAT exemption when investing in Turkish real estate.

Frequently Asked Questions (FAQ) on Real Estate VAT Exemption in Turkey

What is the VAT exemption on real estate purchases in Turkey?

  • The VAT exemption allows both foreign and Turkish citizens to enjoy reduced VAT rates or exemptions when purchasing property in Turkey, provided they meet certain conditions. This incentive, introduced in April 2017, has significantly boosted property sales.

Who is eligible for the VAT exemption when buying real estate in Turkey?

  • To qualify for the VAT exemption, you must not have resided in Turkey for six months before the purchase, except for specific work or project purposes. Payment must be made in foreign currency, and the property cannot be sold within a year of purchase. Additionally, only first-hand properties from construction companies are eligible, not secondhand properties.

What is the application process for claiming VAT exemption on real estate in Turkey?

  • To apply for the VAT exemption, you need to pay at least 50% of the sales price before the invoice is issued and complete the payment in foreign currency within a year. After the purchase, you must apply for a VAT refund at a tax office with the required documents.

What documents are required to apply for the VAT exemption?

  • For Turkish citizens, you need to provide residency proof abroad and a work permit. For foreigners, the required documents include a passport copy, a Turquoise card (if applicable), entry-exit records, and the property title deed.

Payment requirements to qualify for the VAT exemption?

  • Payments must be transferred through a Turkish bank, and you must submit the debit receipt for verification. There are also specific documentation requirements for payments made via credit card, loan, or cash brought from abroad. Ensuring compliance with these payment requirements is essential for qualifying for the VAT exemption.

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