Tax and Turkish Real Estate

With its steady growth, Turkey attracts more foreign investors day by day. Taxes are a concept that you will constantly encounter while investing in real estate and living in Turkey. Although there are many different types, there are various types of tax and Turkish real estate that you may encounter regarding the housing purchase processes. These are Title Deed Transfer Tax, Annual Real Estate Tax, Value Added Tax, Real Estate Value Increase Tax, and Rent Income Tax. 

Real estate buyers are obliged to pay real estate purchase tax in Turkey. This tax is called the title transfer tax. It is applied as 4% of the sale price of the real estate. Property taxes are paid at different stages in Turkey. For example, buyers pay title tax when purchasing a property. This tax is paid only once. On the other hand, annual property tax is paid regularly in certain months. We have compiled for you what you need to know about tax and Turkish real estate.

Do Foreigners Pay Property Taxes in Turkey?

Especially in recent years, it is seen that the profitability of real estate investments made in Turkey is high. Another important issue for foreign investors is the regulations regarding tax and Turkish real estate. Foreign investors need to know which types of taxes cover their investments made in Turkey. 

Property tax must be paid for all immovable property located within the borders of Turkey in accordance with the law. Foreign investors who do not reside in Turkey are subject to taxation as limited taxpayers for the rental income and sale of their real estate. In addition, the rental and sale of real estate may be associated with value-added tax in some cases. According to real estate law, any residence, workplace, or land within the borders of Turkey is subject to real estate tax. The taxpayer is the owner. Therefore, in terms of tax and Turkish real estate, foreigners who buy real estate in Turkey are required to pay real estate tax.

How Are Property Taxes Paid in Turkey?

Real estate tax installment payments differ according to the type and size of the real estate. It is important for foreign investors to know the payment methods for tax and Turkish real estate. Owners can make property tax installments in various ways. Tax payments can be made via EFT/Money Transfer, the website of the Revenue Administration and the official website of the affiliated municipality. 

Property tax can be paid in one installment or in two installments. Tax payments to be made through credit/debit cards and other payment channels of banks operating in foreign countries; they can do this by selecting the (Foreign Payments) tab on the interactive tax office on the website of the Revenue Administration at www.gib.gov.tr. Interactive tax office is a reliable system that allows the services provided by the Revenue Administration to be performed easily, quickly and effectively in an electronic environment without seeking time and place conditions. In this way, foreigners can make tax payments related tax and Turkish real estate.

Is It Worth Investing In Property In Turkey?

With the Foreign Direct Investment Law, the number of foreign investments and companies in Turkey has increased and continues to increase. Thanks to this law, obstacles in front of foreign investors have been removed and many advantages have been provided to investors. Moreover, Turkish investors living abroad can also benefit from these advantages. One of the issues that foreigners should pay attention to when investing is the functioning of tax and Turkish real estate. There are many advantages and special tax regulations for foreign investors in Turkey. In line with these possibilities, real estate investment in Turkey can provide profit in many ways. 

Foreigners making direct investments can equally benefit from the opportunities provided to domestic investors. In addition, foreigners who want to invest in Turkey; They can benefit from tax discounts, investment location allocations, insurance premiums and similar government incentives. There are joint agreements with various countries in order to prevent foreign investors from paying taxes both to their own countries and to Turkey. From the point of view of foreigners, the tax and Turkish real estate opportunities provided for indicate that it is worth investing in real estate in Turkey.

It is important for foreigners to have knowledge of tax and Turkish real estate for their investments in Turkey. When all these conditions are met, when the requirements of the tax system are applied, you can have suitable options for investing in property in Istanbul or in other parts of Turkey.

You can read our " Why should you invest in property in Turkey " blog.