Value-added tax in Turkey, Turkey is interested in collecting taxes, and value-added tax is a tax that is imposed on goods and services that are collected by the government, it applies to most companies throughout the country and is an important source of revenue for the government, so everyone who resides In Turkey, to have a comprehensive knowledge of tax issues in Turkey and to search for accurate information on that subject, we will tell you about the types of taxes in Turkey:
Types of taxes in Turkey:
In Turkey, there are several types of taxes that citizens have to pay. These taxes can be divided into:
1 - Value added tax:
Value Added Tax (VAT) in Turkey is a form of indirect tax imposed on the sale of goods and services of an independent industrial, commercial, agricultural and artisanal nature. It is a tax added to the final price of a product or service and is paid by the buyer.
There are exemptions from value-added tax in Turkey or types subject to 0% of the tax, including:
Oil exploration activities.
Manufacturers within the free zones.
Exports, goods exported from Turkey.
Transit transportation.
Ports and airports services provided to ships and planes.
Roaming services within Turkey that are provided to customers.
Insurance transactions and expenses.
Imported machinery and equipment within the scope of investment certificate.
VAT rates in Turkey:
- In Turkey, a value-added tax of 1% is imposed on nuts, grains, dried vegetables, newspapers, used transportation services, funerals, and seeds.
- Value-added tax is levied in Turkey at 8% on animals, foodstuffs, bags, strings, shoes, some agricultural machinery, medical tools, accommodation services, books (excluding electronic books), entry to cinemas, theaters, opera, ballet, museum, furniture, textile and clothing products.
- Finally, this tax is imposed at the rate of 18% on communication services.
VAT is an important source of revenue for the Turkish government, and helps fund public services that are important to businesses. Understanding how they operate and ensuring compliance with regulations can help them increase their profits while adhering to the law.
Personal income tax:
Personal income tax applies to all individuals earning income in Turkey. Income from wages, salaries, investments and other sources is subject to tax, and the rate varies according to an individual's earnings.
The following is a list of individual income items that are subject to taxation in Turkey:
- agricultural profits.
- business profits.
- Salary or monthly wage.
- Independent services income.
- Income from immovable property.
- Income from movable property.
- Other earnings and revenue.
The tax is calculated on individual income starting from 14,800 TL.
Here are the tax rates in Turkey on per capita income:
- The income value is 14,800 Turkish liras, and the tax rate is 15%.
- The income value is 34,000.14,801 Turkish liras, and the tax rate is 20%.
- The income value is 120,000.34,001 Turkish liras, and the tax rate is 27%.
- More than 120,000 TL, the tax rate is 35%.
Personal income tax in Turkey is an important source, as it helps fund essential services such as: healthcare and education. By understanding how personal income tax works in Turkey, taxpayers can ensure that they comply with all relevant laws and regulations.
Wealth and property taxes in Turkey:
Wealth and property taxes in Turkey can be a difficult topic to understand. There are some helpful tips to keep in mind. There are also three types of wealth taxes:
Car taxes.
Inheritance and gift taxes.
Real estate property taxes.
Below we will show you some details about wealth and property tax rates in Turkey:
- Buildings, apartments, and real estate loans, the tax rate is 0.6.0.1%.
- Protection of immovable cultural property (cultural buildings) The tax rate is 10%.
- Inheritance and gift taxes The tax rate is 30.1%.
Note, with regard to car taxes in Turkey, they are related to two points:
its engine capacity.
vehicle age.
Also, the tax value rate is determined differently each year.
For those who want to invest in Turkey, it is important to understand these wealth and property taxes as they can have an impact on investments made in the country. The Turkish government provides clear information about applicable taxes, so investors should make sure they are aware of them before investing. .
4 - Special consumption tax in Turkey:
Turkey has implemented a special consumption tax (SCT) on some goods and services, and there are four main groups of products that are subject to the special consumption tax, including:
entertainment products.
Tobacco products and alcoholic beverages.
Vehicles of all kinds: cars, planes, helicopters, yachts and motorcycles.
Petroleum products and their derivatives such as: lubricating oils, natural gas, solvents and their derivatives.
The SCT rate varies depending on the taxable item.
In short, SCT in Turkey helps protect businesses and consumers from price hikes due to increased taxes on certain items while providing an important source of revenue for the government.
Advantages of value added tax in Turkey:
Value Added Tax (VAT) in Turkey has many advantages that benefit both consumers and businesses.
One of the primary benefits of VAT is that it is a transparent and easy-to-understand system that makes it easier for businesses to comply with their tax obligations, as well as for consumers to understand the costs associated with their purchases.
Another advantage of VAT in Turkey is its simplicity. VAT has a single rate, which means that companies do not need to keep track of multiple rates or exemptions for different goods and services. This makes it easier for companies to manage their taxes and allows them to focus on growing their business rather than worrying about rules.
Tax incentives in Turkey:
Turkey is committed to helping companies succeed and has implemented a number of tax incentives to encourage growth. These incentives also provide companies with the opportunity to maximize their profits while keeping their taxes low.
The Government of Turkey offers a range of corporate tax incentives, including exemption from corporate income tax on profits reinvested in the company and reduced rates on profits not reinvested. Companies may also benefit from a reduced tax rate on dividends paid to shareholders.
In addition, companies may be eligible for an investment incentive certificate, which provides a reduction in corporate income tax for up to five years. The certificate is available for investments in certain sectors, such as: energy efficiency projects, research and development activities, and environmental protection measures.
Turkey has also implemented a number of other tax incentives for companies, including reduced rates on capital gains and exemptions from certain taxes. Companies can also benefit from incentives related to research and development activities, as well as deductions for certain types of expenses.
At the end of our article, if you want to see the most important information related to the real estate market in Turkey, you can visit our website for more information that interests you, as we monitor various and different topics.
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