Investing in real estate in Turkey involves understanding various tax implications. Here's an overview to help you navigate the taxation landscape:
Property Purchase Tax
When purchasing property in Turkey, buyers are required to pay a property purchase tax (also known as Title Deed Conveyance Tax). This tax is 4% of the property's declared value and is usually split equally between the buyer and the seller.
Annual Property Tax
Owners of real estate in Turkey must pay an annual property tax, which varies depending on the property's location and type. Rates typically range from 0.1% to 0.6% of the property's assessed value.
Rental Income Tax
If you rent out your property, you are subject to rental income tax. The tax rates range from 15% to 40% depending on the amount of income earned. Deductible expenses, such as maintenance costs and property management fees, can reduce taxable income.
Tax Credits
If you sell your property within five years of purchase, you will be subject to capital gains tax on any profit made from the sale. The tax rate is progressive and ranges from 15% to 35%. However, properties held for more than five years are exempt from this tax.
Value Added Tax (VAT)
VAT applies to new properties sold by developers, typically at a rate of 18%. However, there are exceptions and reductions available under certain conditions, such as for foreign buyers or those investing in specific types of properties.
Inheritance and Gift Tax
Turkey imposes inheritance and gift tax on the transfer of property through inheritance or as a gift. The tax rates range from 1% to 30%, depending on the relationship between the donor and the recipient and the value of the property.
Double Taxation Agreements
Turkey has double taxation agreements with many countries to prevent investors from being taxed twice on the same income. These agreements can provide tax relief and should be considered when planning your investments.
Why Choose Investisor for Real Estate Investments in Turkey?
At Investisor, we provide expert guidance to help you navigate the complexities of real estate taxation in Turkey. Our experienced team ensures that you are fully informed and compliant with all tax regulations, optimizing your investment returns.
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For detailed advice and support on real estate taxation and investment opportunities in Turkey, contact Investisor today.
