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When choosing a country for buying a property, you should also consider the size of tax fees and how the tax system works for foreign property owners. Turkey offers a much friendlier tax policy than many other countries and is a good choice for foreigners who are thinking of investing in overseas property.
PROPERTY TAXES
In Turkey, foreign and local property owners pay the same taxes. When buying a home, the rate is 4% of the cadastral value of the property. If you rent out your property, you have to pay 0.3% of the rent income. In some cases, when you sell your property, you also have to pay an income tax.
PROPERTY SALE TAX
The income that a seller receives when selling a property is taxed.
The taxation of legal entities and individuals is different. According to Law No. 5520 on income tax, article 1, corporate profits are subject to corporate tax.
For individuals who own a property for more than 5 years, sales tax is not provided. However, when buying and selling a home, a seller and a buyer pay a tax of 4% of the cadastral value of the property in equal shares.
If the property is owned for less than 5 years, a seller must pay a tax on the difference between the price indicated in the TAPU and the new value, which is determined by the commission and indicated in the new TAPU. The size of the tax in 2020 varies between 15 - 40%. It is important to notify the authorities that you sell your property within 15 days from the date of the transaction. According to tax rates in 2020, the difference between the costs of up to 22,000 lires is not taxed. If this amount is exceeded, a seller will be required to pay an income tax.
When lowering the size of income from a property sale, the authorities have the right to conduct their own property assessment and determine the amount of income based on the results of this assessment.