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Foreign nationals and Turkish citizens are no
different in terms of the taxes or levies charged.
Tax rates are updated periodically.
The rates as of January 1st 2005
are shown below. Updates and other relevant information
can be found at at www.maliye.gov.tr .
i) Real Estate Tax: Annual Real Estate Tax rates for
cultivated land, uncultivated (for building) land, non-residential buildings, and residential buildings are
0.1%, 0.3%, 0.2%, and 0.1%, respectively.
Tax is calculated on the basis of the declared value of the asset,
which cannot be less
than the threshold determined by
the tax authorities. Tax payments are
made in two equal instalments during the periods
of March-May and November each year and are collected by local government
authorities
(municipality). The tax base is updated
annually by a coefficient
determined by the Ministry of Finance, taking into account the
inflation rate.
However, Real Estate Tax rates for properties in the
following provinces (metropolitan areas)
are twice the normal rates
stated above.:
• Adana
• Ankara
• Antalya
• Bursa
• Diyarbakir
• Erzurum
• Eskisehir
• G.Antep
• Icel
• Istanbul
• Izmir
• Kayseri
• Kocaeli
• Konya
• Samsun
ii) Real Estate Sale-and-Acquisition Levy:
Both buyer and seller
have to pay a Real
Estate Sale-and-Acquisition
Levy of 1.5%, based on the declared value
of the asset. This is collected by the
Local Title Deeds Registry Office at the time of the selling/buying
transaction.
For the registration of a new
building constructed on land, a levy of 1.5% based on the reference
value of the asset must be paid.
In
the case of the acquisition of sea-side,
river-side and lake-side properties which are subject to special
permission, an acquisition levy of 126%
must be paid.
iii) Inheritance and Succession Tax: The
tax base is updated annually. There are some discounts for
legacies to daughters, sons and spouses. In
the case of spouse and
children, YTL 75,719 is deducted from the tax base of each person.
In the case of a spouse with no children,
the deduction from
the tax base is YTL 151,526. In the case of succession
without reciprocity the amount deducted is YTL 1,748.
As of 1st January 2005 the applicable tax base
and rates are as follows:
|
Tax Base
(Value of Asset, in YTL) |
Inheritance Tax Rate |
Succession Tax Rate
(No Reciprocity) |
|
|
|
|
First 120,000 |
1% |
10% |
|
Next 260,000 |
3% |
15% |
|
Next 550,000 |
5% |
20% |
|
Next 1,100,000 |
7% |
25% |
|
Amounts exceeding 2,030,000 |
10% |
30% |
iv) Environmental Services Tax (EST):
Local water suppliers charge an EST of
0.12 YTL per one m3 of
water used to residences. It varies between 12
YTL and 1,400 YTL per year for
other building
classifications. The rates for metropolitan
cities, however, are 25% higher than
the normal rates. These
figures are updated annually. The rate of
EST will be reflected in your water bill.
v) Motor Vehicle Tax: Depending on the cylindrical volume of
the engine
and date of production of the vehicle, vehicle owners have to pay
an annual tax ranging between YTL 22.00 and YTL 22,240.00 (For
Automobiles, it is from YTL 22 to 667 but for aircraft, it is from YTL 2,668 to YTL 22,240)
vi) Corporate Tax: Corporate entities have to pay a tax of 30% of
their previous year's profits.
vii) VAT: The general VAT rate is 18%. However, some
specific goods and services
are taxed at either 1% or 8%.
viii) Special Consumption Tax (SCT):
Levied on luxury goods and those goods which have
an effect on the environment, security
or health,
including:
• Fuels, industrial oils, petroleum products and petro-chemicals,
• Motor vehicles and sea vehicles,
• Beverages and products with tobacco
• A number of goods including caviar, perfumes, some
make-up/cosmetic products, printed materials, some electrical and
electronic devices
ix) Stamp Tax: There is a wide range of transactions on which a
Stamp Tax is charged. Some important items and the corresponding
rates are depicted below:
| Contracts with monetary clauses: |
0.75% of the value stated |
| Tenancy Contracts: |
0.15% of the rental fee |
| PLCs and
LTD contracts: |
0.50% of the value stated |
| Wages: |
0.60% of the wage |
| Advance Payment Receipts: |
0.60% of the value stated |
x) Personal Income Tax:
The Personal
Income Tax
rate is
updated by a Council of Ministers' Decree every year.
The main taxable
personal income items are commercial income, agricultural
income, wages, self-employment revenues, rent, interest and other
incomes. Personal income tax rates on wages for the year 2005 are
shown in the table below.
|
Cumulative Income in YTL |
Income Tax |
| Lower Limit |
Upper Limit |
| 0 |
6,600 |
20% |
| 6,600 |
15,000 |
25% |
| 15,000 |
30,000 |
30% |
| 30,000 |
78,000 |
35% |
| 78,000 |
- |
40% |
However, Personal Income Tax on wages for each slice of
the above tax base is 5 percentage points lower than the
percentages shown in the above table.
xi) Minimum wage: In the year 2005,
the minimum gross wage for 30
days is 488.7 YTL for employees aged
16 or more (The cost
to the employer is YTL 593.77).The minimum
wage is applied nation-wide and reviewed periodically.
xii) Social insurance: In accordance with Turkish social security laws,
the self-employed and farmers, employees and civil servants have to
register to Bag-Kur, SSK, and Emekli Sandigi, respectively. These
are compulsory schemes.
Contribution rates for these schemes range between 35% and 40% of
the contribution base. The main risks covered by these schemes are
old-age, disability/invalidity, health, maternity, mortality,
being orphaned or widowed, unemployment (for the employed).
The minimum retirement
age for new entrants is 58/60 (F/M).
xiii) Earthquake Insurance: Property must
be insured by the owner against earthquake risks. It is compulsory and a national
uniform tariff is implemented.
xiv) Motorists Insurance: If you possess a car, you are
obliged to obtain Motorists (traffic)
Insurance. The cost of
the policy depends on
the cylindrical volume of the engine and the production date of the
vehicle.
Decoration and Furnishing
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