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Tax on Revenue From Real Estate (paid by both residents and non-residents)


    This is related to the profit made by a foreign real estate investor on the sale of real estate and the rental of his or her property in Turkey. The rates of taxation range from 15% to 30%. As of now, Turkey does not give income tax exemption if the money is re-invested in another property. Taxes of this kind are divided into two categories: 

1. A capital gains tax on the profit gained on the sale of a property:

    The gap between the ‘declared amount’ of the property on sale and the ‘declared amount’ of the property on purchase is used to determine the gain. To give an example, if you bought a real estate property in Turkey in 2010 for 100,000 € (and the amount declared on title deed transfer upon which you paid your stamp duty was 60,000 €) and sold it in 2013 for 130,000 € (amount declared on sale was 80,000 €), you made a profit on sale of 20,000 €. As a result, you will be taxed upon 20,000 €. The tax band begins at 6,000 Turkish Liras, and capital gains below this amount are not taxed. Up to 40,000 ₺, the tax rate is roughly 23%, and over that, it rises to 35%.

Please keep in mind that after 5 years of ownership, capital gains tax is set to zero. In other words, if you have held your property in Turkey for at least 5 years, you will not have to pay any capital gains tax.

2.A tax on the income obtained from the property (such as rental income):

    After deducting permissible expenditures against revenue, such as maintenance and some wear and tear, the income generated from your Turkish real estate becomes the taxable amount. This amount is subject to an annual exemption level, after which the tax brackets begin at 15% and escalate to 35% for net income over 40,000 ₺.

    How does Turkish income tax make life easier for the foreign individuals?

Russia: Not very favorable for landlords, tenants can terminate a lease with three months notice regardless of the length of the agreement 

Austria: Non-residents pay a huge amount of property tax

France: A complicated and unfamiliar text code with regard to rental income

Panama: Property tax sees rise in parallel with the present value of the property

Switzerland: Strict taxing procedures for landlords (rental income tax corresponds to %54.5)