What are the taxes when buying real estate in Turkey?

Taxes on property acquisition in Turkey

Taxes associated with the purchase of real estate in Turkey amount to 1.65% of the price indicated in the tapu, which is the title deed. These tax obligations are shared between the parties involved in the transaction—the buyer and the seller—resulting in a total tax burden of 4%. This one-time tax obligation is paid at a state bank and is made in the local currency, Turkish lira, at the time of receiving the tapu documents.

The tax conditions remain the same for both Turkish citizens and foreigners, although the rates may be subject to annual review. For example, during 2011-2012, the property transfer tax did not change, but starting in 2012, there was an increase in other taxes of about 10.26%.

Additional financial obligations

Additional financial obligations when purchasing real estate also include expenses related to the preparation and processing of all necessary documents, such as notarization, translation, and so on. These costs typically do not exceed 500 Turkish lira, which is approximately 300 US dollars.

After completing the purchase of real estate, it is important to transfer the water and electricity meters to the new owner, which will cost about 650 Turkish lira, approximately equivalent to 370 dollars. Moreover, after acquiring property in this country, it is mandatory to obtain state earthquake insurance, which costs an average of 100 Turkish lira, or about 60 dollars.

The process of buying and selling real estate

The process of buying and selling real estate is carried out through the state land cadastre or the registration office, where government officials operate. The involvement of notaries or lawyers in this process is not necessary, but for individuals who are not citizens of Turkey, a mandatory requirement is the presence of a notarized translator.

The services of this specialist can cost between 100 and 150 Turkish lira, which is equivalent to an amount ranging from 60 to 85 US dollars.

Housing maintenance expenses

As for the operating costs of maintaining housing, the annual property tax in Turkey is determined based on the cadastral value, which analyzes both the value of the land plot and the square meter of construction, taking into account regional characteristics. Typically, this tax ranges from 0.1% to 0.3% of the established assessment.

• The tax for residential real estate is 0.1%.
• The land tax without a building permit is also 0.1%.

It is important to remember that if the property tax on residential property is already being paid, then an additional tax on the land plot is not required in this case. These tax payments are made in two installments: in May and November, in equal shares.

Tax policy in large cities

It is also important to consider that in some major cities in Turkey, property tax rates can significantly increase. Such cities include:

• Adana
• Ankara
• Antalya
• Bursa
• Diyarbakır
• Erzurum
• Eskişehir
• Gaziantep
• Ichel
• Istanbul
• Izmir
• Kayseri
• Kocaeli
• Cognac
• Samsung

Potential buyers should be aware of possible differences in tax policies depending on the location of the property. This knowledge will help them plan their financial expenses properly and avoid unpleasant surprises in the future.

Mandatory payments for property owners in Turkey

Property owners in Turkey need to consider a number of mandatory payments related to taxes and monthly expenses. First and foremost, there is the annual waste disposal tax that must be paid to the local authorities. The cost of this fee varies depending on the location of the property and its size. Typically, the amount of this tax does not exceed 90 lira (approximately 50 US dollars) per year.

Expenses for general needs

In addition, owners must participate in funding the common needs of the residential complex or individual housing. These expenses may include:

• Pool operation
• Cleaning the area
• Security
• Other services

The amount of contributions is determined at the general meeting of residents and can start from 30 lira per month.

Utility payments

An equally important aspect is the utility payments for electricity and water, which are calculated based on the meter readings. On average, these expenses amount to about 230 lira (approximately 130 dollars) per month. It should be noted that the cost of water supply includes a tax from environmental services.

Taxation of rental income

It is also worth mentioning the income tax on rental income. If the owner's annual rental income is less than 3000 lira (about 1700 dollars), no tax is applied.

Conclusion

In conclusion, buying property in Turkey involves not only a joyful event but also certain financial obligations that should be carefully considered. Learning about the taxes and fees that arise during the process made me realize how important it is to prepare for these expenses in advance.

Tax on purchase, amounting to1.65%The cost shown in the estimate, along with additional expenses for document processing and preparation, can significantly impact the overall budget.

I noticed that, unlike many other countries, in Turkey there is no need to involve notaries or lawyers, which simplifies the process; however,mandatory presence of a notarized translatorFor foreign buyers, this can come as an unexpected additional expense. After purchasing real estate, it is also important to consider annual taxes, which depend on the location and type of property, as well as various utility and maintenance fees. These costs can significantly impact the owner's financial situation, especially if the property is intended for rental purposes.

Taxes on rental income

It is necessary to take into account the income tax from rental income. I found out that if the annual rental income is less than3000 Turkish liraNo tax is levied, but if it exceeds a certain amount, a percentage of the income will need to be paid. Real estate sellers should also be attentive to tax obligations related to profits from sales, as for properties owned for less than...5 yearsThe tax can significantly increase costs.

Key points of buying real estate in Turkey:

• The tax on purchasing real estate is 1.65% of the price.
• Additional processing fees may amount to up to 500 lira.
• It is necessary to transfer the meters to the new owner.
• It is essential to have government insurance against earthquakes.
• The annual property tax is 0.1-0.3% of the cadastral value.
• The rental income tax is not charged for income less than 3000 lira.
• The profit tax on sales is 15-35% for owners with a holding period of less than 5 months.

Therefore, before making a decision to purchase real estate in Turkey, it is important to carefully study all tax aspects and additional expenses. These details may seem insignificant at first glance, but ultimately they can significantly impact your financial situation and overall enjoyment of property ownership. Pay attention to the need for proper planning and consideration of all possible costs. This will help you avoid unpleasant surprises and make the purchasing process as comfortable and successful as possible.