Being able to invest in real estate is undoubtedly one of the goals of most people. Owning a home is good, but there are also requirements. For example, there are taxes paid for housing that landlords pay at certain times and conditions. The presence of a tenant in the house does not affect the tax liability, these taxes are always paid by the legal owner of the house.
Houses located within the borders of Turkey are taxed under the Real Estate Tax Law No. 1319. The same tax is collected from houses, workplaces, plots and lands. While the taxes to be paid when buying a house are only once, there are also tax items that must be paid periodically in the later period.
Property Tax
Valuable housing tax
Rental Income Tax
Capital Gains Tax / Real Estate Appreciation Gain Tax
Environmental cleaning tax
Let’s have a look at them :
Property Tax is the type of tax that all real estate owners are obliged to pay. All buildings, plots, and lands in the country are subject to property tax. Real estate owners who buy land or building must make a real estate declaration. The real estate tax fee is determined by taking into account the real estate declaration. The real estate tax amount is recalculated every year over the current value of the real estate.
First time paying the property tax?
If you are going to pay the property tax for the first time, you must go to the municipality where your property address is located and apply in person. Documents required when applying:
- Deed copy
- Copy of building occupancy permit for the building
- Address of the building (neighborhood, street, and door number)
- Owner’s residence and land address
- Owner’s tax number and ID
When you go to the municipality with your title deed photocopy, you must fill in the application form and submit it to the relevant persons. After this application, you have to pay your tax twice a year.
If you have just bought your home, you will start paying property taxes one year after you move in.
How is the Property Tax Value Determined?
The real estate tax is calculated by applying a “revaluation rate” to real estate subject to real estate tax every year. This calculation is made by the municipalities to which the residence is affiliated.
The revaluation rate to be applied for the 2022 tax period is determined to be 18.10%. This rate changes yearly.
The property tax rates:
Property tax rates are regulated in Articles 8 and 18 of the Property Tax Law enacted in 1970. The rates in the relevant laws are given in the table above. The rates in the table are applied to the property tax value of the real estate determined by the valuation commission operating within the municipalities.
Proerty Type Outside Metropolis Inside Metropolis
Residence 1/1000 (0,001%) 2/1000 (0,002%)
Other Buildings 2/1000 (0,002%) 4/1000 (0,004%)
Land 1/1000 (0,001%) 2/1000 (0,002%)
Plot 3/1000 (0,003%) 6/1000 (0,006%)
Calculation example:
- Let’s assume that the property tax value in 2021 for a residence in Istanbul acquired in 2020 is 200.000 TL
- Revaluation rate to be applied for the 2022 tax period: 18.10%
- Revaluation amount: 200.000 TL * 18.10% = 36.200 TL
- Property tax fee for 2022: 200.000 TL + 36.200 TL = 236.200 TL
- Note: Since fractions up to a thousand lira are not taken into account, the taxable amount will be considered as 236,000 TL.
- Since it is located within the Istanbul border, in the Metropolitan Municipality, and is a residence, 2 per thousand of the value of the house found according to the revaluation will be calculated as property tax: 236,000 TL* 0.002% = 472 TL is the total property tax to be paid.
Who Is Exempted From Property Tax?
Property tax is not collected from state-owned buildings, places of worship, agricultural business buildings, army houses, military casinos, dams, consulates, and embassies belonging to foreign states. In addition, some real estate owners are not obliged to pay property tax. Housewives, relatives of martyrs, veterans, widows, unemployed, or retired persons are exempt from property tax.
Where can I pay the Property Tax?
Since the real estate tax payments are made directly to the municipality to which the residence is affiliated, it cannot be made through the applications of the Revenue Administration or the website. In addition, unless the municipality has a special agreement, no payment can be made on banks (there is a list of contracted municipalities on the banks’ websites). Apart from bank agreements, payments can only be made via credit card or cash on the website and cashiers of the relevant municipality. In addition, some small municipalities may not be able to make payments through their website.
Property tax payments can be made annually in one or two installments. The first installment of the property tax is in March, April, or May; The second installment is paid in November.
Valuable Housing Tax (DKV), which came into our lives with Law No. 7194 and was implemented for the first time in 2021, will also be applied as of 2022.
What is the Subject of Tax?
The subject of DKV is residential properties located within the borders of Turkey and the building tax value exceeds a certain amount. For the year 2022 is this value determined from 6.173.000 TL as the property value.
What should be understood from residential real estate?
Residential real estate refers to each independent section in residential buildings and buildings consisting of more than one independent section. Each independent section will be evaluated separately in terms of taxation. In the evaluation of whether the immovable has the characteristics of a dwelling or not, the actual usage status of the immovable as well as its quality in the title deed records will be examined.
Who are the Taxpayers of DKV?
The taxpayer of this tax is the owner of the residential immovable, the usufruct owner if any, and the people who dispose of the residential immovable as the owner, if both are not available.
Owners of residential real estate are liable in proportion to their shares, while in joint ownership, the owners are jointly and severally liable for tax.
Is exemption from DKV possible?
the following residential properties are exempt from valuable housing tax:
a) Residential immovables, owned or owned by the general and special budget administrations, municipalities, universities, and the Housing Development Administration.
b) For those who own a single residential immovable and have more than one residential immovable within the borders of Turkey, the lowest valued single residential immovable is subject to the valuable house tax (including the right of usufruct) (This provision states that the specified persons must own a single dwelling with a share. It is also applied to the portion belonging to the shares.)
c) Residential immovables belonging to foreign states and used as embassies and consulates, residential immovables for the residence of ambassadors and their outbuildings (provided that they are mutually exclusive), and residential immovables belonging to international organizations headquartered in Turkey and representative offices of international organizations in Turkey.
ç) Newly built residential immovables (including residential immovables that are left to the contractor who undertakes the contracting work in return for land) which are registered in the businesses of those whose main field of activity is building construction and which have not yet been subject to the first sale, transfer or assignment (lease of these immovables or except in cases where it is used in any other way).
What is the Valuable Housing Tax Tariff for 2022?
The valuable housing tax tariff in 2022 starts from 6,173,000 TL. Therefore, owners/usufruct holders/savers of residential properties whose real estate tax value for 2021 exceeds 6,173,000 TL and meets the conditions specified in the law are liable to pay this tax.
The lower and upper limits (base) of the residential real estate subject to the valuable housing tax to be applied in 2022 are determined as follows:
3/1000 (0,003%)
For those between 6.173.000 TL and 9.260.000 TL (incl. this amount) for the part exceeding 6.173.000 TL
6/1000 (0,006%)
Up to 12,347,000 TL (incl. this amount) 9,261 TL for 9,260,000 TL, for more
10/1000 (0,01%)
For those with more than 12,347,000 TL, 27,783 TL for 12,347,000 TL, for more
Who determines the value of the property?
The determination of the real estate that will be subject to the valuable housing tax is made by the General Directorate of Land Registry and Cadastre or authorized valuation companies.
The owners of the real estate determined to be valuable residences are notified and announced on the General Directorate of Land Registry and Cadastre page. When a price is not determined by the General Directorate of Land Registry and Cadastre, the current value to be determined by the municipality in which the real estate is located is taken as a basis. Property owners have the right to object to the price determined by the relevant directorate within 15 days. Objections are also finalized within 15 days. Uncontested structures are subject to the valuable housing tax.
Where can I pay the Valuable Housing Tax?
Taxpayers will be able to submit their tax returns to the tax office until the end of February 20, 2022, by attaching the document showing the building tax value (related to the year the declaration was submitted and the previous year) that they will receive from the municipality of the place where the residential property is located.
The tax office where the declaration will be submitted is the tax office of the place where the immovable is located.
Rental income tax is a type of tax you have to pay if you rent out your home. If you have a house but not rented, you do not have to pay. This tax, like the property tax, is paid twice a year. The annual rental income from the house is decisive for the amount of rental income tax.
The exemption amount for 2022
If your annual income from rent is lower than the rental income tax exemption amount announced by the Revenue Administration every year, then you will be exempt from paying taxes. Housing rental income exemption amount in 2022 has been determined as 9,500 TL.
What are the tax brackets for 2022?
Up to 32.000 TL, 15%
for 32,000 TL of 70,000 TL to be paid 4800 TL, 20% for the excess
for 70.000 TL of 170.000 TL to be paid 12.400 TL, 27% for more
for 170,000 TL of 880,000 TL to be paid 39.400 TL, 35% for the excess
for 880.000 TL of more than 880.000 TL to be aid 287.00 TL, 40% for more
Where can I pay the rental income tax?
You can pay your rental income tax through tax offices. You can visit the website of the Revenue Administration to make online payments or inquire about debt.
Capital Gains also called Real Estate Appreciation gains are the type of tax that must be paid if a purchased house is sold within five years from the date of purchase.
If you are selling the house you own at least five years after the date you bought it, then you do not have to pay this tax. The date taken as a basis in the operation of the 5 years is the title deed transfer date.
The only exception is if the real estate is acquired through inheritance or donation.
What is Capital Gains Tax?
Capital Gains Tax is a type of tax collected from the seller of the real estate. A property may increase in value within 5 years from the date of purchase. For example, if the value of a house shown in the title deed is 100,000 TL, its value may increase to 150,000 TL in new transactions. Due to this difference between the old value and the new value, the seller of the real estate pays Capital Gain Tax. The purpose here is to collect the tax on the income obtained from the sale of the residence or any real estate.
How is Capital Gains Tax calculated?
The purchase value of the real estate is adjusted for inflation and the real estate value is found according to today. The difference between the real estate purchase value corrected for inflation and the real estate sales value is calculated and the “real income” obtained independently of inflation is found. The exemption amount announced every year (for 2022 it is 25.000 TL), the title deed fee paid at the time of sale and, if a housing loan is used, the sum of the interests paid until the sale of the house is deducted from this income, and the “taxable amount” is found. The “tax payable amount” is calculated by applying tax brackets to the taxable amount found.
Tax brackets for 2022
up to 32.000 TL,15%
Between 32.000 TL – 70.000 TL, 20%
Between 70.000 TL -170.000 TL, % 27
170.000 TL – 880.000 TL , 35%
Over 880.000 TL, 40%
How is the adjustment of the purchase value for inflation made?
Capital Gain Tax is calculated according to the Yİ-ÜFE rates announced by TURKSTAT (Turkish Statistical Institute). Yİ-ÜFE stands for Domestic Producer Price Index( Yurt İçi Üretici Fiyat Endeksi). Yİ-ÜFE rates are the rates that are announced every month. However, the rates of the previous month are taken into account when calculating. The tax in question is calculated by calculating data such as the purchase price, purchase date, sale price and sale date of the real estate, and expenses.
Where can I get help to learn the tax amount?
The approximate tax amount can be learned from the online capital gain tax calculation tools. The Revenue Administration can be contacted for problems related to the Capital Gain Tax collected under Article 80 of the Income Tax Law. Information about official transactions can be obtained by contacting the call centers with the number “189” or “444 01 89”.
What are the payment methods for Value Addition Tax?
Capital Gains Tax is collected annually in two terms. The tax, which is paid in 2 equal installments in May and July of each year, can be paid online via the website of the Revenue Administration by credit card or debit card. However, the payment can only be taken from the cards of the banks that have an agreement with the Revenue Administration. In addition, payments can be made through internet banking or mobile branch platforms of contracted banks. Again, Capital Gain Tax can be paid in branches of contracted banks and all tax offices.
For what type of real estate is the Capital Gains Tax paid?
According to the statements made by the Revenue Administration, “Land, buildings, mineral waters, spring waters, mines, quarries, sand, and gravel extraction sites, brick and tile blends, salt mines, vol areas, and dalyans, rights registered as real estate, ship, and ship shares and motorized loading and unloading vehicles are obliged to pay Capital Gain Tax.
When you buy a house, the municipality asks you to pay the environmental cleaning tax, also known as the garbage tax. Environmental cleaning tax; If the house is not rented, the landlord pays, and if it is rented, the tenant pays. Therefore, if you have a tenant in your home, you are exempt from this tax. Because the environmental cleaning tax of the houses is reflected on the water bills.