INFORMATION ABOUT THE TRANSFER TO BE MADE TO PURCHASE THE REAL ESTATE

1. Sale price must be deposited to the bank account of the seller or the seller’s authorized representative through such means as money transfer, EFT etc. by the purchaser or the purchaser’s authorized representative and must be documented.

2. For real estates owned by public institutions and enterprises, such as TOKİ and Emlak Konut, the transfer/payment of the price may also be evidenced by a certified bank receipt or official letter showing the amount received

3. Investment amount can be paid through investor’s personal account abroad or Turkish account to developer’s account. Investment money should be directly transferred from investor’s personal account.

4. If investor cannot directly transfer from his personal foreign account, we recommend to open an account in Turkey and transfer investment money to your bank account in Turkey. Lawyer can open a bank account with power of attorney or can assist investor and be present to open a bank account in Turkey.

5. Investment money also can be paid to branch that developer’s account is hold by lawyer or investor itself. In this case, different explanation should have be written to cashier.

6. The US dollar value of the property shall be calculated based on the amount stated at real estate value assessment report and the effective USD selling rate and / or cross exchange rate of the Central Bank of the Republic of Turkey on transaction date.

THE TITLE DEED COST BUYER RESPONSIBLE FOR

1.Title deed tax is % 4 of sale price. Legally buyer has to pay only %2 of the sale price. However, this conditions may depends on the negotiation.

2.Revolving fund fee which is another type of tax charged by tax office, at the amount of 1600 TL in 2021.

3.Evaluation report fee between 1500- 2000 TL.

4.If the project is new , opening facility fees, approximately 5.000 TL

5.Vat- if property is residential unit and first hand %1 of the sale price is paid as vat which is most of the time included in the sale price. Please check with the owner. If property is qualified as commercial unit % 8 or for some luxury projects it is % 18 of the sale price is paid as vat.

Tax Liabilities After Buying Property

Local property tax is payable in two equal instalments, the first in May and the second in November. You have to contact your local municipality (Belediye) for further information and payment options. Tax is calculated based on the value of the property and is subject to thresholds set by the tax authorities as follows:

For real estate located inside of a metropolitan municipality area:

• Residences 0.2%
• Other buildings 0.4%
• Land 0.2%
• Vacant land (but allocated for construction purposes) 0.6%

For real estate located outside of a metropolitan municipality area:

• Residences 0.1%
• Other buildings 0.2%
• Land 0.1%
• Farming land 0%
• Vacant land (but allocated for construction purposes) 0.3%

VAT Exemption on Purchasing a Real Estate

Effective from 1 April 2017 – except for cases mentioned in Article 3 first paragraph sub-paragraph 2 of the Turkish Income Tax – any deliveries of houses and workplaces to (i) Turkish citizens living abroad for more than 6 months by obtaining a work permit or residence permit, (ii) foreign individuals not permanently residing in Turkey, and (iii) institutions whose legal residences and headquarters are not located in Turkey and which are not earning any profits in Turkey by virtue of a workplace or any permanent representative are exempted from VAT provided that such exemption is only applied to the first delivery of the houses and workplaces falling under the mentioned exemption and foreign currency is brought into Turkey in return to such delivery.

Every buyer has to pay Vat if the property has not been sold to any party before. In other words, if property is first-hand and kept by the developer, buyer has to pay Vat which might be %1, %8 or %18 depending on the property status

But Foreign citizens and Turkish citizens who reside in foreign countries who purchased a real estate are VAT exempted.

The below conditions should be fulfilled in order to benefit from the VAT exemption:

• Only the new real estate properties purchased from construction companies are included. In other words, second-hand purchases are not in scope of the exemption.
• The real estate must be purchased in foreign currency.
• The purchased real estate cannot be sold within a year following the purchase date. In case the real estate is sold within a year, the exempted VAT will be collected.

DOCUMENTS REQUIRED FOR OBTAINING

TAX EXEMPTION

• Obtain residency certificate from a country where buyer resides

• Acquire a letter from immigration office in Turkey in respect of a buyer is not settled in Turkey

• Acquire a letter from police department showing arrival and departure dates of a buyer

• Acquire letter from tax office that proves buyer is not settled in Turkey