TÜRKIYE Law and Practice Contributed by: Serkan Gül, Nazım O Kurt and Türkay Avanaş, Hergüner Bilgen Üçer Attorney Partnership
7.6 Liens or Encumbrances in the Event of Non-Payment Contractors are entitled to request the registra - tion of a mortgage over the land to guarantee their receivables. Owners may request removal of the mortgage upon fulfilling their obligations
8.2 Mitigation of Tax Liability Methods such as division, mergers, share trans - fers, etc are used in order to benefit from mutu - al tax agreements and exemptions. Moreover, REIFs and REICs are exempt from corporate income tax. These structures can also be used There is no periodic tax applicable for the occu - pation of business premises. However, a fee determined by municipalities is paid to obtain and renew operation permits. There is no spe - cific exemption for operation permit fees. Moreover, real property tax is paid to munici - palities. The municipalities determine this tax according to the value of the respective lands. There are no significant exemptions for busi - nesses with respect to real property tax. 8.4 Income Tax Withholding for Foreign Investors Income generated by foreign investors that are not resident in Türkiye is subject to withholding tax (eg, 20% for rental income). Rental income is subject to income tax for real persons and cor - porate income tax for companies. The income tax applicable for real persons varies between 15% and 40% depending on the rental amount and TRY47,000 (applicable for year 2025) of the rental income from residences is exempt from income tax. Corporate income tax is paid on the rental income generated by limited liability companies and corporations. General corporate income tax is currently 25%. to mitigate tax liability. 8.3 Municipal Taxes There is no general tax exemption for income tax and corporate income tax accrued on rental income. However, if rental income is generated by a REIF or REIC, the relevant income is exempt from corporate income tax.
under the construction agreement. 7.7 Requirements Before Use or Inhabitation
An occupancy permit certifying that the con - struction has been completed in accordance with the official designs (projects) should be obtained before a project is inhabited or used for its intended purpose.
8. Tax 8.1 VAT and Sales Tax
Sale of land within the scope of a commercial enterprise and land owned by limited liability companies and corporations is subject to VAT. The generally applicable VAT rate for land sales is 10%. However, the VAT rate applicable for sales of flats generated from urban regeneration that are up to a net area of 150 square metres is 1% and for those that are 150 square metres or higher is 20%. The VAT rate applied to other sales of flats that are up to a net area of 150 square metres is 10% and to those that are 150 square metres or high - er is 20%. VAT is paid by the purchaser. The sale of lands held by limited liability compa - nies and corporations for more than two years is exempt from VAT. However, this exemption does not apply to limited liability companies and cor - porations that conduct real estate business.
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