Main Taxes on Buying Property in Turkey
In the summer season a lot of foreign customers are coming to buy property in Turkey, and they are asking about the buying procedures and the taxes required for buying a house in Turkey, actually the property taxes in Turkey has two types, there are taxes that are paid only once and other taxes are paid on yearly basis, in this article we will be featuring the different types of Property Taxes and how they are calculated.
The Title deed Tax
The title deed is the official paper that proves the ownership of the property, and also it is used to transfer the ownership of the property from one person to another, once you receive the title deed document of the property on your name, this means that this property is officially yours. The title deed is known as the TAPU document in Turkey, and it is issued from the TAPU office in the area were the property is located in.
The tax required for issuing the title deed document for the property is calculated as 4% from the total property price that is written in the contract and it is divided between the buyer and the seller, we as Nevita INT are paying half the tax and our customers are paying the other half.
VAT Exemption for Real Estate Foreign Buyers
The Value added tax is only required for the brand new property, for example if someone is buying a property in a new project directly from the developer, the buyer should pay the value added tax, the value added tax has no fixed tax percentage but it differs from one project to another depending on the project location, moreover it also differs regarding the property type, for example the value added tax is generally between 1% to 8% for the residential projects and for the commercial units the tax is between 1% to 18% depending also on the shop location, the Turkish government in order to encourage the foreign real estate investment they decided under some conditions to exempt the foreign buyers from paying the Vat tax, those conditions are as follows:
1- The buyer shouldn’t have residency permit in Turkey.
2- It can’t be implemented to second hand apartments or commercial units, it can be only for new apartments from developer to buyer.
3- All money transfers should be from buyer to seller through banks as USD, EURO or other currencies (not Turkish lira).
4- Buyer can buy as much as units with VAT exemption without any limitations.
Yearly Property Tax
The yearly property tax is mandatory and it is paid once a year, this tax is paid for the government services like street maintenance and the public gardens and similar services, the tax rate varies from one city to another, in Turkey the cities are generally divided into big cities and small cities, the yearly property tax is calculated due to the city size for example Istanbul is considered a big city and the taxes are 0,2% from the total value of the residential property.
| Property | Big Cities Tax | Small Cities Tax |
| Residential | %0,2 | %0,1 |
| Commercial | %0,4 | %0,2 |
| Farms | %0,2 | %0,1 |
| Lands | %0,6 | %0,3 |
Mandatory DASK Insurance
In Turkey when you buy an apartment there is mandatory insurance for earthquakes and natural disasters, this insurance is issued from any insurance company and sometimes from some tourism companies, this insurance is called DASK in Turkey and it is also required to apply for different services, like the electricity for your apartment, the DASK is paid once every year and it is usually a small amount of money.
Monthly Fee Paid in the Residential Complexes
There is a monthly fee that is paid in the residential complexes and it’s called Aidat in Turkey, it is paid in the management office inside the complex, and it is paid for the services and maintenance inside the complex, the tax varies between 1 to 9 Turkish lira per square meter, which means that if your apartment is 150 m2 you will be paying 150 Turkish lira each month, and this fee is also paid for the facilities provided in the residential complex, like swimming pools, gyms, playgrounds and green areas.
