Navigating the Turkish real estate market can be exciting whether you are buying or selling. Having the right agents support you in the process eases any confusion you may have from operating in a system new to you when you are ready to sell.
Since January 2020, sellers or agents have to apply to a private real estate valuation company to calculate the real market value of their property. 4% of the real value will be paid in tax based on the valuation/sale. Appraisals cost around 500 TL which is paid for by the seller, this is then shared with the TAPU office and is valid for three months. The real market valuation is based on sale prices of other homes in the area that is similar to yours in terms of number of rooms, land, square footage, etc. The appraised value is established by location, size and condition of the home as well as any improvements that were made.
The Valuation covers the following information:
– Title deed details
– Map of the location of the property with coordinates
– Property photos
– Example prices of similar properties
– Confirmation of the price
– Notes on the debt condition of the property
–TAPU and cadastre general directorate approval
At the same time any foreigner purchaser or seller who is not a work permit or resident holder must obtain an identity number (yabanci kimlik number that starts with 99) to make the sale or purchase. Deed transactions can be carried out without the two parties meeting in person from different TAPU offices. To sell your property you will need your original passport (translated and notarized copies), Turkish tax number, four passport sized photos of the buyer and seller, the DASK policy and the title deed. If you do not speak Turkish, you are required to hire a sworn translator. The local municipality sets the official evaluation and by law the title deed sale transfer fee is payable by both parties, 2% from the buyer, 2% from the seller (although in practice the buyer usually pays the full 4%). The TAPU office then prepares all the paperwork for the transfer. There are some small administrative taxes associated with this process.
According to Turkish Income Tax law there may be a capital tax gain fee when you sell Turkish properties. This tax is based on the increase in value and how long the property was owned and is only payable on the profit from the sale of a property sold within five years of ownership based on the land registry (TAPU) date stamp. Properties that were owned less than five years are subject to the tax while sales of properties owned more than five years’ profit is not recognized as an appreciation gain and the tax is only paid on the profit not total sales figure. Under Article 80 of the Income Tax law, there is no tax exception for real estate bought and sold within five years with the exception of inherited and donated properties. These properties are subject to value increase tax and you must submit a declaration to the government to calculate the tax.
The capital gains tax rates are similar to the Income Tax Rates of Turkey and are calculated as a percentage of the profit between the declared value of the property at time of purchase and the sale price registered at the TAPU office.
|For Profits|| Capital Gains Tax (Percentage)|
|Lower than 6000 Turkish Lira (TL) ||No Capital Gains Tax|
|Between 6000-7000 TL|| 15%|
|Between 7000-18000 TL ||25%|
|Between 18000-40000 TL ||27% |
|Over 40000 TL ||35%|
Retaining ownership of properties valued over $400,000 over five years not only gives you a tax break but has the added benefit of Turkish citizenship by investment.