Real Estate Taxation for Foreign Investors in Turkey

Turkey has become an attractive real estate market for foreign investors. However, one of the most critical aspects of property ownership is understanding the taxation system. Below is a comprehensive guide to taxes and exemptions applicable to foreign property buyers in Turkey.

. Taxes at the Time of Purchase

• Title Deed Transfer Tax (Tapu Harcı): 4% of the property’s sale price, usually shared equally between buyer and seller.

• Value Added Tax (VAT): Ranges between 1% and 20%, depending on property type, size, and project license date.

• Notary & Translation Fees: Additional costs for document certification and translation.

2. Taxes During Ownership

• Property Tax (Emlak Vergisi): Annually between 0.1% – 0.3% of the property value; doubled in metropolitan municipalities.

• Environmental Cleaning Tax: Collected annually by municipalities.

• Rental Income Tax: Foreigners must declare annual rental income. For 2025, incomes above 21,000 TL are taxable.

3. Taxes at the Time of Sale

• Capital Gains Tax: If the property is sold within 5 years of purchase, profits are subject to income tax. Sales after 5 years are tax-exempt.

• VAT Exemption: Foreign buyers who have not resided in Turkey for more than 6 months and pay in foreign currency may benefit from VAT exemption on their first property purchase.

4. Double Taxation Treaties

Turkey has agreements with many countries to prevent double taxation, allowing investors to avoid being taxed both in Turkey and their home country.

5. Importance of Professional Guidance

Tax rules and exemptions can change over time. Foreign investors are strongly advised to consult with a tax advisor or certified accountant to ensure compliance and optimize their investment.

Looking to invest in Turkish real estate? Let our experts guide you through tax regulations and exemptions.