Standard VAT rate: 18%
Real-time reporting: mandatory
Digital service tax: yes
Turkish VAT number format is 10-digit taxpayer identification nuber. If the company name starts with A, the first digit is 0; if starts with B, it is 1; if it starts with Y or Z it is 9, hence fort.
The standard VAT rate in Turkey is 18%, with reduced rates of 8% and 1% on certain goods and services.
18% (Standard) – Applies to all taxable supplies, with certain exceptions
8% (Reduced) – Some existential foodstuffs, pharmaceutical products, books (excl. e-books)
1% (Reduced) – Some existential foodstuffs, newspapers and periodicals
0% (Zero) – Exportations
Every taxpayer who is issuing invoices is obliged to submit a VAT declaration. Declarations are submitted electronically, via https://ebeyanname.gib.gov.tr/index.html portal.
Monthly – VAT return should be submitted until 26th of the following month.
If the taxpayer has the amount to pay ready, they should pay to the tax office monthly, immediately after the declaration(no later than 26th of the following month).
If the taxpayer owes tax, it is not refunded, but accumulated to next reporting month.
There are 4 types of penalties envisaged by the TP Law:
For the entities who avoid, do not comply with the preservation and submission duties of the Tax Procedure Law and those who do not comply with the obligation of electronic notification and declaration, following penalties will apply:
A special irregularity penalty of 5% of the amount subject to the transaction is reduced for each of the taxpayers who do not comply with the obligation to verify their collections and payments with documents issued by banks, similar financial institutions or postal administrations.
Invoices must contain at least the following information:
As of January 2020 paper invoices are not legally valid and it will be mandatory to use electronic invoices.
The E-arşiv Fatura is the electronic invoice that businesses must send all customers not logged in the TRA. Companies must send these invoices to recipients electronically.
E-Irsaliye or e-deliveries must be declared over the TRA portal by businesses obliged to invoice electronically.
Companies that want to invoice in Turkey must sign up to the TRA using their VKN tax ID code. They also have to complete a number of documents published on the government portal. Their tax advisors will determine exactly what information to send.
Companies must have the digital certificate of an individual and an electronic seal of the company and file their articles of association with the firm’s Notary.
Mandatory for everyone as of Jan 2020.
Once authorized by the TRA, companies submit invoices in UBL-TR 1.2 format over the TRA portal. The process is automatic and immediate if you use invoicing platforms. E-invoices have to be securely archived for 10 years to ensure long-term document integrity. That is why it is necessary to digitally sign stored documents in line with the XADES standard.
Services subject to the digital services tax include:
Persons subject to the digital services tax (that is, the taxpayer) are those that, either individually or on a group-wide basis, meet both of the following conditions in the calendar year before the year when the taxable revenues are obtained:
The rate of the digital services tax is 7.5%, but the president has authority to reduce this rate downward to 1% and to increase the rate of up to two-fold the applicable rate of 7.5%.
The tax base of the digital services tax is the amount of revenue obtained from the digital services during the relevant tax period. No deductions are available for expenses, costs or tax.