Update : 08.03.2017
Foreigners who do not settled in Turkey and the companies which have not an office in Turkey or institutions that don’t make profit in Turkey will not pay (%18) VAT on the first purchasing of office and residence provided that they pay the foreign currency to be obtained from abroad. By taking advantage of VAT exemption, the people who purchased residence or business office in Turkey will not be able to sell these real estate for a year, and if they sell these houses and business offices within one year, the tax which didn’t collect on time will be collected. The regulation which provides VAT exemption for foreigners while purchasing residence and business office in Turkey will start to be implemented from 1 April.
The Government has deepened the works in the housing sector and passed a new regulation which anticipates providing VAT convenience to the foreigners who want to buy a house.
New works have been carried out on this subject for boosting the housing sectors and the government has given an incentive to the markets. The housing campaigns have mobilized the sector as well as contributing into its development. It is decided that various conveniences are offered to enhance the housing and investment opportunities of the foreigners in 2017. In addition to giving citizenship to the foreigners who make an investment by buying a house for 1 million dollars or a higher amount, it was decided that incentives are offered such as VAT discount and remitting the stamp duty.
According to the recent statements by the Minister of Finance, Naci Ağbal, it is decided that a new incentive is given for the real estate sector in 2017. It is decided that VAT, which was previously decided to be discounted, is remitted for the foreigners who buy property in our country. Following this practice which aims to increase the foreigner’s coming to the country and encourage them for investments, Minister Naci Ağbal said; “When the foreigners come for holiday, they stay for a week and then go back, but if they have a house here, they will stay continuously”.
According to the real estate statistics in 2016, there was substantial decrease in the property sales to foreigners. Given that, it is decided that VAT is remitted for the foreigners who buy house in order to increase these rates and boost the sales. It is expected that this decision will increase property sales to foreigners significantly.
The Ministry of Finance has stated that the foreigners who purchased houses will be exempted from paying 18 % VAT on condition of not selling the property for 1 year and after 1 year if the property will be sold to someone 18% VAT still will not be applied.