The Directorate of Revenue Administration changed its previous opinion provided with the letter dated February 13, 2014 and No.17483 on the Resource Utilization Support Fund ("RUSF") application of foreign currency and gold loans extended by foreign residents to Turkish residents other than banks and financial institutions in parallel to our opinion provided under our Tax Alert 2/2014. New opinion of the Revenue Administration issued with the letter dated August 12, 2015 and No.70903105-165.01.03-77912 for the name of the Banks Association of Turkey is as follow:
- With respect to the FX loans granted from offshore, the RUSF shall apply at the rates which are effective on the utilization date of the loan;
- If the FX loan, the term of which is below 3 years, granted from offshore by applying RUSF is extended as being adhered to the original loan agreement, any RUSF shall not apply over the extended loan regardless of whether the average term of the loan together with the extended period is below or above 3 years, and the amount of RUSF which has been already withheld in accordance with the average term on the utilization date of such loan shall not be refunded;
- If the FX loan, the term of which is 3 years or more, granted from offshore from which RUSF was not withheld is extended as being adhered to the original loan agreement, RUSF shall not withheld over the extended loan regardless of whether the extended period is below or above 3 years since the average term of the loan will be above 3 years;
- If the FX loan granted from offshore is repaid before the maturity term (i.e.; for loans which have been extended, the extended term should also be considered), and the time period between the utilization and the repayment date is less than 3 years, the RUSF with a penalty amount shall apply over the loan the average term of which is calculated as between the utilization date and the repayment date.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.