In order to able to make combine to Income Tax Law (since 1961)
and Corporate Tax Law (since 2007) and include both natural persons
and corporations, a new income tax law draft was prepared and sent
to Turkish Grand Assembly. It was expected to take effect until New
Year. In this article, basic amendments are stated shortly.
New Concepts Determinations
Under article 2nd of draft, some notions are explained clearly;
minimum wage, child, permanent representative, spouse, business
center, workplace, legal center, corporate. Minimun wage, child,
spouse, workplace and legal center notions are received from
administrative and official regulations like circulars, communiques
and rulings. On the other hand, permanent representative and
business center notions are re-qualified widely.
No Change On Income Definition
It was understood from draft that income concept are not change
clearly and same with effected income tax law. The income tax is
levied on the income of individuals. The term individuals mean
natural persons. But inherently corporations are included to
taxpayer category. An individual's income and corporate income
may consist of one or more income elements listed below:
Salaries and wages,
Income from independent personal services
Income from immovable property and rights (rental income)
Income from movable property (income from capital
Other income and earnings without considering the source of
Craftsmen Exemption Are Clarified
According to income tax law draft, notion of craftsmen exemption
are clarified. Under effected income tax law craftsmen exemption is
considerable restricted and put in order just some craftsmen
branches. But with new draft, this craftsmen branches ranked
strictly and written to draft text. Thus, craftsmen exemption right
may use just specific craftsmen groups. On the other side, it was
given a wide authority to Ministry of Finance, so The Ministry may
use his authority and expand to craftsmen groups if he wants.
Custom Construction Business
Under article 14th, a new application "custom construction
business" was regulated. This article is arranged to
construction business of flat received for landownership. This
business has been carried out by circulars, communiques and
rulings. Thanks to this draft article, it is included to law text
clarify. According to article 14/3, hereinafter, construction
business of flat received for landownership is considered a
business profit for landowners. But for this, there must be gain
sharing between landowner and construction firm. In this case,
landowners have to make registration to tax administration as
taxpayer. On the other side, gross sum of the areas covered of
properties which relinquished for landowner, are important for
taxpayer registrations. For example, if gross sum of the areas
covered of properties which relinquished for landowner does not
exceed to 500 square meter, in this case not necessary a
registration for landowner.
Tax Return For Copyrights Gains
The proceeds obtained by authors, interpreters, sculptors,
calligraphers, painters, composers, computer programmers and
inventors and their legal heirs, by publishing their Works such as
poems, stories, novels, articles, scientific researches and
studies, software, interviews, cartoons, photographs, films, video
bands, radio and television scripts and plays by means of
newspaper, magazine, computer, internet, radio, television and
video or by selling their works in form of books, CD, floppy disc,
painting, statue and musical notes and patent letters of those or
by transferring and assigning or leasing their rights on those
shall be excluded from personal income tax.
According to article 30/8 of draft, this exclusion is
restricted. Hereinafter, if these gains owners earn 188.000 Turkish
Liras or more, they have to filling return and taxed from
percentage 15 to 35. And also they will have a new right: lump sum
expenses. If they would like, they may benefit deduction of lump
sum when they fill return.
Other Some Amendments
It was made new amendments on:
Stoppage rates and categories.
Aggregation method of income and declarations.
Payment of taxes and tax return periods.
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.
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