The Concept of Suspicious Receivables is defined in Article 323 of the Tax Procedure Act.


Provided that it is related to the acquisition and sustenance of commercial and agricultural income:

1. Receivable that are in the litigation or execution phase;

2. Despite the protest or written request more than once; receivables that are too low to be worth litigation and enforcement proceedings, which the debtor has not paid;

It is assumed suspicious receivables.

For the suspicious receivables written above, a provision in inactive can be made according to the savings value of the assessment day.

To which receivables this provision belongs is shown in the provision account. In secured receivables, this provision is limited to the remaining guarantee.

Subsequently, amounts of suspicious receivables are transferred to the profit and loss account in the period they are collected."

According to this regulation, with or without notes, receivables cannot be collected in due time or the future and are defined as " suspicious receivables.


In our law, the principle of periodicity and accrual has been embarked on determining commercial income.

The periodicity principle states that the income or expense should be considered in the relevant year; the accrual principle states that it should be regarded with the emergence of the income or expense element.

Firms enter their uncollectible receivables as revenue when they sell goods and services. On the other hand, in cases where they cannot collect their receivables on time or it is not possible to collect them, they have to pay taxes on these amounts.

If this receivable, which was written to income during the accrual of the receivable, will be doubtful afterwards; with "Provision for Suspicious Receivables", which was introduced to eliminate the problem that arose with the adoption of the accrual principle in our legislation, it is aimed to balance the income record and solve the problem by making a provision equal to the amount of receivable in the liability.


For a receivable to be qualified as a Suspicious Receivable, all of the following conditions must be provided.

i. It should be related to the acquisition and sustenance of commercial and agricultural income:

For a receivable to be considered as related to the acquisition and continuation of commercial and agricultural income, the receivable must have been entered as revenue before. In other words, it must have been obtained as a result of commercial activity. Therefore, it is not possible to set aside a provision for a receivable that has not been entered as income before.

ii. Commercial books are required to be kept according to the balance sheet method:

According to the article of the law, since "debt allowance" is obligatory and suspicious receivables can only be entered by taxpayers who keep commercial books according to the balance sheet method as an expense.

iii. The Receivable Must Be Unsecured:

It is not possible to set a provision for secured receivables, and a condition can be made for the unsecured part of the receivable. At the phase of enforcement proceedings, the seizure of a sufficient amount of assets for the debt is assumed to be the receivable being secured.

The decision of the 4th Chamber of the Council of State, dated 17.01.1994 and numbered E. 1983/679, K. 1984/204

"Provision will not be made for receivables secured through seizure."

iv. Collection of the Receivable Must Have Become Suspicious:

For the receivable to be qualified as suspicious, one of the following two conditions must be available:

  • The Receivable is at the Phase of Litigation and Execution

Suing a lawsuit with the court and presenting a petition to the enforcement office is sufficient to set aside a provision. However, the receivable must be followed seriously in the court and enforcement office. It is not enough to formally go to litigation or enforcement proceedings. It is required that the necessary legal efforts be made.

"Since the enforcement proceedings cannot be followed seriously, the receivable whose file is not followed up cannot be considered as suspicious."

The point to be noted here is that while only a formal application is sufficient to set aside a provision in the balance sheet, it is not sufficient only for an official application to conclude that the receivable has become suspicious.

  • Despite the Debt Requested More than Once by Protest or Written, receivables unpaid by the debtor that it's too low not to be worth the lawsuit and enforcement proceedings

For the receivable to be entered as an expense by making provision for suspicious receivables, the low receivables that are not worth litigation and enforcement proceedings must not have been paid by the debtor despite the protest or written request more than once. So, both conditions must be provided at the same time.


Since the receivables that are not paid on the due date will become doubtful in the period in which legal remedies are applied, the provision should be allocated in the relevant period.

Therefore, it should be stated that if no provision is allocated in the period when the receivable becomes suspicious, it will not be possible to make a provision later.

There is no provision in the Tax Procedure Law regarding the period in which a provision should be allocated for suspicious receivables. In the decision of the General Assembly of the Tax Case Chambers of the Council of State, numbered E.2006/291, K.2006/334 and dated 08.12.2006, It is stated that the provision can be made in the period when the receivable becomes suspicious.

With the decision of the 7th Tax Court of Istanbul on 8.3.2014 and numbered E: 2002/1198, K: 2004/444; the court stated the reasoning that allocating provision for suspicious receivables to the discretion of the obliged parties would lead them to allocate provision for suspicious receivables in the year in which they make the most profit. This situation would be contrary to the purpose of the legislator. In addition, it is stated that it is not possible to allocate a provision after the period when the receivable becomes suspicious in the rulings of the Revenue Administration, Istanbul Tax Office on 21.06.2012 and the Izmir Tax Office on 25.05.2011.

Although this is a general opinion, there are also decisions to the contrary.

In case of passing the period in which a receivable has been entered but whose collection is suspicious, since no provision will eliminate the possibility of making a provision on the following valuation days; if they want, taxpayers can allocate a provision for a receivable that is seen as a trade receivable, in any of the periods after the year they become suspicious. (4th Chamber of the Council of State 10.11.1992 T., E. 1992/719, K. 1992/4809 and 4th Chamber of the Council of State Decisions 02.05.1991 T., E. 1988/4658, K.1991/ 1627) (https://dergipark.org.tr/tr/download/article-file/953313). However, we would like to point out that the decisions are outdated.

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.