TAX REDUCTION FOR THE ELIGIBLE TAX PAYERS
The General Communiqué on Income Tax (the “Communiqué”) is published in the Official Gazette on the 23th December 2017.
The Communiqué is prepared based on the Income Tax Law Numbered 193 (“Law No. 193”) and the Law on Restructuring of Certain Receivables and Changes in Decrees on Certain Laws and Laws numbered 6824 (‘‘Law No. 6824’’).
The Purpose and Scope
The purpose of this Communiqué is to specify the procedures and principles regarding the application of tax reduction for the eligible taxpayers
Those who will benefit from the tax discount
-Those who are subject to income tax due to commercial, agricultural or professional activity,
-Corporate taxpayers, except the insurance and reinsurance companies, pension companies and the pension investment funds and the corporate taxpayers, which are active in the financial and banking sectors,
Requirements of Tax Reduction
- The tax declarations of the year in which the tax reduction will be applied and the two years before that must have been submitted and the taxes accrued in these years must have been properly paid to the tax office within the statutory periods.
- There should be no assessment either complementary or ex-officio made by the tax office, on the taxes of the year in which the tax reduction will be applied and the taxes of the two years before that.
- There should be no unpaid due tax amount exceeding 1.000 TL (including the penalty) in the year in which the tax reduction will be applied.
- No offence indicated in the Article 359 of the Tax Code should be committed in the year, which the tax reduction will be applied, and the four years before that.
The eligible taxpayers will calculate the 5% tax reduction over the income or corporation tax calculated on annual income or corporation tax declarations. The tax reduction will not exceed 1 million Turkish liras in any case. The amount of the tax reduction calculated in this way shall be reduced primarily from the income or corporation tax. If the amount of the tax reduction is more than the taxable amount to be paid, the remaining amount may be reduced from other taxes accrued on the taxpayer’s statement within a full year following the date of the annual income or corporate tax declarations. The amounts, which cannot be deducted during this period, will not be returned and reimbursed. Effective Date This Communiqué shall enter into force on 23th December 2017, the date its publication, and shall be applied in the annual income or corporate tax returns which will be declared starting from 1 January 2018.