There is VAT Exemption on sales of property in Turkey. The exemption from value added tax is applied on the property that has been sold to non-resident individuals and corporations. There are certain conditions for the exemptions.
- Property should be in the form of housing or office,
- Property should be subjected to sale for the first time,
- Price of the property should be paid in foreign exchange and should be transferred to Turkey,
- If the buyer is individual, he/she should not be resident of Turkey,
- If the buyer is a corporation, it should have neither place of corporation nor place of management in Turkey,
- If buyer is a corporation, it should not have any permanent office in Turkey.
Although standard VAT rate is 18% in Turkey, this exemption is with zero rate which means construction companies that have sold the property will be able to deduct the input VAT related with the construction of the property.