Real estate sales made as a first delivery to foreign nationals and institutions not resident in Turkey, are exempt from VAT according to subparagraph (i) of Article 13 of the VAT Law.
The principle of reciprocity, which is required for foreign persons to acquire real estate or limited real rights in Turkey, was abolished with an amendment made in the Land Registry Law in 2012, thus facilitating the acquisition of real estate by foreigners in Turkey.
Parallel to the above-mentioned regulations, the regulation on the implementation of the Turkish Citizenship Law, was amended in 2017 and 2018 in order to encourage the sale of residences and workplaces to foreigners. The right to acquire Turkish citizenship is given to foreigners who purchase immovable property worth at least USD 250,000, or real estate investment fund participation shares worth at least USD 500,000, on the condition that they do not sell for three years.
IMMOVABLES COVERED BY THE EXEMPTION
Buildings constructed as residences or workplaces are included in the scope of the exception regulated in Article (13/i) of Law No. 3065.
In order for the residence or workplace to be subject to delivery within the scope of this exception, it is obligatory that the building be constructed as a residence or workplace, it should hold a building permit, and should be delivered ready for the use of the buyer. Where applicable, floor servitude must be established in residences or workplaces. Residences or workplaces defined as residences, shops, offices, apartments, timeshare, or similar in the building permit, are considered within the scope of exception.
FIRST DELIVERY OF RESIDENCE OR WORKPLACE
Exception is applied at the FIRST DELIVERY to be made by the taxpayer who has built a residence or workplace. In case the residence or workplace is purchased from the builders, and sold to someone else, the delivery of the residence or workplace is not considered as first delivery.
BUYERS WHO CAN BENEFIT FROM THE REGULATION
It is possible for buyers who meet these conditions and benefit from this exemption to purchase more than one residence or workplace within the scope of the exemption.
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