Understanding Capital Gains Tax on Property Sales
When selling a property in Turkey, the applicable tax rate depends on how long you have owned the property:
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No Tax After Five Years:
- If you sell your property after five years from the purchase date, you are exempt from paying capital gains tax on the sale. This provides an incentive for long-term investment in real estate.
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Tax for Sales Within Five Years:
- If you decide to sell your property within five years, you will be liable to pay a profit tax. This tax is calculated based on the difference between the purchase price and the selling price.
- The profit tax rate is typically around 20% of the profit you made from the sale.
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Calculating the Profit:
- To determine the profit, subtract the original purchase price (including any associated costs, such as legal fees) from the selling price. This figure represents your taxable gain.
Understanding these tax implications can help you make informed decisions about your property investment strategy in Turkey.