VAT is an expenditure tax paid by the supplier of goods and services but levied by the buyer. The rate is 18% and the principles regarding which persons to be exempted from tax in Turkey have been determined within the framework of the Value Added Tax Law.

For the first delivery of residences or workplaces in Article 13-i of the Value Added Tax Law (VAT); Turkish citizens residing outside of Turkey, foreign real persons not residing in Turkey, foreign organizations granted permission to acquire real estate in Turkey under special laws (provided that other conditions in the Law are met) are exempt from tax.

Investors within the scope of this exemption can make investments without paying VAT, provided that it is applied on the first delivery of buildings constructed as residences or workplaces and the cost is brought to Turkey in foreign currency.

The VAT rate of 18 is applied to most of the new home sales. It is possible to invest in housing without paying VAT with the VAT exemption certificate to be obtained by the foreign investor from the tax office to which the property is affiliated. In addition, it is possible to benefit from VAT exemption for more than one residence.

The conditions that the property must meet for VAT Exemption are as follows;

1. The residence or workplace must have at least a floor construction established.

2. It must be the first delivery of the residence or workplace.

3. In addition to foreigners, Turkish citizens and even legal entities can benefit from the     exemption.

4. The price must be brought to Turkey in foreign currency.

5. The residence or workplace cannot be sold for a period of 3 year.

The conditions to be met by the Investor for VAT Exemption are as follows;

The foreigner benefiting from the exemption must not be resident in Turkey. Staying in Turkey for more than 6 months in the last 1 year or having a residence permit is an obstacle to obtaining an exemption.

It must be proved that the price was brought to Turkey in foreign currency.

In addition, there are other documents that the investor must collect. First of all, it is essential for the investor to have a potential tax identification number when making applications. 

The documents required for VAT exemption are as follows:

1. Power of Attorney

2. Passport translation

3. Certificate of residence abroad

4. Receipts showing that money was brought in foreign currency

5. Receipts showing that the money was paid to the seller

6. Reservation contract or sales contract

7. Deed image