From 1 January 2016, certain tradesmen, freelancers, farmers and merchants in Turkey must make receipts and payments over TRY 7,000 through an intermediary financial institution. The value threshold was last considered in 2004. The Turkish Ministry of Finance published the Tax Procedure Law General Communiqué number 459 in Official Gazette number 29572 on 24 December 2015 (“Communiqué”).

The Communiqué’s requirements apply to:

  • Merchants who are obliged to obtain invoices, according to Article 232 of the Tax Procedure Law.
  • Individuals who work as freelancers.
  • Merchants whose incomes are determined by simplified business taxation.
  • Farmers who are obliged to keep books.
  • Tradesman who are exempted from tax.

In this context, receipts and payments are deemed to include all kinds of delivery of goods or fulfillment of services, as well as advance payments and deposits.

Qualifying individuals must use an intermediary financial institution even if payments for a particular transaction are made on different dates, provided the total combined amount of the payments exceeds the TRY 7,000 transaction threshold. Similarly, an intermediary financial institution must be used if the total combined value of multiple transactions with the same recipient on the same day exceeds TRY 7,000, even if each transaction is less than TRY 7,000 on its own.

For transactions within the Communiqué’s scope, intermediary financial institutions must prepare documents to certify receipts and payments. However, these documents are not deemed to certify the transaction itself, but rather are only deemed to certify receipts or payments regarding the transaction. Therefore, any transaction certification obligations arising from the Tax Procedure Law will continue to apply.

Exclusions from the Communiqué’s requirements include (Article 4.2):

  • Transactions made at capital market intermediary institutions.
  • Foreign exchange purchases.
  • Transactions realized at notary publics.
  • Transactions realized at real estate registration offices.

Penalties outlined in the Tax Procedure Law will apply for failures to comply with the Communiqué’s receipt and payment obligations.

Please see this link for full text of the Communiqué (only available in Turkish).