Electronic service providers have to be taxpayers in Turkey

With an amendment to the Turkish Tax Law as of 01.01.2018;

The requirement of “Declaration and payment of VAT by the tax service providers, related to services provided electronically, to the non-taxpayer real persons in Turkey with a price” has been brought by the ones that doesn’t have a residence, office, legal center and business center in Turkey.

Any kind of service provided in electronic environment, for example; sales of software and all digitized products, subscription to web sites, access to music, movies, games, access to electronic books and publications, remote education services including remote maintenance of computer software and hardware, remote system management and online data storage services and accessing, downloading and updating and any services provided similar to these, are in this scope.

Electronic service providers that doesn’t have an office in Turkey; they will declare and pay VAT in Turkey related to the electronic service transactions by establishing “Special VAT Liability for Electronic Service Providers“ with VAT declaration number 3. For registration; first of all, the form, which is at the website (www.digitalservice.gib.gov.tr) of revenue administration of turkey, will be filled. After the approval of the form, VAT obligation will be established.

In this way, there is no obligation to sign the bookkeeping and declarations of professional VAT assigners to Electronic Service Providers.

The Value Added Tax calculated on these services, which is made monthly; will be declared monthly. VAT declarations for transactions made in January, February and March 2018 only during the transition period to application, can be made between 01.04.2018-24.04.2018.

Those who have transactions within the scope of the law are required to submit their registration application within April at the latest and submit a declaration for their quarterly transactions in January-February and March on 24.04.2018 at the latest.

Tax penalties will be applied for those who are engaged in the transaction as mentioned above and who do not submit their related declarations by not opening VAT registration in Turkey.

We remind you that the necessary obligations must be met to avoid any penalties.

Contributed by

Ozan Arıkan, Nexia Turkey
E oarikan@nexiaturkey.com.tr