A very comprehensive piece of legislation on tax amnesty has been published on Turkish Official Gazette recently. The law is called “Act of Reconstruction of Some Receivables” and it is a very detailed and highly technical explanation on the process of tax amnesty and tax reduction on numerous matters such as tax overdue, traffic tickets, amnesty on tax irregularities, exemption from tax audits etc.
One of the most important aspects of the Act is it allows companies to be exempt from fines and penalties related to unpaid taxes. The objective of the law is to encourage companies to increase their tax return to a sum that is determined by the government. Companies which increase their tax return and pay this to the government will not be subject to inspection of tax authority or any fines or penalties. As unrecorded income is a real issue in Turkey and government is having difficulties in collecting tax the law will be beneficial both to the companies and to the government. Hence, a company who pays this to the government will be fully exempt in terms of penalties, fines etc. for the past years.
Moreover, the government foresees a structure for paying the increased taxes, these can be paid all in one go or in instalments. The Act provides that the deadline for applying to benefit from the Act is 31 October 2016. If you would like to find out how you can be benefit from this Act, please contact our tax team on 02036407692.
To review the full text of the Act, please click here.