The Ministry of Finance has commenced field inspections to verify rental income declarations as part of the 2024 tax declaration period. Treasury and Finance Minister Mehmet Şimşek emphasized the importance of accurate reporting of income, stating, “The declaration period for 2024 income has started, and it is crucial to report earned income correctly for ensuring tax fairness. We expect taxpayers to be highly diligent in complying with tax laws.”
Each year, annual income tax returns are due in March. For the 2024 tax year, returns for income from commercial, agricultural, freelance activities, as well as rental, salary, capital income, and other earnings, must be submitted by April 2, which falls on a Wednesday.
Minister Şimşek reaffirmed the government’s commitment to combatting the informal economy. He noted, “We will utilize advanced analytical techniques to identify potential risks in various sectors and combat unreported economic activities. By increasing actual field audits, we aim to establish a strong culture of tax auditing among taxpayers.”
Enhanced Use of “Invitation for Explanation”
Minister Şimşek also pointed out the intensified use of the “invitation for explanation” process, which targeted taxpayers suspected of causing tax losses. He explained, “We are reaching out to these taxpayers individually to ensure they correctly report their income for tax fairness. I have tasked the leaders of the Revenue Administration with visiting all provinces, where they will engage with civil society organizations to highlight the importance of accurate declarations and our determination to combat tax evasion.”
Physical Inspections in Residential Properties
In 2024, the Revenue Administration (GİB) expects the total number of tax returns to surpass 2 million, up from 1.8 million in the previous year. To ensure rental income is properly reported, the GİB analyzed around 1.5 million residential properties and conducted physical inspections at 425,000 of these homes. As a result, 376,000 new taxpayers were prompted to submit tax returns.
Additionally, 38,000 rental income forms were voluntarily submitted by tenants through the Digital Tax Office. This revealed that 20,000 taxpayers had not filed their returns, prompting legal action. These efforts led to a 26% increase in the number of filed declarations compared to the previous year.
Investigation of Underreported Rental Income
The declarations submitted by taxpayers showed significant increases in reported income, with a 107% rise in declared income, reaching 399.2 billion Turkish lira, and a 101% increase in calculated tax, totaling 126.9 billion Turkish lira. The initiative also prompted nearly 55,000 taxpayers to submit backdated declarations, reporting 3.1 billion lira in rental income. Similar initiatives are expected to continue this year, focusing on taxpayers who underreport their rental income.
