New Guidelines Clarify Amnesty Process for Underreported Title Deed Fees in Property Sales Transactions
The Turkish Revenue Administration (GİB) has issued a new internal circular that clarifies how individuals who have underreported property transfer fees can benefit from the “repentance provisions” under Turkish tax law. The updated guidance outlines the procedures for taxpayers who voluntarily correct past underreporting, as well as the consequences for those who fail to come forward.
According to the circular, individuals who realize they underreported the property transfer (tapu) fee can apply under Article 371 of the Tax Procedure Law (Vergi Usul Kanunu). If they do so voluntarily, they will only be required to pay a monthly 4.5% repentance interest on the unpaid amount. Importantly, those who correct their declaration under this provision will not face any tax loss fine or procedural fines.
“They Will Face Penalties and Late Payment Interest”
However, individuals who do not file a repentance request and are later found to have underpaid will face more severe consequences. They will be required to pay both the outstanding fee and a tax loss penalty equal to 25% of the underpaid amount. In addition, a monthly 4.5% late payment interest will be applied.
Valid Even When No Official Declaration Was Filed
The circular also makes it clear that in most property transfers, the parties do not submit a separate formal tax return. Instead, the documents filled out during the deed registration process are considered binding declarations for tax purposes. As a result, even in the absence of an official tax return, these declarations may be corrected through the repentance procedure.
No Procedural Fine for Voluntary Correction
Another key point emphasized in the circular is that no procedural fine will be imposed for repentance-based corrections. Because repentance declarations in these cases are not made via a standard tax return, they do not trigger late-filing penalties. This distinction further encourages taxpayers to come forward voluntarily without fear of additional punishment.
“The Differences Between Tax Loss and Repentance Clarified
The administration clearly outlined the difference between correcting an underreporting with repentance and doing so after being identified by authorities. In the first case, only the repentance interest applies. In the latter, both a tax loss penalty and interest charges are enforced. This clear separation gives taxpayers a strong incentive to come forward and fix past mistakes voluntarily.
These guidelines aim to streamline the correction process and reduce the legal and financial risks for property owners while encouraging tax compliance through transparency and fairness.
