Attention for those paying rent in cash! Cash payments are now prohibited, and heavy fines are on the horizon for both tenants and landlords who fail to comply. A fine equivalent to 10% of the rent amount will be imposed on those making cash payments.
According to a draft regulation opened for public consultation by Turkey’s Revenue Administration (GİB), the minimum fine will be 5,000 Turkish lira and will apply to both tenants and landlords.
The draft regulation, titled “General Communiqué on Proof of Rent Payments in Relation to Income Tax,” specifies that payments for rental properties must be made through banks or the Turkish Post (PTT). Even short-term rentals, such as weekly or daily stays, fall under this requirement.
Currently, rental payments for business premises, regardless of the amount, and residential rent payments exceeding 500 Turkish lira must be made through banks or the PTT. The new draft eliminates the 500-lira threshold, mandating that all rental payments, regardless of the amount, be processed through a bank or PTT.
FINES FOR TENANTS
Under the existing regulation, only landlords and tenants of business properties were fined for cash payments, but residential tenants were not. However, recent changes in the law, passed in July, now allow fines for residential tenants as well. If rent is paid in cash instead of through a bank or the PTT, both the tenant and landlord will face fines equal to 10% of the rent amount for each violation, with a minimum of 5,000 lira. Previously, this penalty was set at 5% of the rent with a minimum of 3,000 lira.
However, tenants who report cash payments to the authorities within five business days will be exempt from the fine. The maximum fine for special violations in a calendar year will increase from 8.7 million lira to 20 million lira.
Reducing Unregistered Transactions
President of Ankara’s All Real Estate Agents Chamber, explained that these new regulations are aimed at reducing unregistered transactions and benefiting tenants. He added that the system will help ensure rent payments are official and prevent excessive rent increases. Akçam also mentioned the upcoming implementation of an e-contract system, which will work in conjunction with these new regulations to ensure all rental transactions are transparent and properly recorded.
