02.08.2024/33
Law No. 7524 Amendments to the Income Tax Law
Law No. 7524 on Amendments to Tax Laws, Certain Laws and Decree Law No. 375 was published in the Official Gazette dated 02.08.2024 and numbered 32620.
The regulations regarding the Income Tax Law introduced by the Law are summarized below:
1. Wage Exemption is Introduced in the Case of Share Acquisition to Service Employees by Employers Qualified as Techno-Entrepreneurship Companies.
In recent years, company shares may be transferred to employees within the framework of share ownership plans in order to increase employee productivity and loyalty. After the fulfillment of predetermined conditions and the completion of a predetermined period of time, employees may be given free shares or they may be given the option to purchase shares at a low price.
Since such share acquisition is considered compensation for work, it is treated as wages. With the regulation introduced by Law No. 7524, the portion of the nominal value of shares granted free of charge or at a discount by employers qualifying as technogirişim companies (as determined by the criteria set by the Ministry of Industry and Technology) to employees, which does not exceed the gross annual salary for that year, is exempt from income tax.
However, the share certificates acquired by the service personnel in this way
- If it is disposed of within three full years from the date of acquisition, the entire exempted tax,
- 75% of the exempted tax in case of disposal within four to six years,
- 25% of the exempted tax in case of disposal within seven to twelve years
The tax is collected from the employer together with the default interest without any tax loss penalty.
In this way, the statute of limitations regarding the taxes not collected on time due to the exemption starts from the beginning of the calendar year following the date of disposal of the share certificates given to the service personnel free of charge or at a discount by the service personnel.
Effective: 31.07.2024
2. Daily revenue can be determined for commercial and professional earnings and explanations will be requested from those whose tax base is below the determined averages.
With Law No. 7524, the repealed Article 69 of the Income Tax Law has been reorganized. Under this regulation, taxpayers with commercial and professional earnings who declare income below the average determined by inspections may be required to provide an explanation.
Accordingly, in order to determine the daily revenue amounts within the scope of Article 127 of the Tax Procedure Law, inspections can be conducted at least three times a month and no less than twelve times in a calendar year.
The monthly revenue amount is calculated based on the average of the daily revenue amounts determined as a result of the inspections made by the administration. The average monthly revenue amount is determined by dividing the sum of the monthly revenue amounts determined in this way by the number of months. By multiplying the monthly average revenue amount by the number of months in which the taxpayers are active, the related calendar year revenues of the taxpayers are determined.
With the determined revenue amounts;
a) For those who keep books on the balance sheet basis, the gross sales amount in the income statement of the relevant calendar year,
b) For those who keep books according to the business account basis, the amount of revenue obtained during the period included in the business account summary of the relevant calendar year,
c) For those who keep a self-employment income book, the gross revenue amount in the self-employment income declaration for the relevant calendar year
Taxpayers with a difference of more than 20% are invited to provide an explanation under Article 370 of the Tax Procedure Law, and the evaluation of the explanation is made in accordance with the provisions of the said article.
The provisions of this article shall also apply to corporate taxpayers.
Effective: 01.01.2025
3. Payments to be made by Electronic Commerce Intermediary Service Providers were included in the scope of withholding tax. In addition, the President was authorized to determine the sectors and fields of activity to be subject to withholding tax.
Law on the Regulation of Electronic Commerce
- Intermediary service provider: Natural and legal persons who provide the electronic commerce environment for the economic and commercial activities of others,
- Electronic commerce intermediary service provider: An intermediary service provider that allows the electronic commerce service providers to make a contract or place an order for the supply of goods or services in the electronic commerce marketplace
is completed in the form of.
With the subparagraph 19 added to Article 94 of the Income Tax Law, an obligation has been introduced for such service providers to withhold withholding tax on their payments.
In addition, subparagraph 20 has been added to the article regarding the possibility of withholding tax on payments made for the purchase of goods and services related to the sectors or fields of activity determined by the President.
Effective: 01.01.2025
You can access the relevant Law here.
Sincerely,
BİLGENER
