17.07.2023/77
Corporate and Value Added Tax Exemptions on the Sale of Immovable Property by Corporate Taxpayers were abolished.
Article 5/1-e of the Corporate Tax Law stipulates that 50% of the gains arising from the sale of immovable properties that have been included in the assets of corporations for at least two full years are exempt from corporate tax, provided that the other conditions specified in the article are also met.
Article 19/b of Law No. 7456 published in the Official Gazette dated 15.07.2023 and numbered 32249 the exemption provision has been removed. However, with the provisional article 16 added to Law No. 5520, the date of entry into force of the article Before 15.07.2023, the exemption will continue to be applied for the immovable properties that have been taken into asset before 15.07.2023. Exception for these immovable properties, by 25% will be applied.
In addition, within the scope of subparagraph (b) of the third paragraph of Article 19 of the Corporate Tax Law No. 5520; immovables, participation shares, production and service enterprises could be subject to partial spin-off under certain conditions. With the regulation made in Article 20 of Law No. 7456 immovables are excluded from the scope of partial spin-off. The regulation will enter into force as of 1.1.2024.
On the other hand, pursuant to Article 17/4-r of the VAT Law, the assets of the corporations for a period of two years The VAT exemption on immovable property sales was abolished by Article 7 of Law No. 7456. However, with the provisional article 43 added to the VAT Law, the effective date of the article Before 15.07.2023, the exemption will continue to be applied for the immovable properties that have been taken into asset before 15.07.2023.
The relevant Law is available here.
Sincerely,
BİLGENER
