Partial Withholding Application in Provinces Declared as Force Majeure
Due to the earthquake disaster that occurred in Kahramanmaraş, a force majeure situation was declared for the provinces affected by the earthquake, including Adana, Adıyaman, Diyarbakır, Gaziantep, Hatay, Kahramanmaraş, Kilis, Malatya, Osmaniye, Şanlıurfa, and Elazığ (Circular No. 09.02.2023/30).
Regarding the force majeure situation, in the section titled “Nature of Partial Withholding and Buyers Subject to Withholding” (I/C-2.1.3.1) of the Value Added Tax General Application Communiqué, the following regulation is included:
“According to the Tax Procedure Law No. 213, during the period between the start and end of the force majeure, the tax obligations of the taxpayers benefiting from the force majeure are postponed. In this context, for taxpayers whose obligation to submit declarations is postponed to a later date, no withholding tax will be applied on their purchases within the partial withholding scope during the period they are in force majeure. However, if the seller is also within the force majeure scope, withholding tax will continue to be applied in accordance with general provisions.”
According to this regulation:
- Taxpayers registered in the affected provinces as of the earthquake date (06.02.2023) will not have withholding tax applied to purchases within the partial withholding scope between 06.02.2023 and 31.07.2023 (inclusive).
- If both parties are located in provinces where force majeure has been declared, then withholding tax will be applied in accordance with general provisions. In this case, the declarations related to purchases subject to withholding will be due by 15.08.2023 (Tuesday), and taxes due on these declarations must be paid by 31.08.2023 (Thursday).
- If the buyer is in a force majeure situation but the seller is not, withholding tax will still be applied.
- The above regulation regarding force majeure has no effect on transactions subject to full withholding tax.
Best regards,
BİLGENER
