Valuable residence tax is a duty paid by the owners, usufruct right holders, or in the absence of both of these, those making dispositions of a residential immovable property which has a value above a certain amount.

According to Article 42 of the Real Estate Tax Law No. 1319 (“Law”), residential immovable properties within the borders of Turkey, whose building tax value to be determined following Article 29 of the same Law are above a certain amount, are subject to the valuable residence tax. As of January 1, 2022, according to the General Communiqué on Real Estate Tax Law published in the Official Gazette dated December 21, 2021, and numbered 31696, valuable residence tax is applicable to residential properties with a value of TRY 6,173,000 and above.

The lower and upper limits and rates to be used in determining the tax base and ratio of valuable residence tax regulated in Article 44 of the Real Estate Tax Law are as follows:

  • For residences having a value between TRY 6,173,000 and TRY 9,260,000 TRY (including this amount): three per thousand for the part surpassing TRY 6,173,000;
  • For residences having a value up to 12,347,000 TRY (including this amount): TRY 9,261 for the value of TRY 9,260,000 and six per thousand for the surpassing amount;
  • For residences having a value higher than TRY 12,347,000: TRY 27,783 for the value of TRY 12,347,000; ten per thousand for the surpassing amount.

There are four exceptions where residential immovable properties are exempted from the valuable residence tax. The first one is for the residential immovable properties owned or usufruct by general and special budget administrations, municipalities, universities, and the Housing Development Administration. The second one is the exemption provided for those who own only one residential property within the borders of Turkey, and the exemption provided for the lowest valued residential property, which is subject to the valuable residence tax, of those who own more than one residential property. The third one is for the residential properties owned by foreign states and used as consulate or embassy buildings and the residential properties and their extensions allocated to the accommodation of ambassadors and the residential properties owned by international organizations located in Turkey or their Turkish representation offices in Turkey. The fourth one is for recently constructed residential properties, which are not sold, transferred, or assigned to third parties, owned by corporations mainly engaged in construction activities.

In terms of valuable residence tax, the exemptions provided to those who own a single residential immovable property, those who own more than one residential immovable property, and corporations whose main activity is the construction of buildings are the matters that are to be remarked.

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