CEESS Global :20% Withholding Tax Decision on Housing Rents by the Ministry of Treasury and Finance

An important change has been made in the housing rental market in Turkey. With the new regulation of the Ministry of Treasury and Finance, 20% withholding tax will be applied on housing rents. With this regulation, landlords will pay 20% of the rent they receive from tenants as tax every month.

What Does the New Regulation Bring?

This decision by the Ministry of Treasury and Finance aims to increase transparency in the residential rental market and prevent tax evasion. With this regulation:

Increasing Tax Revenues: The withholding tax practice aims to increase tax revenues. Thus, additional resources will be provided to the state budget.
Transparency: Leasing transactions are expected to become more transparent and reduce the informal economy.
Regulation for Landlords: Since landlords will pay 20% of the rent every month as tax, this regulation will play an important role in their financial planning.
What Does It Mean for Landlords and Tenants?

This new regulation will bring significant changes for both landlords and tenants:

For Landlords: Landlords will now pay 20% of their income from rents as tax each month. They will therefore need to take this rate into account when entering into rental agreements.
For Tenants: For tenants, there will be no change in rental rates. However, it is foreseen that this regulation may indirectly affect the rental prices in the housing rental market.

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