17/05/2018
A new VAT Regulation Introduced in Turkish VAT System for non-resident electronic service suppliers
Some tax amendments has been changed by Revenue Administration with tax law No 7061. From 1 January 2018 according to new VAT regulation, service providers who don’t have residence, office, headquarter and business district in Turkey, they have to be taxpayers which name is called “Special Value Added Tax Liability For Electronic Service Providers” if they make sales their products over the internet to people who are not taxpayers.
The tax administration had brought clarifications on the implementation of the new rules, through the VAT Communiqué no.17, published in the Official Gazette on January 31, 2018. The details are below;
-The non-resident parties that fall within the scope of the new regulation must register as “special VAT liability of electronic service providers” and remit the amount of VAT related to these transactions with a VAT return (the VAT return numbered 3) filed online.
- VAT returns numbered 3 are to be filed monthly, and similar to other VAT returns, the VAT return numbered 3 for each month is filed on or before the close of the 24th day of the following month with the actual VAT amount being payable and paid until the close of business on the 26th day of that month.
-For the first three months of 2018, entities are allowed to file VAT returns numbered 3 until 24 April 2018.
-If the parties do not have any transactions within the subject monthly periods, they do not have to file a VAT return numbered 3.
-A special VAT liability will be established for the service provider, a user code and password will be provided, once the VAT return numbered 3 is filed electronically.
-These entities are not required to have their VAT return numbered 3 approved by a certified public accountant, and are not required to maintain certain records. However, they must calculate the amount of VAT due based on the applicable VAT rate in Turkey for fees paid for electronic services provided to “real persons.”
-In return, the service providers can deduct the amount of VAT paid to the other VAT-payers for goods and services purchased, provided that such goods and services are related to the electronic services provided to Turkish individuals.
- Any related invoices and documents must be maintained pursuant to provisions of tax law.
