Turkey’s Revenue Administration has issued Guidance No. 583, detailing how capital gains from real estate sales are taxed, including calculation methods, exemptions, acquisition dates, and the declaration and payment process for gains realised within five years.
Turkey’s Revenue Administration has issued Guidance No. 583, outlining the taxation of capital gains from the sale of real estate. The guidance details the rules, calculation methods, and declaration procedures for income tax on gains realised from disposing of property within five years of acquisition.
Scope of taxation and the Five-Year rule
Capital gains arise when real estate, including buildings or land, purchased for consideration is sold within five full calendar years from the acquisition date. Properties acquired gratuitously, such as through inheritance or donation, are exempt from tax regardless of the holding period. Income from property trading conducted continuously as a profession or through a registered commercial entity is classified as commercial gain rather than capital gain.
Calculating taxable net gain
The net gain is determined by subtracting the indexed acquisition cost, disposal expenses, and any taxes or fees paid from the total sales price. Acquisition costs can be adjusted for inflation using the Domestic Producer Price Index (Yİ-ÜFE) if the index increase between the month before acquisition and the month before disposal is at least 10%. For the 2025 tax year, the first 120,000 TL of capital gains is exempt, and only the amount exceeding this threshold must be declared.
Determining the acquisition date
The acquisition date is generally the date the property is registered in the title deed. In some cases, such as housing from cooperatives or the Housing Development Administration (TOKİ), the date the property is delivered for actual use may be accepted as the acquisition date if supported by utility bills or delivery reports. For land converted into plots or where a new building is constructed, the registration date of the new status in the title deed is considered the acquisition date.
Declaration and payment process
Gains exceeding the exemption threshold for 2025 must be declared between 1 March and 31 March 2026. Taxpayers can use the pre-filled electronic system, Hazır Beyan, to review and approve tax returns online or via mobile application. The calculated tax may be paid in two equal instalments, with the first due by 31 March 2026 and the second by 31 July 2026. Taxpayers may also deduct certain expenses, including education and health costs (up to 10% of income), life insurance premiums, and approved charitable donations.
Treatment of losses
Losses from real estate sales cannot be offset against other types of income, such as salary or rental income. However, these losses may be offset against capital gains within the same category for up to five subsequent years.
