Foreign Taxation Consultancy

Yabancıların Vergilendirilmesi Danışmanlığı

Foreign Taxation Consultancy

Foreigners Taxation Consultancy, those who do not have legal and business centers in Turkey will be taxed only on their earnings in Turkey. In limited liability, corporate income consists of the following earnings and revenues:

  • Commercial gains obtained by foreign institutions that have a workplace or have permanent representatives in Turkey in accordance with the provisions of the Tax Procedure Law, or from the works performed in these places or through these representatives, The profits arising from sending them to foreign countries without selling them are not deemed to have been obtained in Turkey.
  • Income from the agricultural business in Turkey,
  • Self-employment earnings in Turkey,
  • Revenues from leasing of movable and immovable properties and rights in Turkey,
  • Security capital gains obtained in Turkey,
  • Other earnings and revenues in Turkey.

Within the scope of tax planning for international/foreign investors, it works together as a solution partner for its customers in terms of uncovering opportunities that customers can benefit from, managing global tax risks, fulfilling cross-border reporting obligations and transfer pricing.

Our expert teams, with many years of experience in the private and public sectors at home and abroad, provide services in planning, reporting and maintaining effective relations with tax authorities on international tax issues, as well as evaluating tax strategies and risks of customers.

In order to manage tax risks and ensure sustainable growth for international/foreign investors, opinions and solutions that support the creation of proactive and holistic global tax strategies are utilized.

Consulting Service in International Tax Planning

SEE: Our Service for International Assignments and Obligations

  • Technical support and consultancy in the creation of investment planning models that provide tax burden optimization with the use of tax technology software of our global company,
  • Consultancy in the tax planning of international investments of multinational companies through continuous exchange of information with our colleagues who are experts in international tax practices in our overseas offices,
  • Tax aspect of international financial leasing transactions,
  • Assessment of international capital, securities and goods movements in terms of tax and other financial liabilities (Exchange, Foreign Trade Legislation, etc.),
  • Free Zones Legislation,
  • Disguised capital analysis in multinational/foreign capital companies,
  • Technical support and consultancy for companies with foreign capital producing projects in the field of large-scale investments (dam construction, tunnel construction, power plant establishment, etc.) in the creation of the most appropriate taxation model within the framework of the provisions of the Turkish Tax and Financial Legislation as well as the Double Taxation Agreements

Consultancy on Double Taxation Avoidance Agreements Legislation

  • Tax analysis of activities constituting a “workplace”
  • Taxation of dividends paid to foreign partners in the states of origin and residence
  • Taxation of royalties paid to foreign institutions (license, know-how, royalty, etc.)
  • Analysis of the tax dimension of payments made to foreign institutions for the services they provide for companies in Turkey
  • Analysis and application of double taxation avoidance methods (exception, offset, etc.) and procedures (mutual agreement, exchange of information, etc.) in different situations
  • Technical support and consultancy in withholding tax refunds within the framework of MLSS

International Transfer Pricing

  • Associated entity transactions analysis
  • Price comparisons
  • Risk analysis and recommendations within the framework of the relevant rules in local and MLBA legislation

The relevant provisions of the Income Tax Law are applied for the above-mentioned earnings, income and income elements specified in Article 3 of the Corporate Tax Law, to be obtained in Turkey and to have a permanent representation in Turkey.

Since the transaction will be made between the workplace or its Permanent Representative in Turkey and the General Directorate of the institution, the invoice must also be given to the Directorate. However, sending the invoiced goods to the head office to another branch of this center abroad will not prevent benefiting from this exemption.

For example; In case the shelled hazelnuts procured from abroad are invoiced to the headquarters abroad, the sacks are filled and sent to the factory of the head office in another country, the institution located abroad will benefit from the export exemption.

If self-employment income is obtained within the scope of commercial activities carried out in Turkey, the provisions applicable to full-fledged companies will be applied in determining the corporate income. In the case of self-employment earnings of non-resident companies that receive commercial income from their workplaces or their permanent representatives in Turkey, earnings and incomes of non-resident companies from their workplaces or permanent representatives in Turkey will be considered as commercial income. According to Article 30 of the Corporate Tax Law, no tax deduction will be made on professional income.

If there are institutions that do not have a workplace or permanent representative in Turkey, or that have a workplace or permanent representative but are not related to them, that carry out self-employment activities in Turkey or that evaluate this activity in Turkey, these deducted taxes can be deducted from the tax calculated in the tax return.

The only condition for limited taxpayer institutions to obtain securities capital income in Turkey is that the capital is invested in Turkey. Capital invested in Turkey means bringing it to Turkey as capital, giving it as a loan in Turkey or making a profit in Turkey by similar means. Profit share, interest, rent and similar incomes obtained in return for this invested capital will be the securities capital income of the limited taxpayer institution in Turkey. In case of income obtained from securities within the scope of commercial activities carried out in Turkey, the provisions applicable to fully responsible institutions shall be applied in determining the income of corporations. Therefore, the income obtained from the securities that have a workplace or a permanent representative in Turkey and obtained from the transactions made in these places or through these representatives are subject to Income Tax. It will be taxed according to the explanations in the General Communiqués.

In this respect, if a non-resident company that does not have a permanent establishment or permanent representative in Turkey obtains securities capital income, the taxation duties of these earnings will be fulfilled by those who provide income to the foreign company or those who act as intermediaries.

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