Tax exemption: Properties that have been owned for 5 or more years are free of capital gains tax when sold.
In all other cases capital gains tax is calculated in the following way:
Imagine a property is bought in 2010 for 100,000TL.
Each year an allowance for inflation is added to the value of the property. The government decides what % rate this inflation is each year.
For the sake of this example we will assume that the rate is 10% every year.
2011 – land value – 100,000TL
2012 – land value with 10% inflation – 110,000TL
2013 – land value with 10% inflation – 121,000TL
At the beginning of 2014 the land is sold for 150,000TL. The difference between the original price and the sales price is 50,000TL, however the difference between the inflation adjusted price and the original price is 29,000TL.
Additionally the government also give a further allowance of 10,600TL of profit that is not taxed. Therefore 18,400TL is the amount of profit that the capital gains tax will be charged on.
The tax on 18,400TL will be worked out in the following way.
This is taxed in the following way:
The first 0 – 12,000TL is taxed at 15%
The next 12,000 – 29,000TL is taxed at 20%
The next 29,000 – 66,000TL is taxed at 27%
Any profit over and above 66,000TL is taxed at 35%
Note: This information is correct as of 2015 and will be updated following any changes in taxation laws.