Rental income tax and rent declaration started to take place on the agenda with the month of March. Rental declaration is submitted in March every year. It is not necessary to submit a declaration for rental income from residences / workplaces below a certain amount. Family members must submit separate declarations for properties in their own name and from which they generate income. So, when, how and where is the rental income statement given/paid? Here is the rental income tax payment date of 2023…
Among the subjects that the owners of residences, workplaces, land, land, etc. concentrate on, is the rental income tax deadline. Rental income provided throughout the year is declared in March each year. If the total rental income is ₺9,500 or less in 2022, you do not need to declare or pay taxes. However, for rental income above this amount, you must file a declaration and pay taxes. Otherwise, a fine will be applied.
WHAT IS THE RENTAL INCOME TAX?
According to the Income Tax Law, if a person rents the real estate he owns to someone else and earns income from this rental, this income is considered as “real estate capital income”, which is known as “rent tax” among the people. What is meant by “real estate” that is rented out is residences, houses, workplaces, plots, land, summer houses, villas or places used for similar purposes.
WHEN AND WHERE CAN YOU GIVE THE RENTAL INCOME STATEMENT?
Those who earn rental income can submit their income statements by going to the tax office in the region of their residence or by filling out their returns through the ‘Ready Declaration System’ on the website of the Revenue Administration (GIB) via the e-Devlet (e-Government) system. Taxpayers are required to submit their declarations from the 1st day of March 2023 to the evening of the last day of March 31st for the real estate capital gains income subject to declaration for the period of 1 January – 31 December. While calculating the amount of tax to be paid, the exemption amount and expenses can be deducted from the rental income.
WHERE AND HOW IS THE RENTAL INCOME STATEMENT PAID?
Income tax returns can be paid via the “Ready Statement System” from the electronic applications of the Revenue Administration (GIB) without going to the tax office. The Ready Statement System can be accessed 24 hours a day, 7 days a week. Rental tax can also be made from the Internet Tax Office without going to the tax office. The income obtained will be declared in March of the year following the year in which the income is obtained, and the calculated income tax is paid in two equal installments in March and July.
HOW MUCH IS THE RENTAL INCOME TAX EXEMPTION LIMIT?
Pursuant to the Income Tax General Communiqué No. 317, effective January 1, 2022, the exemption limits from rental income tax for the rental income obtained for the year 2022 are ₺9,500 for the places rented as residential. Those whose rental income is below this amount do not need to pay rent tax.
WHAT IS THE LIMIT IN WORKPLACE RENTAL INCOME?
For those whose income that is subject to declaration exceeds ₺70 thousand (rent, income from securities, interest, etc.), the workplace rental income tax return limit is ₺70 thousand. After these amounts, the rental income tax rates on the remaining base can start from 15% and go up to 40%.
HOW MUCH IS THE RENTAL INCOME TAX EXCEPTION?
Those who earn rental income from housing in 2022 will benefit from an exemption of ₺9 thousand 500 if they declare this income to the tax office in due time. For example, when retired aunt AySe, who earns ₺2 thousand per month (₺24 thousand per year) in 2022, declares her rental income to the tax office, the exemption amount of ₺9 thousand 500 is deducted from this ₺24 thousand. So it is taxed on less amount. In addition to rental income, those who earn commercial income from activities such as the operation of markets, restaurants, etc., those who earn agricultural income or those who earn self-employment such as lawyers and doctors cannot benefit from the exemption application. This exception applies only to rental income from the residence. It does not apply to workplace rental income.
- A person with a total rental income of ₺40,000 and a workplace rental income of ₺55,000 must submit a declaration regarding both residential and workplace rental income, since the total rental income from residence and workplace exceeds ₺70,000.
- A person with a total rental income of ₺20,000 and a total rental income of ₺45,000 from a workplace, since the total of his housing and workplace rental income does not exceed ₺70,000, only needs to submit a declaration regarding the rental income of the residence.
RENTAL INCOME TAX SAMPLE CALCULATION
The tax rate is applied to the remaining amount after the rental income amount is written in the declaration and then the exceptions, expenses and discounts are deducted from this income. While the rate of 15% is applied up to ₺32 thousand, the tax is calculated by applying the rates of 20%, 27%, 35% and 40%as the income increases.
In the lump-sum expense method, the amount of tax that property owners will pay for their rental income in 2022 can be seen in the table below. For a monthly rent of ₺2 thousand 500 (₺30 thousand per year), the property owner will have to pay ₺2 thousand 933 of income tax. First, the exemption (₺9 thousand 500) and then the 15% lump-sum expense (₺3 thousand 450) are deducted, and the tax is calculated over the ₺19 thousand 550 base, at a rate of 15%.
Source: Cnnturk / Prepared by Irem Yildiz