Those who want to take advantage of the application will open a business account in banks established in Turkey to collect the sales revenues made online and to withhold these revenues, and all revenue will be collected from here.
Those who want to benefit from the tax exemption granted to those who sell their home-produced products online will first receive a “Tradesman Tax Exemption Certificate” from the tax offices and open an account in a bank.
With the Law on Restructuring Certain Receivables and Amending Certain Laws, enacted in November of last year, the Income Tax Law was amended, giving tax exemption to those who sell their home-produced products online.
According to the regulation, these activities of those who sell their home-produced goods on the internet and similar electronic media without opening a separate workplace and using industrial or mass production machines and tools in their homes will be included in the exemption of tradesmen.
It is envisaged that the aforementioned provision will be applied to revenues starting from 1 January 2021.
The Revenue Administration also prepared a draft communiqué regulating the procedures and principles regarding implementation.
According to the compilation made by the AA correspondent from the said draft, those who want to benefit from the application will apply to the authorized tax office in the place of their residence and obtain a “Tradesman Tax Exemption Certificate”.
These people will open a business account at the banks established in Turkey to collect the sales revenues made online and to withhold these revenues, and all revenue will be required to be collected through this account.
If the revenue obtained in a calendar year exceeds ₺240 thousand for 2021, the tradesman exemption will not be available.
Those who lose the conditions related to the exemption will be taxed in a real way as of the beginning of the following calendar year and will not be able to benefit from the same exemption again. The specified revenue amount will be revalued every year.
In the event that more than one product is manufactured and sold over the internet and similar electronic media, the condition that the revenue obtained does not exceed the amount applicable in the relevant year will apply to the total revenue obtained from all products, not separately for each product type.
Those who are subject to income tax in a real way due to their commercial, agricultural or professional earnings and those who carry out their activities in a way to be loyal to income and corporate taxpayers will not be able to benefit from this exemption.
The entire sales must be made online
In order to benefit from the exemption, it will be necessary to sell home-produced goods through the internet and similar electronic media. No exemption will be granted if some of the sales are made over the internet and similar electronic media and some are made in other ways.
In the draft notification, the transactions to be made by the banks were also specified. Accordingly, a commercial account will be opened by the banks to those who submit the Tradesman Tax Exemption Certificate, in which the proceeds from the sale of home-produced goods to be made on the internet and similar electronic media will be deposited. Banks will withhold income tax at the rate of 4% as of the date of transfer over the amounts transferred to these commercial accounts and will declare and pay the taxes withheld over the transferred amounts for one month with a withholding statement. In cases where the people who benefit from the application employ one or more workers, the withholding rate will be applied as 2%. In order to apply the reduced rate, one worker will need to be employed for at least 10 days per month.
No declaration obligations
Those who benefit from the exemption of tradesmen within the scope of the application will not have obligations such as establishing a liability, document preparation, bookkeeping, and submitting a statement.
The Tradesman Tax Exemption Certificate will be valid for two years and will have to be renewed when it expires.
If it is determined that there is no valid Trades Tax Exemption Certificate, a commercial account is not opened in banks established in Turkey, all the revenue is not deposited in the opened bank account or it is not deposited in the opened bank account or it is determined that the sale of goods are purchased from outside other than home-produced goods, and other stipulated conditions are violated, the tradesmen will not benefit from the exemption and the taxes not collected will be collected with the interest of delay and the tax loss penalty.
Source: AA / Translated by Bazaar Times Team