What is the difference between property tax and real estate tax in Turkey?
For those wishing to buy a property in Istanbul or Turkey in general, when it comes to real estate taxes versus property taxes, some may ask about the difference? Which is nothing.
The IRS uses the term “real estate taxes”, but most people use “property taxes” for the same meaning
Both terms refer to money paid to state or local governments due to taxes levied on immovable land.
And “property taxes” are the real estate taxes paid on your home or property. However, there are many different types of property that an individual can own – and each type of property is taxed differently.
There is also what is known as personal property taxes. Unlike real estate taxes and property taxes, personal property taxes refer to movable property, such as the car you drive to work. These items are taxed differently than real estate.
When referring to immovable assets, such as a home, real estate taxes and property taxes are synonymous.
But taxes on personal property are not.
Here are some ways to compare these terms:
- Property taxes and property taxes refer to fees levied on immovable property, also known as real property.
- Personal property taxes refer to fees levied on movable property, such as boats, vehicles, or aircraft.
- The IRS uses the term “property taxes,” while consumers often use the term “property taxes.”
- Both personal property and estate taxes are paid at the state or local level.
- Personal property and real estate taxes usually go to finance community projects, such as schools, roads or infrastructure
Types of property taxes in Turkey
In general, taxes on real estate in Turkey are relatively low compared to other countries, where taxes on real estate in Turkey when purchased in total range from 5% to 6% of the value of the property, while in other countries it reaches 10% or 20% of the value of the property.
Among the most important types, remember
Title Deed Transfer Tax (Tapu)
This tax is paid once when the title deed is transferred from the seller’s name to the buyer’s name, which usually amounts to 4% of the property price registered in the sales contract. And this tax is often divided equally between the seller and the buyer, so that the seller pays 2% and the buyer pays 2%
Property Ownership Tax in Turkey
And equivalent to 3.9% of the price of the property is also paid once.
Annual property tax
The Turkish government imposes an annual tax on property owners for their municipality, which is estimated at approximately 0.003 of the value of the property, and this tax is in return for the services provided by the municipality to the residents.
Compulsory insurance for earthquakes and natural disasters
Earthquake and natural disaster insurance on homes is mandatory in Turkey, unlike general insurance
Most Turkish banks offer an earthquake and natural disaster insurance service called DASK