Turkish finance ministry cracks down on undeclared rental income

The Ministry of Treasury and Finance has intensified its crackdown on undeclared rental income, identifying approximately 700,000 taxpayers who failed to file the necessary tax declarations.

This enforcement follows the end of the rental income declaration period, during which 1.2 billion Turkish lira, which is $35.4 million in taxes were declared, according to Treasury and Finance Minister Mehmet Simsek.

Government’s rigorous inspections continue

Minister Simsek detailed that the Revenue Administration (GIB) has implemented numerous initiatives since the beginning of the year to identify and inform those required to declare rental income.

This includes a specific focus on properties rented above a certain threshold, short-term rentals such as daily and weekly accommodations, and business property rentals, which must be collected through bank transfers.

“The Revenue Administration conducted extensive monitoring of IBAN accounts to ensure compliance, sending informational and reminder SMS messages to around 700,000 taxpayers,” Simsek stated.

We also launched physical inspections across 1.5 million properties potentially rented out, based on data from land registry and civil records.

Treasury and Finance Minister Mehmet Simsek

Extensive inspections yield results

Minister Simsek revealed that over 400,000 properties were physically inspected by tax officers, resulting in tax assessments and penalty notices totaling approximately 153.4 million TRY ($4.5 million) for those who failed to file declarations.

In response to these inspections, 46,000 taxpayers voluntarily submitted declarations, contributing an additional 200.7 million TRY ($5.9 million) in income taxes.

Final reminders, penalties loom

After the declaration period ended, GIB issued additional reminders to around 1 million taxpayers, including those who received rental payments via IBAN or cash but failed to file declarations.

This effort resulted in 95,989 taxpayers declaring an additional 18.3 billion TRY ($540 million) in tax base and 1.2 billion TRY($35 million) in taxes.

However, approximately 700,000 taxpayers still have not complied. These cases will now be forwarded to relevant tax offices for penalization.