When a real estate transaction is registered at a value lower than its actual market price, the Turkish tax authorities can impose significant penalties and interest on the unpaid amount. Under Turkish tax law, both the buyer and the seller are legally responsible for any missing tax payments.
Consequences of Declaring a Lower Property Value
If it is determined that the property price was underreported in the title deed, the difference will be subject to additional tax payments with interest.
✅ The missing title deed fee (tapu harcı) is recalculated based on the actual property value.
✅ A tax penalty of 25% is applied to the unpaid fee.
Example of a Penalty Calculation
📌 If a property is registered at 1 million TL, the title deed fee would be 40,000 TL (4%).
📌 However, if the actual sale price is 6 million TL, the correct fee should be 240,000 TL.
📌 The missing amount of 200,000 TL will be collected with interest.
📌 Additionally, a 25% penalty (50,000 TL) will be imposed.
Who Is Responsible?
🔹 Even if the buyer usually pays the title deed fee, both the buyer and the seller are legally liable for any missing payments.
🔹 If a company sells the property, they may also face corporate tax penalties.
🔹 A capital gains tax may also be applied if the difference in declared value is identified.
Final Thoughts
Declaring a lower value on title deeds may seem like a way to save on taxes, but it can lead to serious financial penalties and legal consequences. Buyers and sellers should always report the real market value of the property to avoid costly fines and future legal issues.
