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Legislation - CottGroup Holistic Business Services

17April2013

How to Calculate Stamp Tax in the Event of a Lease Contract Transfer?

Reference: Veysi Seviğ - Bumin Doğrusöz

Stamp Tax In The Event Of A Contract Extension

I want to extend the lease term of the apartment I live in for another year starting from August. However, the landlord says this would be subject to stamp tax. Is this correct?

In case the current lease agreement is valid for one year and there is a provision in the part covering special conditions for the lease contract to be extended for the same duration, if the parties consent to, and you decide upon extending it for a year, then the extension is subject to stamp tax. Thereby, according to the Stamp Tax Law, parties must fulfill the liability. By force of the third paragraph of Article 14 of the Stamp Tax Law, in the event of the contract extension, the same amount or same proportion is collected as tax. By this provision, the current lease agreement between you and the owner is now extended for a year, and this transaction you conduct is the status of redetermining the current lease duration by extending it for a year.

Additionally, as it is known, the stamp tax rates increased in 2010 and the rate to be applied in lease contracts is 1.65 per thousand. This rate will apply for the annual rent as you extend the contract for a year.

Posted in Taxation Law

12April2013

Social Security System in Türkiye

PENSION AND HEALTH (MANDATORY)

SGK = Social Security in Türkiye

There is an e-declaration which is sent regularly at the end of following month, which is called “aylık hizmet bildirimi” in Turkish. As mentioned above, clients must provide the power of attorney regarding the password in case the payroll provider will communicate directly with this party. In case there is no edeclaration password a proxy letter is required instead. As mentioned above, the payment date is until the end of following month, and the local payroll provider will be able to pay the premiums on the client’s behalf, as explained above too. The total amount must be paid in local currency (TRL – Turkish Lira).

Bank payments are possible but the client must have a local bank account.

Liability for Social Security:

Social Security contributions are calculated on a monthly basis of monthly wages that are paid jointly by the employee and the employer. Please find below the rate percentages table;

 
Employee
Employer
Contribution
14 %
19,5 %
Unemployment Contribution
1 %
2 %
Total
15 %
21,5 %
Discount**
 
5 %
Total Discount Included
15 %
16,5 %

**If the Social Security premium payments are made on time, the employer entitles to the discount.

The rates are applied to social security base which is comprised gross wages, bonuses, and other taxable payments. However there is a ceiling base which is 6360,90TL for the first half of 2013 and the first half of 2013 and 6639,90TL for the second half of 2013.

Posted in Social Security Law and Legislation, Taxation Law, Labor Law

12April2013

What is MSD (AGİ) in Türkiye

What is MSD (AGİ)

The Minimum Survival Discount (MSD) has been applied within the framework of principles determined in account of the tax to be paid by the employees in accordance with the income tax law. The calculated MSD sum is paid to the employee by being deducted from the income tax to be paid by the employee. The MSD sums are calculated by considering the marital status of the employee, number of children the employee is obliged to look after and the minimum wage determined at the beginning of calendar year, and amendments made in the minimum wage in a year do not cause any change in calculation of MSD. If employee's child is over 18 years old, the employee can not take advantage for him. But if the child is studying in university, the employee will be benefit from his child's age will be reached up to 25.

Posted in Social Security Law and Legislation, Labor Law

11April2013

Advantages of Renting a Car for Employees

Advantages of Renting a Car for Employees / Şükrü Kızılot 11.04.2013

Renting a car for employees is not actually a new practice; yet, it became popular recently due to the advantages it brings.

The Differences Between Purchasing And Renting

There are many advantages to renting a car rather than purchasing one for the company and registering it. Let’s explain the subject and start with the purchasing activity.

1- Purchasing a Car for the Company

a) For the cars purchased within a certain year, it is not possible to amortize them for the year they were purchased, in other words, for 12 months. For the period between the month the car was purchased and the end of the year, it is possible to calculate the monthly amortization and record it as an expense (Article 320 of Tax Procedure Law).

b) The value added tax paid during the purchase cannot be subject to reduction. It can qualify either as an expense or a cost. (Law on Value Added Taxes Article 270/2)

Posted in Taxation Law

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