How to Buy Property in Turkey Without VAT: A Step-by-Step Guide to the KDV Exemption

15.11.2025 268

Looking for a legal way to save 10–20% when buying an apartment or villa in Turkey?
The answer is the VAT exemption under Article 13/1-i of the KDV Law.
Below is a clear step-by-step guide explaining who qualifies, which properties apply, how to pay correctly, what documents to collect, and how to avoid losing the exemption.

What is KDV and the 13/1-i exemption: in simple terms

KDV (Katma Değer Vergisi) is Turkey’s Value Added Tax (VAT). In real estate, the rates are 1%, 10%, or 20%, depending on the project type or category.
For buyers, this can be a significant portion of the purchase price.

Primary real estate (ilk teslim) — the key to exemption

The 13/1-i VAT exemption applies only to the first sale directly from the developer (“ilk teslim”).
If the property has been sold before (i.e., secondary market), the exemption does not apply.

Who qualifies: non-residents, expats, and Turks living abroad

Foreign individuals who are not permanent residents of Turkey.
Turkish citizens living abroad for 6+ months, supported by official documents.

How to prove non-residency

Acceptable documents include:

Certificate of residence abroad,
Passport stamps showing border crossings,
Letters from a consulate or embassy.
Provide at least two proofs of non-residency.

Eligible properties: new projects from developers (konut / işyeri)

Qualifying properties:

Apartments, villas, or offices,
Sold by a legal entity (developer),
First delivery (ilk teslim) only.

Ask the seller for:

Written confirmation of ilk teslim,
Correct invoice stating “KDV hesaplanmamıştır” (“VAT not charged”),
Clear property type (konut = residential, işyeri = office).

Not eligible: resales, transfers, special cases

The exemption does not apply to:

Secondary market or resale properties,
Private individual sales,
Special sales schemes outside Article 13/1-i.

Correct payment method: currency, SWIFT, DAB, 50%/50% timing

To qualify for the exemption, payment currency and timing are crucial.

You can pay in full or choose installments (up to 12 months).

At least 50% of the price must be paid before the invoice is issued.
The remaining amount must be paid within 1 year after the invoice date.
Payments must be made in foreign currency transferred into Turkey through a bank.

The buyer must send money from a personal account abroad directly to the developer’s account, or first to their own account in Turkey (via foreign transfer) and then pay the developer.

Required documents:

SWIFT confirmation,
DAB (döviz alım belgesi – foreign exchange receipt),
Bank statements,
Correct payment description.
If paying in cash, keep a customs declaration.

Common payment mistakes that cancel the exemption

Payment from a TL (Turkish Lira) account without imported currency,
Invoice issued before money is received,
Transfer from third-party accounts without proper documentation,
Less than 50% paid before invoice issuance.

Legal aspects: 3-year restriction in Tapu, Communiqué No. 42

After registration, a 3-year restriction (şerh) is placed on the Tapu (title deed) — the property cannot be sold for 3 years.
If sold earlier, VAT + penalties must be paid as if no exemption was applied.
Communiqué No. 42 (28 May 2022) clarifies detailed procedures and control rules.

When the restriction is lifted and what happens if sold early

After 36 months, the restriction is removed, and the property can be freely sold.
If sold before 3 years, the buyer must pay the full VAT and interest retroactively.

Step-by-step transaction process

Choose a property from the developer (confirm ilk teslim).

Note: Not every new property qualifies for the VAT exemption — a professional agent (e.g., Reptur) can verify eligibility.
Reserve the property and agree on terms (price, payment plan).
Open a Turkish bank account and obtain a tax ID (Vergi Numarası).
Transfer foreign currency via SWIFT, receive DAB.
Pay 50% before invoice, remaining within 1 year.
Sign contract with “KDV 13/1-i” clause, get correct invoice (“KDV hesaplanmamıştır”).
Register the deed (Tapu) with a 3-year restriction.
Receive keys and occupancy permit (iskân).
Keep full documentation set for 5 years.

Document checklist

Passport + notarized translations (if required),
Turkish tax number (Vergi Numarası),
Sales contract with “KDV 13/1-i” note,
Invoice stating “KDV hesaplanmamıştır”,
SWIFT confirmations, DAB, bank statements.

Financial examples: how much you save with the exemption

Case: $200,000 property, 10% VAT rate

Regular purchase: VAT ≈ $20,000
With exemption: VAT = $0 → Save $20,000

Case: $500,000 property, 20% VAT rate

Regular purchase: VAT ≈ $100,000
With exemption: VAT = $0 → Save $100,000

Quick formula:
Property price × VAT rate = Your savings (if 13/1-i fully applies).

Cities & locations: Istanbul, Bodrum

Istanbul — wide range of premium & business projects, strong rental market.
Bodrum — villas, townhouses, popular for seasonal stays.

Investment logic: rent and resale

If planning resale, remember the 3-year restriction (şerh).
After 3 years, resale is allowed — calculate possible capital gains tax in advance.
After 5 years of ownership, capital gains are usually tax-free in Turkey (confirm with your tax advisor).

Risks: always verify the project

Developer’s license, background, and completion record.
Land registry and encumbrance checks.
Contract wording (correct “KDV 13/1-i” clause).
Traceable payments (SWIFT, DAB, statements).

FAQ about KDV 13/1-i — Key answers

Can I apply the exemption to resale? — No, only first delivery from developer.
Can I pay in TL? — No, payments must come as imported foreign currency (with DAB).
Why must 50% be paid before invoice? — It’s a formal legal requirement.
What if I sell before 3 years? — Full VAT + penalty applies.
Does it apply to offices (işyeri)? — Yes, if it’s first delivery and payment rules are met.
Can I buy through power of attorney? — Yes, with a notarized Turkish POA.
Where to read official rules? — On the Turkish Tax Authority (GİB) website.

Personalized VAT-Free Deal Plan — in 24 Hours

Want to know if your property qualifies for the KDV 13/1-i exemption?
Book a consultation — in 24 hours we’ll prepare a personalized plan:
verify ilk teslim, payment schedule (50% / 1 year), collect SWIFT/DAB,
and draft the correct contract & invoice wording with an action timeline.

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