Title deed transactions under retroactive scrutiny: 53 percent penalty for those who fail to voluntarily correct their deeds!

The Ministry of Treasury and Finance has scrutinized title deed transactions for the last five years using the AI-powered Spatial Data Analysis System (MEVA). If a difference is detected between the price shown on the title deed and the actual sales price in real estate sales, both buyers and sellers will be penalized. Those who make voluntary corrections will be exempt from paying any fines; otherwise, they will face a tax penalty of the original tax, a loss penalty, and a 53.25% late payment interest.

The Ministry of Finance has launched a new measure targeting those who evade taxes by undervaluing their land titles. A retrospective review covering the past five years has been launched.

According to a report in Hürriyet , the title deed fee for real estate sales is 4 percent of the total purchase price. The buyer pays 2 percent of this fee, and the seller pays the remaining 2 percent. If an understatement is detected, both the buyer and seller will be required to pay the tax they have underpaid, along with penalties and interest.

Economist Muhammet Bayram , who noted that the current annual late payment interest rate is at 53.25 percent, emphasized that citizens could face "multiple" penalties if a missing payment from five years ago is detected.

Bayram stated that the responsibility for the title deed fee lies with the buyer and seller, but that real estate agents may also have to pay a penalty tax if they understate their commission income. He added, "In cases where the commission invoice is issued based on the market value and the remaining portion is collected in person, if this difference is detected, the tax will be collected retroactively."