In Turkey, many supports are offered in order to accelerate the urban transformation campaign carried out for the renewal of buildings at risk and to offer comfort to citizens. In addition to demands such as rental assistance, loan interest subsidy and 1% Value Added Tax (VAT), buildings constructed under the Urban Transformation (Law No. 6306) have been exempt from taxes and fees thanks to a regulation adopted in 2018.
RIGHTS AND TAXES
In accordance with article 24 of the law amending the law on the environment and certain laws published in the Official Gazette of December 10, 2018, it is specified that people who buy a house from the urban transformation project do not pay the title deed fees. to a fee waiver.
THE VICTIM IS EXPERIENCED
Despite the exemption that has been in place for about 4 years, some cadastral offices, municipalities and notaries may charge fees and taxes for the first sale, transfer, registration and mortgage establishment of urban transformation houses. As this situation creates many conflicts, most disputes are brought before the courts. Court decisions are generally in favor of citizens and can be made retroactively.
WHAT PAYMENTS ARE EXCLUDED?
Notary fees, land registration fees, fees and charges levied by municipalities, inheritance and transfer taxes, working capital and other fees, stamp duty, money to be collected in favor of loans granted under urban transformation, tax on banks and insurance transactions.
THE INCREASE IN HOUSING AID IS ON THE PROGRAM
Recently, high rents have been on the nation’s agenda. In the context of urban transformation, the rental assistance granted between 750 and 1,050 liras depending on the province was insufficient according to market conditions. Minister of Environment, Urban Planning and Climate Change, Murat Kurum, who attended the groundbreaking ceremony for urban transformation works in Kartal, Istanbul, received a request from the people of the region to increase their rent assistance. The Minister for the Institution gave instructions there to update the figures.
WHAT OTHER INCENTIVES ARE THERE?
- The Ministry of Environment, Urban Planning and Climate Change provides loans of up to 160,000 liras to citizens who will strengthen their buildings, and up to 400,000 liras for housing construction, housing, businesses and work loans.
- The loan also provides an interest subsidy of up to 400 basis points.
- While housing loans in public banks are applied at 1.29% over 120 months, this rate decreases to 0.88% in energy-efficient housing and 0.96% in standard housing with the bonus of interests of the ministry.
- The monthly installment of the citizen, who will pay 6,000,571 liras in a loan of 400,000 liras, decreases to 5,000,410 liras. The benefit of the citizen is 139 thousand 276 lire.
- The value added tax (VAT) is applied at 1% for those who transform their house.
- Rental assistance is provided for up to 18 months in a risk structure. Rental assistance varies between 750 and 1,050 lire depending on the province. Only one of rental assistance or loan assistance can be used.
HOW CAN I RETURN?
FREQUENTLY ENCOUNTERED
Mono Law’s founding lawyer, Hanife Emine Kara, explained what needs to be done to ensure that those who pay fees and taxes under urban transformation recoup that payment. Expressing that although there is an exemption of title deed and notary fees in urban transformation according to Law No. 6306, some cadastral directorates and some municipalities do not apply the exemption and very often encounter this situation , Kara said that the exemption is not applied not only to owners but also to independent parts sold by the contractor to citizens.
CASES WITHIN 5 YEARS
Emphasizing that if the exemption is not applied, both the contractor and the owners must pay the said amount with reservation, Kara said: “Then a request must be made to the tax office for reimbursement of the fees paid. The tax offices mainly refund these fees paid. However, if there are amounts that the tax office does not reimburse, the fees paid can be recovered by taking legal action in the tax courts. “This case should be open within 5 years,” he said.
VALID FOR SALE TO A THIRD PARTY?
Hanife Emine Kara said the exemption is only valid in the early periods, and said, “In other words, when the independent section purchased from a project under urban transformation is sold to a third party , there will no longer be any waiver of fees.”