Since my interview last week on short-term property rentals in Turkey, we have received many questions from our readers. We have therefore continued our research for definitive answers to these questions, as well as other issues we consider to be outstanding. We have also attempted to clarify some of the less clear aspects of the GIYKIMBIL System. In English, this acronym can be interpreted as the Temporary Residential Property Identification Declaration System.
Earlier this week I had the honour of meeting the President of DOKTOB (Dalaman Ortaca Koyceğiz Association of Touristic Hotels and Tourism Organisations), Yücel Okutur and DOKTOB member, Volkan Hacıgümüş. They have been working on the implementation of the law since 2013 in cooperation with the Muğla Governorship, the Muğla Jandarma Command and the Revenue Office (Maliye).
I am told that in terms of local and national security, this issue is now a priority.
Closely monitoring GIYKIMBIL System
Yücel Okutur explained that the Muğla Governorship is closely monitoring the implementation of the law and that the organisation is going to approach the relevant authorities to organise public meetings about the new GIYKIMBIL System, as part of the organisation’s on-going public information activities.
Although this law has been in existence for a long time, due to the on-going worldwide threats to international and national security, the Turkish government have decreed that identity verification of all visitors within the country is escalated to priority status.
Apparently, similar legislation has also been introduced in various European countries, including the UK, in order to prevent terrorist activities.
What is the GIYKIMBIL System?
In Turkish the GIYKIMBIL system is the Geçici İkamet Yerleri ve Kimlik Bildirme Projesi. In English, this can be interpreted as the Temporary Residential Property Identification Declaration System.
The current Mandatory Identification Declaration Legislation 1774, as amended by Law 678, on November 22nd 2016 states:
“Hotels, motels, taverns, pensions, dormitories, Temporary Rental Properties, campsites, camping areas, holiday resorts and similar private or official, billet houses as well as private health establishments, rest and nursing homes, responsible managers of social facilities of religious and benevolent organisations, are obligated to keep the Identity details and entry-exit records of local and foreign guests who have been provided with a place to stay, at night or day time, free or paid, in line with the examples and procedures on a daily basis and to provide the said records to the general policing organisations as well as the State Statistics Institute, when requested.”
With this new legislation, properties that are used for short-term (temporary) rentals are classified as Pensions. These properties, whether they are apartments or houses, require a license. This must be obtained from the Municipal Council in which the property is located. Only Pension/Hotel business license owners can obtain the user name and password required to use the GIYKIMBIL System. As a result, only registered businesses with local municipalities can be included in the GIYKIMBIL system. This is clearly stated on the T1 application form that can be obtained from the Emniyet Müdürlüğü (website of the Directorate General of Security).
Accordingly, irrespective of whether they will operate their property as business or not in the future, property owners who have used their properties for holiday lets (short-term lets-Daily rentals) in the past are required to inform the taxation authorities of this fact in order to take advantage of the tax amnesty for past tax evasion.
The government has declared a tax amnesty on all previous earnings from the rental of the property, providing you have registered your property by the deadline given of June 2017.
Failure to comply will result in previous income received from rental to a third party being consıdered as eligible for taxation. Any advertising of the property in any capacity whatsoever will be viewed for the purpose of this penalty imposition as proof of rental.
For those who decide to cease any future business activity and have applied under the amnesty for tax evasion in previous years within this amendment, the authorities retain the right to monitor for any marketing activity of the property for a period of five (5) years from the date of the declaration.
Once registered, the owners can then continue to operate as long as they comply with the Turkish Business Law (TTK), Turkish Municipalities Laws (Belediye Kanunu) and Ministry of Internal Affair’s GIYKIMBIL system requirements.
Subsequently, as long as there is no payment involved, it is the owner(s) primary (main) residence and there is no evidence of marketing (be it online: via a website, through social media, or by word of mouth), their families, relatives or friends are free to use the property and do not have to inform the authorities of their arrival or departure using the GIYKIMBIL System.
Previously Rented Properties
If you have declared your property as a non-rental entity and are found to be violating this claim, significant fines will be imposed for tax evasion. According to the rules stipulated, you can be charged triple the amount calculated of taxes lost.
Past advertising of any description will be taken as proof of previous rental activity. This includes electricity bills, water bills, social media, word of mouth and online booking sites as well as local and national newspapers.
One must also remember that currently there is a state of emergency in Turkey and officials may ask for IDs or passports and also ask where people are residing (demand an address).
Furthermore, as well as officials, hospitals, pharmacies, hotels and such are connected to the GYKIMBIL system and in the event of an identification check, your declaration on the GYKIMBIL system must match the guests’ declaration.
How to register with GIYKIMBIL system
The owner must apply to the local Police headquarters or the Jandarma (depending on where the property is) with a petition and fill out the necessary forms. However, since the property is classified as a “pension” for the purpose of the law, you need to obtain an operating licence from the council.
Pension licenses are only granted to established companies. For Turkish citizens and foreigners who have work permits in Turkey, sole proprietorship would be acceptable. For foreigners that do not have a work permit, minimum of Limited Company is required to be able to apply for municipality operation license.
The operating licence will enable you to obtain a Facility Number, with which you are issued the password for GIYKIMBIL system. You are also supplied with Software free of charge. However, the software in itself is not enough to enter into the system. The owner will need to purchase interface software to be able to send xml files to the GIYKIMBIL system. If the property is vacant, this too must be declared as part of the daily reporting. Various companies sell the software.
This software is advanced and does the “Daily” sending of guest as well as staff details to GIYKIMBIL database automatically every day, once the initial details are inserted.
Another important point is that if your property is on a residential complex, you must obtain approval of other owners in order to operate a business on site, in accordance with Condominium law.
Currently Rented Properties
As a business, you will be eligible to benefit from a range of incentives, including but not restricted to: discounted utility services and priority status for infrastructure installation and maintenance and various tax incentives and amnesties.
Additionally, all expenses arising from the running of the business will now be classed as tax deductible.
Any inaccuracies found to be within the information provided by either accident or intent will automatically result in a fine.
In addition to this, monthly accounts showing the revenue stream received from rentals must be submitted to the Tax Office. If you declare no income has been received, accounts must still be submitted as evidence of this claim. Income declaration of the business to Tax Office is independent from the GIYKIMBIL system.
What are the fixed costs?
There are a number of fixed costs associated with the scheme. Should you wish to continue renting your property, in order to ensure that you are abiding by the current rules outlined within the amendment; each property owner will be required to instruct the services of an accountant and a legally employed responsible property manager residing in Turkey to communicate with the authorities.
At the time of this article, initial start up costs for registering as a business are approximately 5,000 TL (tax deductible)
On-going costs once registered as a business are approximately 3,000 TL per month excluding income tax (tax deductible), plus 1,128 TL per year as a one off payment (tax deductible).
Don’t get caught out
Please note if your property is not registered and your daily occupancy status is not submitted, you will be deemed complicit and may be liable should the occupants of the property undertake any illegal activity. In the event of this occurring, your villa can be sealed, your guests removed and you may face prosecution resulting in significant fines and/or a custodial sentence.
Government fines as stipulated by the Minister of Internal Affairs
- Failure to register your property 10,383 TL
- Non reporting of daily occupancy status 700 TL per day
- Intentional or accidental inaccurate reporting 5,191 TL
Taxes must be paid
Please note that the above requirements also apply if you are paying tax on income earned from you property or properties in you own country. The Inland Revenue Departments of the UK and Turkey, for example, have an agreement that effectively means they can compare notes. Therefore, you must still register and obtain a form from the Turkish Revenue Office to submit to the UK tax authorities.
I am convinced that this time the Government is serious and will strictly implement the legislation. As such, we advise our readers who have an interest in this subject to register as soon as possible, and certainly before June 2017.
Although it seems complicated at the outset, it will only take a few days to form a company, receive your council licence, and begin using the GIYKIMBIL system.
Who is Doğan Şahin?
Doğan is a graduate of Selcuk University Faculty of Education in Turkey. He lived abroad for about 20 years. He is a Professional English language translator and interpreter accredited by National Accreditation Authority of Translators and Interpreters in Australia (NAATI) and has successfully provided Contracts-Legal translation services to international official and private organizations for over 30 years.
He is registered as an expert witness at Muğla City Justice Commission. He has published four books, two of them being translations. His articles on Tourism, History and Social Life as well as Blue Cruise Holidays have appeared in many journals and newspapers.
Doğan Şahin will be happy to provide the owners with further details to deal with all legal requirements arising from the new legislation, as well as ways to lower the costs of forming a company and running a legitimate short term let business.
Caveat: The details contained in this article on legislation regarding short-term property rentals in Turkey are up to date at the time of publication.
Fethiye Times and the other related parties may not be held responsible for any subsequent changes that do not appear in this article.
For your own convenience
Rather than post comments on this page, should you have any queries or questions please contact Doğan Şahin on firstname.lastname@example.org
Dear readers, This post has certainly won the prize for most comments on a single Fethiye Times story but we think the time has come to draw a line… So we will not be approving or replying to any more comments from now on. If (when) there is any more news about this subject we will be sure to advise you. Meanwhile, if you have any questions please contact Volkan Hacıgümüş direct by email at: email@example.com