Skip links

Turkey VAT on foreign B2C digital service providers

Turkey introduced Value Added Tax liabilities on non-resident providers of digital services to its consumers from January 2018. There is no VAT registration threshold, but there is a simplified registration process for foreign providers of digital or electronic services with the Turkish Revenue Administration. B2B services are treated under the reverse charge mechanism, with the Turkish business customer being responsible for reporting the VAT.

What e-services are liable to Turkish VAT?

There is no clear definition of digital services in Turkey. But practically, it include income from the following services liable to VAT:

  • Downloads or streaming media
  • E-books
  • Website hosting
  • Telecoms data services, including texting
  • Broadcast TV and radio

Check our global VAT and GST on digital services tracker to see which other countries have introduced indirect taxes on electronic services to consumers.

Determining if customer resident in Turkey

Non-resident providers must determine if their consumers are located in Turkey – or consuming the service there under the Destination Basis. They may reply on the following evidence:

  • Customer billing address
  • Telephone country code
  • IP address of laptop, mobile phone etc
  • Address of paying bank or credit card

Turkey VAT compliance for e-services

There is no VAT registration threshold in Turkey for resident or non-resident businesses. Providers must register for VAT with the Revenue immediately.  This can be done online through a simplified registration process for e-services. As with regular Turkish VAT returns, foreign taxpayers should file quarterly returns (VAT Return form 3), due by the 26th of the month following the reporting period. Any VAT due should be paid at the same time. Returns must detail VAT due in local liras, based on the exchange rate of the Turkish central bank at the time of the supply. In periods where there are no transactions, a VAT return must still be filed.

Turkey operates a Partial Withholding VAT regime where non-residents provide services to taxable and non-taxable customers. However, this does not apply to digital services.

Europe VAT on digital services

Country (click for details) Rate Date Threshold Comments
EU 27 member states 17% to 27% Jan 2015 €10k EU residents; Nil for non-EU
Albania 20% Jan 2015 Nil
Andorra 4.5% Jan 2015 Nil
Belarus 20% Jan 2018 Nil
Georgia 18% Oct 2021 Nil
Iceland 24% Nov 2011 ISK 2 million
Kosovo 18 Sep 2015 Nil
Moldova 20% Apr 2020 Nil
Norway 25% Jul 2011 NOK 50,000
Russia 16.67% Jan 2017 Nil B2C & B2B
Serbia 20% Apr 2017
Switzerland 7.7% Jan 2010 CHF 100,000 on global income
Turkey 18% Jan 2018 Nil
Ukraine 20% Jan 2022 UAH 1m
UK 20% Jan 2015 Nil

Leave a comment