Horizon Beauty Logo
The Ministry of Treasury and Finance (Revenue Administration) has announced the implementation of the Digital Service Tax and accommodation tax, which will enter into force on 1 January 2023.
According to the Law, accommodation facilities include hotels, motels, holiday villages, pensions, apart hotels, guesthouses, camping, chalets, and highland houses.
Regardless of its type, class, quality, descriptions and definitions in the relevant legislation, all facilities providing accommodation services are subject to tax. This includes hotels, holiday villages, boutique hotels, private accommodation facilities, motels, hostels, apart hotels, and wellness facilities.
In practice, all facilities that offer overnight services, regardless of whether they have a tourism operation certificate and/or a business opening/operation certificate, are subject to tax.
Overnight services provided to those in need of protection, care and assistance are not subject to tax.
Overnight service provided in accommodation facilities is subject to tax. The service provision begins when the room is left to the person’s disposal to perform the overnight service.
Person A entered the accommodation facility on 24/5/2023 for overnight stay and paid the overnight stay. The accommodation tax was calculated on the accommodation invoice.
Example 2: Person (C) entered the hotel to stay for 7 nights, but left the facility after only 3 days.
All services offered within the accommodation facility by being sold together with the overnight service are subject to accommodation tax. This includes food, beverage, activity, entertainment services, and the use of pool, sports, thermal and similar areas.
In determining whether food, beverage, entertainment services and other similar services are offered together with the overnight service, issues such as whether they are offered within a predetermined accommodation concept are taken into consideration.
In concept sales, which include services outside the facility, a separate invoice is issued for the services provided, and accommodation tax is not calculated over these services.
The accommodation tax is not calculated over circumcision, wedding, cocktail, meeting, congress, symposium and similar organization services provided in accommodation facilities.
Even if the hostel operator shows the breakfast service separately on the accommodation invoice, it is still subject to accommodation tax.
When a private accommodation operator sells a balloon tour together with a three-night all-inclusive stay, the accommodation tax is not calculated for the balloon tour.
Dry cleaning services provided by a motel operator to guests staying in the facility are not subject to tax if they are not sold together with the overnight service.
Example 4: The entertainment services provided by the holiday village operator are not subject to accommodation tax if they are not sold together with the overnight service.
The taxable event in accommodation tax occurs with the provision of services that fall under the tax.
In cases where invoices are issued before the service is rendered, the taxable event does not occur. Therefore, the taxable event occurs when the service is offered to the host.
For accommodation services that spread over more than one taxation period, the taxable event is deemed to have occurred as of the last day of the relevant taxation period.
In cases where the operators of the facility, their relatives or business personnel benefit from accommodation services free of charge, the taxable event is deemed to have occurred.
According to Article 34 of the Law, the payers of the accommodation tax are those who actually operate the facility where the accommodation services are provided.
Accommodation tax liability is established prior to the commencement of operations, and is determined by the tax office to which the operator of the accommodation facility is affiliated in terms of value added tax (VAT).
Services provided to students in student dormitories, hostels and camps are exempt from tax. However, services provided to non-students in these places are taxable and must be declared with the Accommodation Tax Declaration.
According to Article 34 of the Law, services provided to diplomatic representations and consulates of foreign states and their members with diplomatic rights are exempt from tax.
The Ministry of Foreign Affairs gives a document to persons and organizations that will benefit from the accommodation tax exemption, and the accommodation taxpayer is requested not to apply accommodation tax in this transaction.
Accommodation taxpayers enter information on the service provided under the diplomatic exemption in the Accommodation Tax Declaration.
The base of the accommodation tax is the sum of the money, goods and other forms of benefits, services and values received or owed for the services included in the subject of the tax, excluding VAT.
If the price is calculated in foreign currency, the foreign currency is converted into Turkish currency at the current exchange rate.
Example 1: The holiday village operator will show the Turkish lira equivalent of 200 Euros on the invoice to person B.
The hotel operator sold five nights of three rooms to an agency for 20,000 Turkish liras excluding VAT on 9/1/2023. The agency sold the rooms to a tourist group for 22.000 Turkish liras excluding VAT on 15/5/2023.
The accommodation tax base is determined by determining the cost of accommodation and other services provided outside the facility, using an objective method.
In case the price of accommodation service is other than money, the tax base is determined in accordance with Article 267 of the Tax Procedure Law.
The rate of accommodation tax is 2%. The President is authorized to increase this rate up to one fold.
According to the law, accommodation tax is shown separately in the invoices and similar documents issued by the accommodation facilities. This tax is not included in the VAT base.
A holiday village operator sells a four-night all-inclusive accommodation service to an agency for 2,000 Turkish liras excluding VAT, and to a customer for 2,400 Turkish liras excluding accommodation tax.
A hotel operator sold five nights of a room to an agency for 10,000 Turkish liras excluding VAT on 15/2/2023, and the agency also paid the person (T) for the same period.
The accommodation tax is calculated for one-month periods of the calendar year in which the activity is carried out.
It has been found appropriate to submit all accommodation tax declarations in electronic form, and those who do not have income or corporate tax liability can submit themselves electronically.
Taxpayers who received a user code, password and password to submit a declaration electronically before the effective date of this Communiqué may use their current user code, password and password.
Taxpayers can send their Accommodation Tax Returns through real or legal persons who have been given intermediation authority, after applying to the authorized tax office.
Taxpayers must submit the Accommodation Tax Declaration electronically, by means of real or legal persons who have been authorized to send electronic declarations.
Taxpayers with VAT liability declare their total tax for all accommodation facilities with a single declaration, while those who are not liable for VAT declare their total tax for all accommodation facilities with a single declaration.
The form, content and annexes of the Accommodation Tax Declaration are determined by the Revenue Administration.
Accommodation tax is levied by the tax office to which the taxpayer is affiliated in terms of VAT, and by the tax office where the declaration is submitted for those who do not have VAT liability.
Accommodation tax is levied on behalf of real or legal persons, and any of the partners is subject to assessment.
In case the accommodation tax is calculated incorrectly or excessively, the transaction must be returned to the previous state before the tax was applied.
Within the framework of the procedures and principles stipulated in the Tax Procedure Law, a refund can be requested in cash.