Turkey Introduces Beneficial Ownership Disclosure Rules
Preventing Tax Evasion and Ensuring Financial Transparency
The Turkish Revenue Administration has taken a significant step in promoting transparency by introducing beneficial ownership disclosure rules for corporate taxpayers and other entities. The move aims to prevent tax evasion, enhance financial integrity, and strengthen the country’s regulatory framework.
Key Provisions of the Communiqué
- Scope: All corporate taxpayers must submit their ultimate beneficial ownership information with provisional tax returns and annual corporate tax returns.
- Definition of Ultimate Beneficial Owner: A real person who has control or influence over a legal or non-legal entity, including companies, partnerships, trusts, and similar entities.
Disclosure Requirements
When submitting the declaration, the following information must be provided:
- Name and surname
- Citizenship
- Identity number
- Address
- Telephone
- Fax
Submission Methods
The declaration can only be submitted online through the Internet Tax Office. Physical forms will not be accepted.
Consequences of Non-Compliance
Those who fail to declare their ultimate beneficial ownership status or submit incomplete or incorrect information may face sanctions under the Tax Procedure Law, including a special irregularity penalty ranging from TRY 650 to TRY 2,500 for 2021.
Best Practices
To ensure compliance with the new regulations:
- Fulfill obligations within specified periods and dates
- Maintain up-to-date declarations in case of any changes
- Be prepared for potential communications with other public institutions and organizations
The Turkish Revenue Administration aims to promote transparency and prevent tax evasion through these new rules. Obliged parties are advised to take the necessary steps to comply with the regulations.