Individuals who earned rental income above 33,000 TL in 2024 are required to submit an income tax return starting from March 1st. The 2025 rental income tax guide provides answers to all inquiries.

The most anticipated among the incomes earned in 2024 is the method for declaring rental income. Individuals who earned rental income from March 1st to the end of April need to submit their declaration either online or directly at tax offices. Declarations will be made for rental incomes earned in 2024.

Those who fail to declare within the specified period will not benefit from the 33,000 TL deduction from the total annual rental income and may face additional penalties.

All questions regarding the rental income declaration are answered in the guide. Let’s take a closer look at the declaration of income derived from residential rental:

FOR WHICH PROPERTIES SHOULD DECLARATIONS BE SUBMITTED?

Those who receive income from land, buildings (including rental fees received for furnished rentals) must submit a declaration. The taxation of rental income is based on the receipt principle. According to the receipt principle, rental income must be collected either in cash or kind for taxation.

IS TAX PAID FOR UNCOLLECTED RENT?

Tax is not paid for uncollected rent. Collection of rental fees in cash refers to payments made in Turkish or foreign currency. Cheque payments are also considered as cash receipts. Rental fees collected by taxpayers for the current year or previous years are considered as the revenue of the year they were actually collected.

HOW IS TAX PAID FOR PREPAID RENT?

Prepaid rental fees for future years, collected in advance, will be considered as income in the year to which they belong, not the year of payment. For example, if rental fees for 2022, 2023, and 2024 are collected in bulk in 2024, these incomes will be considered as the revenue of 2024. If prepaid rent is collected in 2024, it should be declared as income for that year.

HOW IS TAX CALCULATED FOR RENTALS IN FOREIGN CURRENCY?

In leasing transactions in foreign currency, the gross revenue in rental income will be determined based on the TC Central Bank’s exchange rate at the date of collection.

Owners who rent out properties are required to declare rental transactions and payments using documents issued by banks, Post and Telegraph Organization Joint Stock Company. Transactions related to short-term rental leases for weekly, daily, or similar periods fall under the scope of proof.

DO I HAVE TO PAY TAX IF I COLLECT RENT THROUGH EXECUTION?

Owners who rent out properties and those who rent them out through court or execution decisions or in kind are not subject to proof obligation.

HOW CAN I PROVE MY RENTAL INCOME?

Transactions involving rental income using methods such as depositing money through banks, money transfers, EFT, cheques, bank and credit cards result in the issuance of receipts or account statements, which will be considered as proof. Payments and collections made through banks’ online branches are also included in this scope.

WHAT IS THE PENALTY IF I DON’T DECLARE MY RENTAL INCOME?

Individuals who fail to comply with the proof obligation in rental receipts and payments will be subject to a special irregularity penalty of 10% of the amount for each transaction, provided that it is not less than the specified amount according to the Tax Procedure Law repeated 355th article for that year. For those who make payments in a manner contrary to banking and the specified methods, if the situation is voluntarily reported to the authorities within five business days after the payment, no special irregularity penalty will be imposed on behalf of the payer.

I ALLOWED SOMEONE TO USE MY PROPERTY RENT-FREE, DO I HAVE TO PAY TAX?

Yes, you do. If the rent is absent or low, the “bench rent” will be taken as a basis. Accordingly, if a property is left for use without charge or if the rental fee is lower than the benchmark rental fee, the benchmark rental fee principle will be applied. The benchmark rental fee for properties rented out is the rental fee determined by competent private authorities or courts, if any. For example, if a taxpayer has given a 5,200,000 TL apartment with real estate tax value vacant free of charge to a friend in 2024, then the taxpayer should calculate the annual rental income from the benchmark rental fee. Benchmark Rental Fee: 5,200,000 TL multiplied by 5%, which equals 260,000 TL. This amount will be considered as the income that the taxpayer must declare.

TO WHOM CAN I ALLOW TO USE MY PROPERTY RENT-FREE?

For certain properties, it is possible to indicate that no rental income is earned and no tax is paid. These include letting properties vacant to protect them, allocating buildings to ancestors (parents, grandparents), descendants (children, grandchildren), or siblings (However, if multiple properties are allocated to each of these individuals, only one property will not have the benchmark rental fee calculated. For example, if a property owner has allocated two properties to his child, the benchmark rental fee will be calculated for one property, and not for the other.) If relatives reside together with the property owner, no rental condition is required.

WHAT IS THE RENTAL INCOME TAX EXEMPTION?

The housing exemption applies only to income earned from immovable properties rented out as residences. Individuals who earned less than 33,000 TL in residential rental income in 2024 will not be required to submit an annual declaration for this income. If the rental income exceeds this amount, a declaration must be submitted, and taxes must be paid. The exemption will be calculated as follows; if a taxpayer earned 240,000 TL in residential rental income from properties rented out in 2024, they will need to declare the remaining income after deducting 33,000 TL. Those whose rental income exceeds 870,000 TL in 2024 will not benefit from the 33,000 TL deduction.

I DON’T HAVE ANY RENTAL INCOME, BUT A TAX WAS ISSUED. WHAT SHOULD I DO?

In this case, you need to file an objection. There are two methods for objection. If you have a user code and password, you can access the digital tax office directly with them, or if not, you can use an e-Government password. Next, select the Ready Declaration System – My Revenues and Deductions – Rental Payments Made to Me and Deductions section and choose the year 2024 to list and access the determinations made by the Finance Ministry. If there are errors in this information, meaning that the payment received is not rental income, you should go to the same menu and select My Transactions – I Want to Make a Statement – Entry and Viewing a Statement – Which Year do you want to make a statement for (select 2024) – A Statement on Rental Payments Made to Me – The Amount Sent to My Account is Not Rent Payment checkbox – Write the explanation in the allocated section – Press Save, and the system will automatically send it to the tax office. The second method is as follows: If this process is difficult, you can file a petition through the digital tax office – My Petitions – Create New Petition – General Purpose Petition by providing detailed explanations and applying through the system. If dealing with this is too complicated, you must go to tax offices and submit a declaration to them. These objections and declarations must be made between March 1 and April 2, 2025.