Just as gold or money in a safe in your home can be inherited if you know where it is and have the safe key to retrieve it, so can bitcoin in your personal crypto wallet. If your crypto money is on the stock exchange, then the situation can be considered like money in the bank.
The subject of today’s news is the opinion prepared by the Edirne Tax Office and approved by the Revenue Administration. According to the opinion, when defining Bitcoin, it started as a security, but eventually continued as money and promissory notes. In fact, this report is a bit contradictory, but the important thing is that the issue has started to take place in our legal system. This points to the recognition of Bitcoin and other blockchain protocols in the future. In the Finance Opinion, the imputed values to be taken as a basis for taxation are not specified in the stock exchange values, but the imputed value or the value registered in the stock exchange should be included in the inheritance transfer declaration.
In fact, our Ministry of Finance has also announced that naming cryptocurrencies is important in terms of taxation. I have made studies and presentations in this direction at the Tax Council of Turkey. The most important issue is to define what cryptocurrency is. The CMB and the Central Bank are also discussing the concepts of commodity, securities and money. It would not be correct to consider it as money because the current volatility, its use for investment purposes rather than transactions and the deflationary structure do not allow it to be money. For example, the US and Australia have chosen to tax them as commodities, while the UK has been operating foreign currency taxation rules. I can say that the views that commodity definition would be appropriate in our country also predominate.
The issue should not only be considered in terms of inheritance. In debt lawsuits, divorces and other lawsuits, it is frequently requested to put an injunction on bitcoin and similar cryptocurrency assets. If the assets are in crypto wallets, this measure cannot be applied, but if they are in exchanges, it can be applied.
There is an important point here; the taxation of cryptocurrencies should be handled very carefully. Because it is currently difficult to track these coins. If taxation in Turkey is hasty and erroneous, foreign exchanges may be preferred over cryptocurrency exchanges established in Turkey. This may cause billions of liras of liquidity to go abroad and become completely uncontrolled in foreign exchanges. As a result, measures should be taken to prevent the savings of Turkish investors from shifting to international exchanges. Tax legislation or implementations should definitely be strategically considered.
Below is the opinion of Edirne Tax Office stated in the letter above.
Av.Kadir Kurtuluş, LL.B,MBA
Sayı : 60938891-120.01.02.09[GVK: 3-1]-33826
Tarih : 23/09/2020
T.C.
GELİR İDARESİ BAŞKANLIĞI
Edirne Vergi Dairesi Başkanlığı
Gelir Kanunları Grup Müdürlüğü
| Sayı | : | 60938891-120.01.02.09[GVK: 3-1]-E.33826 | 23.09.2020 | |
| Konu | : | Mirasçılara Bitcoin Varlığı Karşılığında Ödenecek Tutarın Veraset ve İntikal Vergisi Yönünden Değerlendirilmesi Hk. | ||
From the examination of your registered special request form and its annexes, it is stated that your spouse … passed away on 31/5/2019, that the murisin was a user of … A.Ş., which deals with the purchase, sale and transfer of Bitcoin over the internet, and that there are 0.02 TL and 0. 40420899 Bitcoin, the total value of the said Bitcoin asset in the account of the murisin as of the date of death is 20.540,30 TL, and it is understood that you have requested that the payment of the value of the said asset to the heirs be evaluated in terms of inheritance and inheritance tax.
In Article 1 of the Inheritance and Gift Tax Law No. 7338, the goods belonging to the persons who have the nationality of the Republic of Turkey and the goods located in Turkey are subject to inheritance and gift tax through inheritance or by any means, regardless of the transfer from one person to another person in a gratuitous manner; In Article 2, subparagraph (b) of the first paragraph of the first paragraph, it is stipulated that the term “property” refers to movable and immovable things that can be subject to ownership and all other rights and receivables that can be included in the property; In Article 5, it is stipulated that the taxpayer of the inheritance and gift tax is the person who acquires property through inheritance or without consideration.
Article 17 of the same Law reads as follows: “Public administrations and institutions, banks, bankers, safe deposit box lessors, insurance companies, other companies and institutions, courts and execution offices, in order to give money and bills to the beneficiaries due to any transaction falling within the scope of this tax, they first request a certificate from the tax office that the tax has been paid.
The beneficiaries who do not submit a certificate may give the balance after withholding five percent for inheritance transfers and fifteen percent for gratuitous transfers. Those who make the withholding are obliged to deposit the withheld money in the property chest of the place where they are located within one week at the latest and to notify the tax office to which they are affiliated in writing.
Those who give money and promissory notes without withholding and those who do not deposit the withheld money to the property chest within the above-mentioned period (except judges), the money they are obliged to withhold and deposit shall be collected by applying a delay increase according to the provisions of the Law on the Procedure for Collection of Public Receivables. A penalty at the rate of 10% of the money they are obliged to withhold and deposit is also collected from those responsible for the relevant institutions that do not fulfill these duties in due time.”
Accordingly, in the transfer of the money and bonds in the institutions and organizations listed in the 17th article to the heirs, first of all, a confirmation that the tax has been paid should be requested, and payment should be made after withholding five percent from the rations of the heirs who do not submit a confirmation, and the withheld money should be deposited in the property chest within one week at the latest and the situation should be notified to the tax office.
Within the framework of the explanations made above, the total value of the Bitcoin asset in the account of …A.Ş. belonging to the muris … A.Ş. must be declared by the heirs with the declaration of inheritance and inheritance tax and if the tax to be accrued is paid, the attachment certificate must be given, and in case the heirs do not submit a declaration, it is possible to pay the remaining amount to the heirs after withholding at the rate of (five percent) 5% by … A.Ş. as an offset against the tax to be paid later. In addition, it is natural that the withheld money should be deposited to the nearest tax office within one week at the latest and the situation should be notified to the tax office authorized to levy.
I kindly request information.
(*) This Special Notice is given based on Article 413 of the Tax Procedure Law No. 213.
(**) If incorrect information has been given regarding this issue even though it is in examination, judgment or settlement, this specialization is invalid.
(***) If you act in accordance with this specialization assigned upon your request, if it is necessary to levy tax due to these acts, no tax penalty will be imposed on you and no default interest will be calculated for the levied tax.
Source: https://www.gib.gov.tr/mirascilara-bitcoin-varligi-karsiliginda-odenecek-tutarin-veraset-ve-intikal-vergisi-yonunden