STATUTE OF LIMITATIONS IN TURKISH TAX LAW 1 December 2022

STATUTE OF LIMITATIONS IN TAX LAW

A statute of limitations in tax law; means the elimination of the tax claim by the expiration of the period determined by the relevant legislation. In tax law, there are two types of the statute of limitations: statute of limitations for levy and statute of limitations for collection. The statute of limitations for the levy is determined by the Tax Procedure Law No. 213; The statute of limitations for collection is regulated by Law No. 6183 on the Collection Procedure of Public Receivables.

I. The Statute of Limitations for Levy

What is the statute of limitations for the levy?

Statute of limitations for levy; the statute of limitations; is a type of statute of limitations to be applied on public receivables (taxes, duties, and fees levied by the general budget, special provincial administrations, and some local governments consisting of municipalities and their accessories) within the scope of the Tax Procedure Law No. 213.

What is the time limit for the statute of limitations? Is it necessary for the taxpayer to apply for the statute of limitations to take effect?

Pursuant to article 113 of the Tax Procedure Law, the tax receivable is removed with the expiration of the statute of limitations and the statute of limitations becomes effective even if the taxpayer does not apply in this regard. The statute of limitations is regulated under Article 114 of the Tax Procedure Law. Pursuant to Article 114 of the Tax Procedure Law, the tax becomes time-barred if it is not levied and notified within five years, starting from the beginning of the year following the calendar year in which the tax claim arises.

What are the conditions for the statute of limitations of tax?

When the wording of the Tax Procedure Law is examined, as a prerequisite for the statute of limitations:

• Realization of the taxable event,
• The assessment process has not been made within the period stipulated in the Tax Procedure Law,
• The notification must not have been made within the time stipulated by the Tax Procedure Law.

Even if the assessment process is done on time; If the documents/writings that are related to taxation and creating results are not notified to the taxpayer, tax officer, or other relevant persons in accordance with the time and procedure stipulated in the Tax Procedure Law, the notification will be invalid and will not have any legal consequences for the concerned. In addition; As conveyed within the scope of Article 108 of the Tax Procedure Law, if the mistakes made in the notified documents are "substantively effective", the notification becomes null and void and does not create a judgment for the relevant parties.

What are the reasons for stopping the statute of limitations?

In the Tax Procedure Law, two situations are regulated that suspends the statute of limitations period. Accordingly, the reasons for stopping the statute of limitations;

• Applying to the Appraisal Committee for the assessment of the base,
• Due to force majeure, the deadlines do not run. (Article 15 of the Tax Procedure Law)

What are the reasons for cutting the statute of limitations?

After the assessment and notification of the tax receivable, it will be possible to talk about the collection timeout, not the imposition time limit, since the tax will be collected. Accordingly, there is no regulation in the Tax Procedure Law regarding the termination of the accrual statute of limitations.

II. The Statute of Limitations for Collection

What is the statute of limitations for collection?

It is the type of statute of limitations for public receivables that are not collected despite the expiry of the period determined by the Law on Collection Procedure of Public Receivables No. 6183.

What are the terms of the statute of limitations for collection?

Collection timeout is regulated by Article 102 of the Law on Collection Procedure of Public Claims. Collection timeout is related to public receivables. Conditions of the collection statute of limitations:

• The maturity of the public receivables,
• It can be listed as the fact that the collection process has not been carried out within the period stipulated in the Law on Collection Procedure of Public Receivables.

The period of limitation for collection starts from the beginning of the calendar year following the calendar year in which the public receivable becomes due.

What are the reasons that stop the statute of limitations for collection?

Collection timeout is handled within the scope of Article 104 of the Law on Collection Procedure of Public Claims.

• The debtor's presence in a foreign country, fraudulent bankruptcy or liquidation of his estate, and
• These reasons written in the law should not allow proceedings against the debtor.

Collection timeout continues from where it left off as of the day on which the reasons for non-operation are lifted.

What are the reasons that cut the statute of limitations for collection?

The reasons for cutting the collection timeout are regulated in Article 103 of the Law on Collection Procedure of Public Claims. Accordingly, the reasons for cutting the statute of limitations are:

• Partial payment,
• Foreclosure exercise,
• All kinds of collections made as a result of compulsory collection and follow-up transactions,
• Notification of payment order,
• Declaration of goods, acquisition of goods, and notification of an increase in goods,
• Some transactions applied to or carried out by the guarantor or the representatives of foreign persons and institutions,
• The decision of annulment by accident authorities in disputed receivables,
• Securing the public receivables,
• Deciding on the postponement of execution by the accident authorities,
• For an existing debt between two public administrations, a written application is made by the creditor public administration to the debtor public administration for the payment of the debt, and
• It is the application of the public receivables to be paid in accordance with special laws and/or the connection to the payment plan.

III. CONCLUSION

It may be possible to interrupt the statute of limitations, especially with the actions to be taken by the administration alone. Since this situation will lead to a loss of rights for taxpayers, the unilateral actions of the administration are of great importance to the taxpayer. For this reason, it is thought that in order to avoid the loss of rights of the taxpayer, getting help from experts in the field both in administrative proceedings and in the judicial process will prevent possible loss of rights.