Amendment to the General Communiqué on Value Added Tax Implementation

Amendments have been made by adding a section titled 'VAT Application in the Sale of Cards, Passwords, Codes, and Similar Items' following the section (I/B-15.) of the Value Added Tax General Implementation Communiqué, which was published in the Official Gazette numbered 28983 on the date of April 26, 2014.

Cards, passwords, and codes (such as activation codes, e-pin codes, game codes, digital product codes, wallet codes, gift cards/vouchers, and similar items) can be used to acquire computer programs, games, applications, music, publications, and entertainment products and services marketed in virtual environments (such as broadcasting platforms, gaming sites, application stores). These cards, passwords, and codes can be used for secure shopping in both virtual and physical stores and can be sold either in a virtual environment or physically.

The aforementioned cards, passwords, and codes can either represent the value of a specific product or service, or they can represent a virtual purchasing power for buying products or services from the issuers.

Some cards, passwords, and codes represent a specific product or service and cannot be used to obtain another product or service, even if they have not yet been activated. The importation of these cards, passwords, and codes from abroad or their sale in Turkey is subject to VAT.

With the regulation made:

• If these are obtained by residents of Turkey from companies resident abroad, the related VAT must be declared and paid by the residents of Turkey through the 2nd VAT Declaration Form as a liable party.
• If these are obtained by individuals who are residents of Turkey but not VAT taxpayers, from electronic service providers resident abroad, the related VAT must be declared and paid by the foreign resident company through the 3rd VAT Declaration Form.
• The VAT calculated on sales in Turkey must be declared by the selling companies through the 1st VAT Declaration Form.

This relevant Communiqué comes into effect at the beginning of the month following its publication.

You can access the Official Gazette on the subject here. (In Turkish)

Should you have any queries or need further details, please contact your customer representative.