- VAT in Turkey’s jewellery sector is applied only to the portion of the sale price exceeding the exempt bullion value of gold or silver.
- Article 17/4-g of VAT Law No. 3065 defines the exemption for gold and silver bullion.
- Jewellers must calculate the bullion value based on purity and deduct it before applying the 20 percent VAT rate.
- Improper estimations can lead to penalties during tax audits.
- VAT rates updated to 1 percent, 10 percent, and 20 percent as of July 7, 2023, with jewellery generally at 20 percent unless exempt.
- Jewellers must determine the bullion value using a purity calculation called millyem.
- The bullion value is calculated by multiplying millyem by the market price of 1 gram of gold and the total grams of gold in the item.
- The remaining amount after deducting the bullion value is the taxable base for VAT.
- Many businesses incorrectly estimate VAT, risking tax issues during audits.
Source: fiscal-requirements.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
