We are with you with the new section of our blog posts where we share sectoral developments and current legislation in the financial world. In this article, we share with you the important innovations brought to the business world in tax law and tax practices by the Tax Law No. 7524, which was published in the official gazette on August 2, 2024.
This new tax law amendment, which includes important new provisions for both organizations and taxpayers, aims to fulfill tax obligations more fairly and efficiently. So what innovations do these new regulations bring to the business world and online payment systems?
What does the 2024 Tax Reform and the Regulations Introduced by Tax Law No. 7524 Target?
The Tax Law No. 7524, which introduces important new regulations aiming to create a fair and effective tax system in areas such as corporate tax, digital services tax and international corporate tax, includes important measures that will shape the future of the Turkish economy.
The new regulations aim to prevent international tax evasion, tax the digital economy fairly, tax e-commerce regularly and under control, and combat informality by increasing tax compliance as a result.
While the new tax regulations bring many innovations from corporate taxes to digital services, these regulations also aim to promote economic growth through changes in tax law.
What Will Be the Impact of the Amendments to the Tax Procedure Law on Businesses?
With the new law numbered 7524, penal sanctions against practices that lead to tax loss are increased in the Tax Procedure Law (TPL). With the new regulation, which imposes serious penalties especially on collections made through POS devices and accounts belonging to others, a period in which payments made by businesses through POS and bank accounts will be monitored with great care is being passed.
With this regulation, special irregularity penalties will also be applied for payments received through devices or accounts that are not registered in the name of the business. These greatly increased penalties aim to prevent tax loss and reduce unregistered trade.
How will the Regulation Impact on the Dealership Network and Virtual POS Usage?
Amendments made within the framework of Tax Procedure Law No. 7524 bring more detailed rules in the use of both physical POS and Virtual POS. Both systems are subject to the same penal regulations without any difference in physical and virtual POS systems. With the regulation, it will be of great importance for businesses to act in accordance with these regulations and review their existing systems.
Especially for companies working with a dealer network, using virtual or physical POS systems effectively and digitalizing their collection processes will provide companies with both a cost advantage and a secure payment environment.
For our virtual POS product and virtual POS application processes, see our What is Virtual POS? How to get it? You can take a look at our content.
Are Dealer POS Systems Compliant with the New Legislation?
With the publication of the regulation, one of the questions raised is whether dealer POS systems are compliant with the legislation. According to the statement made by the Revenue Administration (RA) on August 6, 2024, the use of POS devices in relations between dealers and sub-dealers may be permitted based on the contract between them. However, it is underlined that this use must comply with banking legislation.
The following announcement of the Revenue Administration clearly defines this penalty article of the Law No. 7524 and its justification, which results in severe penalties for the use of POS devices belonging to others
“Pursuant to the banking legislation, taxpayers may use the physical POS device and/or virtual POS allocated to them by the banks to their sub-businesses in accordance with the regulations in the relevant legislation in accordance with the contract between them within the scope of dealer-sub-dealer relationship and similar relationships.”
Accordingly, within the scope of dealer-sub-dealer relationship and similar relationships, taxpayers who both use the POS device allocated to them and make collections related to the goods and services they deliver through these devices can act as stipulated in the said legislation, provided that they fulfill their obligations to issue documents, record revenues and other obligations in full and on time in accordance with the provisions of Law No. 213.
In light of all this information, we can clearly state that the amendments to the Tax Procedure Law No. 7524 will significantly affect the tax processes and collection systems of businesses. It is understood that the main purpose of Article 13 of Law No. 7524 is to prevent taxpayers who are not in a dealership relationship from conducting unregistered transactions through payment systems belonging to other taxpayers. When the text of Article 13 of the Tax Procedure Law No. 7524 is analyzed, it cannot be concluded that taxpayers operating in a dealership or sub-dealership relationship can use physical or virtual POS systems registered in the name of the parent company. However, it should be noted that the explanation in the RA announcement does not provide any legal protection.
We can also underline that one of the most important points of these regulations introduced by the new law is the clarification of the conditions under which physical or virtual POS applications will be allowed in companies working with dealer-sub-dealer relationships proven by contract, in parallel with previous administrative opinions, without making major changes to existing systems and without creating additional costs.
August 6, 2024, you can access the full RA announcement from the link below:
https://www.gib.gov.tr/kredi-karti-ve-banka-karti-ile-yapilan-odemelere-iliskin-aciklama
