VAT exemption on exports and the refund process
Conditions of the VAT exemption on exports of goods, supplies for export, matching the customs declaration with the invoice, refund of VAT that cannot be deducted, and common mistakes.
Exports are one of the most important VAT exemptions in Türkiye. Goods sold abroad are invoiced without VAT, but the VAT paid on producing or buying those goods can be refunded. This way the exporter's competitiveness is not reduced by the tax burden.
Exemption for exports of goods
For a supply to count as an export, there are two basic conditions:
- The supply must be made to a customer abroad.
- The goods must leave Türkiye's customs territory and reach a foreign country.
The invoice is issued without calculating VAT; it shows the exemption code and the customs declaration details. Collecting the price in foreign currency is a matter for other legislation, not the VAT exemption; even so, exchange differences should be tracked separately: Foreign currency transactions and exchange differences
Supply for export
Manufacturers can supply their goods to an exporter for export without VAT. For this:
- The supply must be made by the manufacturer (supplies of trading goods are not covered).
- The goods must be exported within three months from the beginning of the month following the date of supply.
- VAT calculated but not collected is declared separately by the exporter and cancelled if the goods are exported in time.
If the goods are not exported in time, the uncollected tax is claimed from the exporter.
Export of services
Services provided to a customer abroad and used abroad are also exempt from VAT. For services such as software, design and consulting, see: Export of services
Refund process
VAT that cannot be deducted because of the export exemption can be refunded. Roughly, the process is:
| Step | What is done |
|---|---|
| 1 | The exemption and the refund amount are shown on the VAT return for the period of the export |
| 2 | A refund request and the standard refund request lists are sent through the Digital Tax Office |
| 3 | Customs declaration details, invoices and lists of VAT borne are uploaded to the system |
| 4 | Depending on the amount, the refund is obtained with a tax audit report, a sworn accountant (YMM) report or a guarantee; no report is required up to a certain amount |
| 5 | The refund is made in cash or by offset against tax debts |
The refund is limited to VAT that has actually been paid and is deductible. If there is an adverse finding about one of your suppliers, the refund may be delayed. General guide: VAT refunds
Common mistakes
- Invoice date not matching the customs declaration date. The actual export date is determined by the customs declaration; invoices and return periods must be consistent with it.
- Missing the three-month period for supplies for export. The export should be planned before the period ends; if there is a delay, options for extra time should be explored.
- Missing invoices in the lists of VAT borne. VAT not on the list is not refunded.
- HS code and tariff errors. The description and code of the goods on the customs declaration must match the invoice: HS code search
Our related service: VAT and VAT refunds
Legal basis: VAT Law No. 3065 arts. 11, 12 and 32; VAT General Implementation Communiqué sections II/A and IV.