Rental income return: residential, commercial and the exemption
The TRY 58,000 exemption for residential rent, credit for withholding on commercial rent, the lump-sum and actual expense methods; who files a return in March?
Rental income is income from immovable property for income tax purposes; amounts earned in a calendar year are declared in the annual return in March of the following year. Tax is paid in two equal instalments in March and July. Rental income tax calculator
Residential rent
- TRY 58,000 of residential rental income earned in 2026 is exempt.
- No return is filed for residential rent below the exemption.
- Those filing for business, agricultural or professional income and those whose total rent exceeds a set amount cannot use the exemption.
- There is no withholding on residential rent; the landlord declares it.
Commercial rent
- No exemption.
- If the tenant is a business, 20% withholding was deducted when rent was paid. Rent withholding calculator
- If total gross commercial rent subject to withholding does not exceed the 2026 filing threshold in Income Tax Law art. 86, a return may not be needed; if it does, it is declared and withholding is credited.
Expense method
| Method | What is deducted? | Note |
|---|---|---|
| Lump-sum | 15% of gross rent | No documents needed; cannot be changed for 2 years once chosen |
| Actual expenses | Maintenance and repair, insurance, property tax, depreciation, loan interest (under conditions) | Documents needed |
Example
Commercial rent in 2026 gross TRY 360,000 (withholding TRY 72,000), lump-sum method:
| Amount | |
|---|---|
| Gross rent | TRY 360,000 |
| Lump-sum expense 15% | − TRY 54,000 |
| Tax base | TRY 306,000 |
| Tax (non-wage brackets) | 28,500 + 116,000 × 20% = TRY 51,700 |
| Withholding credited | − TRY 72,000 |
| Result | TRY 20,300 refund / offset |
If withholding exceeds the tax calculated, the difference is refunded. Income tax bracket calculator
Watch out
- Jointly owned property: each owner declares their share; the exemption applies to each separately.
- Rent must be collected via a bank: collection through a bank or post office is mandatory for residential and commercial rent; otherwise a special irregularity penalty may apply.
- Pre-filled return system: the Revenue Administration pre-fills rent information; still check the amounts.