How to Claim VAT Refunds for Trade Fair Expenses in Turkey: A Guide for Foreign Businesses and Attendees

I. Introduction to VAT Refunds for Trade Fair Expenses in Turkey

For foreign businesses attending trade fairs, trade shows, and exhibitions in Turkey, a unique opportunity exists to claim a refund on the Value Added Tax (VAT) paid for goods and services directly related to their participation. This provision, designed to encourage international presence in Turkish trade events, helps reduce overall costs for non-resident companies by allowing them to claim VAT refunds for trade fair expenses related to their attendence to trade fairs and shows in Turkey.

Turkey’s VAT system generally applies to nearly all goods and services purchased within the country, including those procured by foreign trade fair attendees. However, according to Turkish tax law, foreign companies attending these events can seek a VAT refund on eligible purchases related to trade fair participation, provided they meet certain criteria. This can include costs such as booth rentals, electricity and water charges, general services for exhibition spaces, and even accommodations needed for the fair. By refunding these costs, Turkey offers foreign businesses a way to mitigate some of the financial impact of VAT, enhancing the appeal of attending Turkish trade fairs.

It’s essential to understand that the VAT refund is a post-purchase recovery mechanism. Foreign businesses must still pay VAT on eligible items and services upfront, as Turkey does not offer an exemption from VAT at the point of sale. The refund claim must be submitted later, allowing eligible foreign businesses to recoup some of the costs they incur for participating in trade fairs. This system enables foreign companies to actively support Turkish industry while benefiting from a partial cost recovery on their local expenditures.

II. Legal Basis 

The legal framework for VAT refunds to foreign trade fair attendees in Turkey is grounded in Article 11 of the Turkish VAT Law and further detailed in the General Application Communiqué on VAT. These provisions outline the requirements and conditions under which non-resident businesses may claim VAT refunds on eligible purchases related to their participation in trade fairs, exhibitions, and similar events held in Turkey.

According to Article 11, foreign businesses with no residence, business, or legal center in Turkey are eligible to claim VAT refunds on certain trade fair expenses. This applies strictly to goods and services directly connected to the trade fair activity, such as booth rentals, utility costs, and other fair-related expenses that are necessary for participation. It’s important to emphasize that the law does not exempt these foreign attendees from paying VAT initially; rather, it allows them to claim a refund after these purchases are made.

Another significant aspect of the legal framework is the reciprocity requirement. Turkey’s VAT Law specifies that only foreign individuals or companies from countries that offer a similar refund option to Turkish businesses can benefit from this provision. This requirement means that foreign attendees must verify that their home country provides a reciprocal VAT refund arrangement to Turkish trade fair participants.

III. Eligibility Criteria for Foreign Trade Fair Attendees

To qualify for a VAT refund on trade fair-related expenses in Turkey, foreign businesses must meet specific eligibility requirements outlined in Turkey’s VAT legislation. These criteria ensure that only non-resident businesses attending Turkish trade fairs, exhibitions, and similar events for commercial purposes can claim VAT refunds.

a. Non-Resident Status Requirement

The VAT refund is available only to businesses that do not have a permanent presence in Turkey. This means that the applicant must have no legal, business, or tax-related obligations in Turkey. Foreign companies must also ensure they do not engage in activities within Turkey that would require registration for VAT, income, or corporate taxes, as this would disqualify them from the refund.

b. Trade Show-Related Purchases Only

The VAT refund applies solely to goods and services directly related to trade show / fair attendance. Eligible purchases include booth or exhibition space rentals, utility expenses like electricity and water for the exhibition site, general services provided for the fair, and accommodations used during the event. It’s important to note that VAT refunds will only be granted for purchases that are exclusively connected to the business’s participation in the trade fair.

c. Countries with Reciprocity for VAT Refunds

To qualify for a VAT refund in Turkey, the applicant’s home country must have a reciprocal arrangement, meaning it also offers similar VAT refund rights to Turkish businesses. Currently, VAT refunds in Turkey are available for attendees from the following countries:

Foreign businesses from these countries can claim VAT refunds on eligible trade fair expenses as long as they meet the other specified criteria. It’s important to note that the list of eligible countries is regularly updated and subject to change based on decisions by the Ministry

IV. Application Process for Trade Fair Expenses 

The VAT refund process for foreign businesses attending trade fairs in Turkey involves specific steps and required documentation. Following these procedures carefully can help foreign companies reclaim the VAT paid on eligible trade fair expenses efficiently.

a. Steps to Apply for a VAT Refund for Trade Fair Expenses in Turkey

To apply for a VAT refund, foreign companies must submit a formal application to the Turkish tax authorities with the necessary documentation. Here is an outline of the key steps:

1. Complete the VAT Refund Application Form
   The application form, specified in the General Application Communiqué on VAT, must be completed in full. It requires details about the applicant’s business and the expenses incurred in Turkey related to trade fair participation.
2. Provide a Tax Registration Certificate from the Home Country
   Applicants must supply a tax certificate from the relevant tax authority in their home country. This certificate should confirm that the business is registered for tax purposes in its home country, meeting the reciprocity requirement outlined in Turkish VAT law.
3. Submit Invoices and Documentation for Eligible Expenses
   All expenses must be documented with original invoices or notarized copies that meet Turkish tax standards. These invoices must clearly reflect the purpose of the expenses, such as booth rental or utility costs related to the trade fair, and should show that VAT was paid on each purchase.
4. Identify the Appropriate Tax Office for Submission
   VAT refund claims should be submitted to the tax office responsible for the location where the trade fair or event was held. Applicants can confirm the appropriate tax office with local authorities to ensure their refund request is processed correctly.

b. Submission Timeline and Payment Methods

Foreign businesses participating in trade fairs in Turkey can claim a VAT refund on eligible expenses within a specific timeframe. The Turkish VAT law allows these businesses to submit a refund claim for VAT paid on trade fair-related purchases up until the end of the second calendar year following the year in which the VAT was originally paid. This extended timeline enables businesses to plan and submit claims for VAT refunds at a convenient time while ensuring that claims remain valid for a reasonable period after the expenses were incurred.

For example:

• If VAT was paid in 2022, the attendee has until December 31, 2024, to submit a refund claim for those expenses.
• Similarly, for VAT paid in 2023, the deadline for submitting the refund claim would be December 31, 2025.

This rule applies regardless of when within the year the VAT was paid, giving foreign attendees a substantial period to gather necessary documents, complete the application, and file the claim.

V. Required Documentation 

To claim a VAT refund on trade fair-related expenses in Turkey, foreign businesses must submit the following documents:

1. VAT Refund Application Form: Completed form as specified in the VAT General Communiqué.
2. Tax Registration Certificate: Proof of tax registration from the applicant’s home country, confirming reciprocity.
3. Original Invoices or Notarized Copies: Documentation of eligible expenses such as booth rentals, utilities, and accommodations, showing VAT paid.
4. Certified Passport Copy (for individuals): For individual attendees, a notarized copy of the passport is required.
5. Additional Transport Documents (if relevant): Documentation for transport-related expenses, such as TIR carnet and transit records. 

VI. Conclusion

For foreign businesses participating in trade fairs, shows, and exhibitions in Turkey, the VAT refund process offers a valuable way to recoup expenses related to their attendance. Turkey’s VAT refund system allows eligible foreign companies to recover VAT paid on necessary expenses like booth rentals, utilities, accommodations, and other services directly linked to their participation. However, while this process can provide significant cost savings, it also requires careful attention to eligibility criteria, documentation standards, and submission deadlines.

Understanding the legal framework, especially the reciprocity requirement, is essential, as only attendees from certain countries are eligible. Furthermore, businesses must comply with the Turkish tax authority’s strict guidelines on documentation and timing to avoid delays or rejections. Each step of the process—from gathering correct invoices and tax registration certificates to ensuring the claim is submitted within the specified timeframe—plays a crucial role in successfully reclaiming VAT.

Given the complexity of the refund application, many foreign businesses find that working with a VAT refund specialist can streamline the process, ensuring compliance with Turkish regulations while saving time and maximizing the refund amount. Engaging professional assistance helps minimize the risk of errors and allows businesses to focus on their primary goal: establishing a successful presence in Turkish trade fairs.

By taking advantage of VAT refunds, foreign businesses can make their trade fair attendance in Turkey more financially sustainable, enabling them to participate more competitively and effectively in one of the region’s key marketplaces. For support with your VAT refund claims or additional guidance, please contact us directly.

Av. Ali Yurtsever

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