Turkey’s Digital Transformation and E-Invoicing Landscape

Selin Adler Ring
March 24, 2020

For companies operating in Turkey, 2019 was an eventful year for tax regulatory change and in particular, e-invoicing reform. Since it was first introduced in 2012, the e-invoicing mandate has grown, and companies are having to adapt in order to comply with requirements in 2020 and beyond. 

According to the General Communique on the Tax Procedure Law (General Communique), more taxpayers now need to comply with the mandatory e-invoicing framework. The General Communique published on 19 October 2019 covers other e-documents such as e-arşiv, e-delivery note, e-self-employment receipts, e-producer receipts, e-tickets, e-note of expenses, e-Insurance Commission Expense Documents, e-Insurance Policies, eDocument of Currency Exchange, and e-Bank Receipts.

The scope of e-invoicing

From 1 July 2020, taxpayers with a gross sales revenue of TL 5 million or above in fiscal years 2018 or 2019 must switch to the e-invoice system. Taxpayers who meet these requirements in 2020 or later, should switch to the e-invoice system at the beginning of the seventh month of the following accounting year.

Mandatory e-invoicing is not only based on the threshold

Turkey’s tax authority has set some sector-based parameters for businesses operating in Turkey. Companies licensed by the Turkish Energy Market Regulatory Authority, middlemen or fruits or vegetable traders, online service providers facilitating online trade, importers and dealers are some of the taxpayers also required to switch to e-invoices, irrespective of their turnover.

The scope of e-arşiv invoice

E-arsiv fatura is used to document B2C transactions, but also in case the transacting counterparty is not registered with the TRA for e-invoicing. Similar to e-invoice, the e-arşiv invoice, became mandatory for intermediary service providers, online advertisers, and intermediary online advertisers who switched to the system from 1 January 2020.

From now on, taxpayers not in scope for e-invoice and e-arşiv are still obliged to issue e-arşiv invoices through the Turkish Revenue Administration´s portal if the total amount of an invoice issued to the same person or institution on the same day, including taxes, exceeds TL 5.000 for B2B and TL 30.000 for B2C transactions.

Turkey is continuing to tackle its VAT gap by taking greater control of reporting and requiring more granular tax detail.  So, businesses operating in Turkey need powerful e-invoicing strategies to comply with the growing demands for digital tax transformation.

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Author

Selin Adler Ring

Selin is Regulatory Counsel at Sovos. Based in Stockholm and originally from Turkey, Selin’s background is in corporate and commercial law, and currently specializes in global e-invoicing compliance. Selin earned a Law degree in her home country and has a master’s degree in Law and Economics. She speaks Russian, Arabic, English and Turkish.
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