For rules to carry any real weight, the rule-maker must combine compliance with that rule with either a carrot or a stick. In the field of tax legislation, the rule-maker, in this case, the legislator or the tax authority, almost always goes down the route of the stick in situations of noncompliance. And the penalties are generally significant enough to make the subjects act by the rules. This fundamental concept also applies within the Turkish electronic documents framework and there are sanctions prescribed to penalize noncompliance of taxpayers.
The penalties fall under two categories: penalties for e-invoice, e- arşiv invoice and export invoices, and penalties for e-delivery notes.
Penalties for noncompliance with e-invoice, e-arşiv invoice and export invoices
According to article V.6 of the General Communique on the Tax Procedural Law No. 509 (Communique), the following scenarios of noncompliance will result in a fine that is 10% of the actual amount or of the missing amount of an e-invoice (e-invoice, e-arşiv invoice and export invoices). The fine can’t be lower than TRY 350 (approx. EUR 50) per invoice and the maximum fines might reach TRY 180,000 (approx. EUR 25,700) annually per document type. This would apply as follows:
- Issuing a paper invoice instead of an electronic one in the cases where electronic issuance is mandatory
- Accepting a paper invoice that was supposed to be issued electronically
- Misstating the price on the invoice or accepting an invoice which includes the wrong price
- Not issuing e-invoices according to the rules and in the cases where e-invoices are deemed as not issued.
Penalizes apply to not only the issuer but also the receiver of invoices. So, the receivers of these invoices should be cautious about their e-invoicing process.
Penalties for e-delivery notes in the case of noncompliance
Noncompliance with the rules relating to e-delivery notes will result in a TRY 350 (approx. EUR 50) fine per document. The maximum fines might reach TRY 180,000 (approx. EUR 25,700) annually but can’t exceed this amount. These capped fines are also updated every year incrementally.
There are six cases considered as noncompliance:
- Not issuing the e-delivery note
- Not using an e-delivery note
- Not keeping the e-delivery note present during transportation
- Not issuing the delivery note electronically
- In the cases where the copy of the e-delivery note does not reflect the same information or issuing an e-delivery note that does not reflect the transaction
- In the cases where e-delivery notes are deemed as not issued.
To operate and develop their businesses in Turkey, a jurisdiction with a complex structure and a heavily regulated e-documents framework, taxpayers must make sure they have compliant e-document processes in place. Otherwise, the penalties and fines imposed for noncompliance can be significant.
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