Extensive renovations other than minor repairs made in rented workplaces are tracked in the 264 SPECIAL COSTS account and are amortized in 5 years. If the lease period ends before 5 years or the workplace is moved, the remaining amount is directly recorded as expense or cost in the month of the move.
The entire VAT in the invoices related to comprehensive renovations made in rented workplaces is deducted in the VAT declaration in the month of the invoice.
SAMPLE ACCOUNTING RECORD
The company titled ABC DENİZCİLİK A.Ş. has made comprehensive renovations in the company building where it operates and an invoice of 1,000,000 TL VAT excluded was issued from ÇDE İNŞAAT LTD.ŞTİ. for the renovation.
____________________ / ____________________
264 SPECIAL COSTS 1,000,000 TL
191 VAT TO BE DEDUCTED 200,000 TL
329 OTHER TRADE DEBTS 1,200,000 TL
____________________ / ____________________
Source: Istanbul Chamber of Certified Public Accountants
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