However, such capital income is not considered as income from capital investment, should they are earned (gained) through business, agricultural or independent professional activities.
Regardless of their sources, the following earnings are deemed to be income from capital investment:
– Dividends from stocks of every kind including jouissance shares, founder’s shares and interests and other remunerations paid to the stockholders in the preparatory stage of the corporation and earning from the securities issued by investment funds and investment trusts,
– Earnings from participation shares including the shares of limited companies, cooperatives and joint ventures,
– Dividends paid to the chairmen and the members of the board of directors,
– For institutions with limited tax liability and that submit annual or special tax return according to the Corporate Income Tax Law, the portion that remains after deduction of the corporation tax from the corporation earnings calculated before the deduction of the reductions and exemptions,
– Interests of every kind from bonds, treasury bonds, and earning from the securities issued by the Housing Development Administration and the Public Participation Administration,
– Interest from debt-claims of every kind particularly interest from banks and other financial institutions,
– Deposit rates,
– Profits from selling coupons of stocks and bonds before their maturity,
– Income from selling of dividends not accrued yet to the owners of the shares,
– Amount of discount received in return for all bills discounted,
– Dividends paid to those who lend money without interest and dividends paid in return of profit-Ioss participation notes and profit- Ioss participation accounts,
– Income from repurchasing agreement on bonds and securities,
– The income payments made by the retirement funds in the nature of legal entity aid funds, retirement and insurance companies,
– Income from Individual Pension System,
– All types of earnings derived from capital market instruments issued due to Capital Market Law.

In determining net income from capital investment, costs related to and allowed to be deducted from gross income include insurance costs, collection costs, and taxes and other levies, excluding income tax, paid for securities.

The mentioned elements are included in business profit when they are connected to the business activity of the recipient. In such case, this income is treated as business profit and become subject to the rules described earlier.

Source: Revenue Administration

Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither MuhasebeNews nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.

1- On condition that they are taken back at the end of the agreement and on the purpose of lease back within the scope of Leasing, Factoring and Financing Companies Law dated 21/11/2012 and numbered 6361,
The period of holding the assets in the active accounts of the leasing, participation, development and investment banks should be taken into consideration for the selling of transferred properties to
1.1- The financing companies by the corporations,
1.2- The development and investment banks and participation banks in the selling of properties to the third persons by the leasee on the occasion of sale and release and take back procedure.

2- In the selling of the properties transferred to the leasing companies to the third persons by the parent company for the purpose of lease certificate purchase/sale transactions within the scope of Capital Market Law dated 06.12.2012 and numbered 6362, the period of time of the active account of leasing company should be taken into consideration while calculating of period of holding the assets in the active account.

Source: Corporate Tax Law

Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither MuhasebeNews nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.