Due to the economic difficulties experienced in our country in recent times, many companies have fallen into financial distress and, as a result, have begun to struggle to meet their debt obligations. This situation naturally affects the companies that are creditors to these firms and, consequently, indirectly impacts their financial strength in a negative way.
.
For these reasons, debt restructuring agreements or promissory notes are frequently signed in practice, and as a result, the terms of companies’ debts—such as repayment schedules and collateral—are often modified or renewed. However, debt restructuring or installment plans implemented without fully understanding the details can lead to even greater losses for companies.
The debt restructuring process involves certain institutions occasionally restructuring the debt to provide the debtor with payment flexibility. The debtor may apply to the relevant authorities with the necessary documents to restructure the debt in a manner suitable for their budget and make payments accordingly.
Th e restructuring of tax debt, as addressed in Article 48 of Law No. 6183 on the Procedures for the Collection of Public Receivables, includes restructuring, deferral, and installment plans to protect public receivables, as well as ensures the continued assessment and collection of public receivables by introducing provisions such as a written request, provision of collateral, and most importantly, the taxpayer being in “extreme financial hardship,” provided the taxpayer demonstrates good faith.
How does the tax debt restructuring process work?
To initiate the debt restructuring process, a debt inquiry must first be conducted. Individuals who confirm the existence of a tax debt and obtain the debt details should submit a restructuring application. Applications made within the specified timeframe during the restructuring phase may be submitted to the tax office in person via a written petition or by mail. For online applications, all required identification information, including the Turkish ID number, must first be entered.
Who is eligible to apply for debt restructuring?
Individuals listed as debtors in tax office records,
Taxpayers (including those who issue fake invoices)
Those subject to penalties
Individuals deemed public debtors due to debt settlements
Certified public accountants are jointly and severally liable with the taxpayer for the payment of the debt.
They may benefit from this program depending on the amount they are obligated to pay.
For which tax debts can a deferral and installment plan be requested?
Value-Added Tax
Provisional Tax,
Excise Tax,
Banking and Insurance Transactions Tax
Special Communication Tax,
Fees (excluding land registry fees based on additional assessments),
Funds,
Contribution Shares (including Education Contribution Share and related late payment penalties),
Fees
What is the interest rate for payment deferral and the maximum installment period?
The interest rate for payment deferral is 12% annually. By law, the maximum installment period is 36 months.
For all these reasons, since these matters must be taken into account and relevant provisions must be included in the related contracts and protocols during the restructuring of existing debts through changes to payment terms or the provision of collateral, we recommend that you seek professional assistance.