The suggestion always arrives a few days before the title deed appointment, and it is put as a favour: let's write a lower figure on the deed, we both save on the fee. The buyer proposes it, the seller thinks about it, and the agent in the middle usually says nothing. For sales made from 19 December 2025, the cost of that decade-old habit quadrupled — and the ways it gets detected have changed beyond recognition since the habit formed.
If you are buying or selling in Turkey from abroad, this is one of the few points where going along with local custom can cost you more than it saves. It is worth understanding exactly what changed.
What changed: four words removed from the Fees Law
The title deed fee (tapu harcı) is 4% of the sale price in total: 2% from the buyer and 2% from the seller. A long-standing rule also applies: the declared price cannot be lower than the municipality's property tax value.
Until December 2025, the sanction for under-declaring carried a special discount. The tax loss penalty, normally 100%, had since 2017 been applied at 25% for title deed fee shortfalls. That discount was the arithmetic behind the whole habit: even if we are caught, we are caught cheaply.
Law No. 7566, published in the Official Gazette on 19 December 2025, changed the words "at the rate of 25%" in Article 63 of the Fees Law to "one times", meaning a penalty equal to the whole of the fee that was underpaid. The penalty for the same act went from 25% to 100% — four times higher.
The timing matters more than people expect: the rate that applies is fixed by the date of the transaction, not the date the penalty is issued. A sale made before 19 December 2025 and examined today falls under the old rate; one made after that date falls under the new one. If a full penalty has been applied to an older transaction of yours, that is a point worth challenging.
In numbers: a ₺10m flat declared at ₺5m
A scenario we see regularly in Istanbul. The real price is ₺10,000,000; ₺5,000,000 is declared at the deed.
| Buyer | Seller | |
|---|---|---|
| Fee paid (5,000,000 × 2%) | ₺100,000 | ₺100,000 |
| Fee that should have been paid (10,000,000 × 2%) | ₺200,000 | ₺200,000 |
| Shortfall | ₺100,000 | ₺100,000 |
| Tax loss penalty (one times) | ₺100,000 | ₺100,000 |
| Late-payment interest | depends on the date of detection | depends on the date of detection |
| Total, interest excluded | ₺200,000 | ₺200,000 |
The saving each side believed it was making was ₺100,000. If detected, each pays twice that before interest. Under the old rate this line would have stopped at ₺125,000; today it is ₺200,000.
And note: the penalty is issued to both sides separately. "The buyer asked for it, I stayed out of it" does not protect the seller — both parties sign.
The figures above are chosen to show the mechanism. What your own file comes to depends on the shortfall found, how long interest has run, and which of the routes below you use.
How it is detected: no tip-off required
The old habit rested on an assumption — that under-declaration could only surface if somebody reported it. Today the administration runs an analysis layer that automatically compares the price declared at the deed against several data sources at once:
- The municipality's property tax value. Because the four-yearly reassessment landed this year and values rose sharply, this floor rose with it — see Turkey's 2026 property tax reassessment. A declaration that looked comfortably above the line last year can fall below it this year without anyone changing anything.
- Actual sales in the same building and street. Your neighbour's deed price from three months ago becomes the reference point for yours.
- Bank appraisal reports. If the buyer used a mortgage, the bank's valuation report is already in the system as an official document. A ₺10m appraisal and a ₺5m declaration sit side by side.
- Account movements. The sum moving between the parties around the sale date produces a signal when it does not match the declaration.
There is an important legal nuance here: this data produces indicia, not proof on its own. The statute contains a limiting sentence — an assessment cannot be raised under this provision on the basis of assessment commission decisions. "The commission valued it at X, so you under-declared" is not sufficient by itself. Assessments not grounded in a concrete finding can be, and are, litigated.
If it lands on your desk: four routes
When a letter arrives, paying in a panic and ignoring it are the two most expensive options. In order:
1. Voluntary disclosure (Tax Procedure Law, VUK art. 371). If you come forward before the administration has made a finding, declare the position and pay the shortfall, no tax loss penalty is issued; you pay a disclosure surcharge instead. This door is only open while you are still the one moving first.
2. Invitation to explain (VUK art. 370). Where the administration finds an indication, it asks for an explanation before issuing a penalty. You have 30 days to respond. If your explanation is not accepted but you declare and pay within the period stated, the tax loss penalty is applied at 20% — a far smaller burden than one times. Once this invitation arrives, the voluntary disclosure route closes; missing the deadline is the costliest mistake available.
3. Settlement. Post-assessment settlement can reduce the penalty and sometimes part of the principal.
4. Litigation. The period for bringing a case before the tax court is generally 30 days. Where the transaction date precedes 19 December 2025, or the assessment rests only on commission or comparable data rather than a concrete finding, there may be arguable ground.
Which of these fits your file depends on the dates and on what the finding rests on; speak to an accountant or a tax lawyer before acting. The legislation itself can be checked at mevzuat.gov.tr and current practice at the Revenue Administration.
The fee is the small part of the story
Most owners think about this purely as a fee question. Under-declaration in fact presents a bill in three other places.
As a buyer, you are taxing your own future. If the flat recorded today at ₺5m is sold for ₺15m in three years, your capital gain is calculated not on the real ₺5m gain but on the ₺10m the register shows. For individuals, outside commercial activity, gains from disposing of a residence within five years of acquisition are declarable. The fee saved today is repaid several times over if the property sells before those five years are up.
As a seller, you take on the collection risk. When part of the price stays off the record and the buyer does not pay the balance, you hold no official document evidencing the claim. Legally, the sale price is whatever the deed says it is.
Both sides take on a sham-transaction risk (what Turkish law calls muvazaa). A price that does not reflect reality is a declaration that can be used against you in any later dispute over title, inheritance or divorce.
For foreign buyers there is one more consideration: where a purchase is connected to a residence permit or a citizenship application, the declared value and the appraisal report form part of that file too. A figure chosen to reduce a fee is not a figure you want working against a permit application later. Confirm the current requirements before the appointment rather than after.
There is also a quiet cost. A sale declared low drags down the comparable record for every flat in that building. When your neighbour sells six months later, your deed price is their reference. For an owner trying to defend prices in their own street, that loss is larger than it looks.
Doing it properly
Settle four things before you walk into the appointment:
- The declared price is the real sale price and cannot be below the municipality's tax value. Find out your tax value from the municipality in advance — it went up this year.
- Pay through the banking system. Put the property's parcel details or address in the transfer description. That ends any later argument about which payment was for what.
- Put the split of fees and commission in writing at the start of the negotiation, not on the day. Costs surfacing at the last minute are one of the most reliable ways to lose a sale — the fee structure is set out in our guide for foreign buyers.
- Price the property properly. The few hundred thousand lira saved on the fee is small against what is lost when a flat sits unsold for months. In a sale, the real money is lost to mispricing and delay, not to the deed fee.
Setting the price on comparable evidence rather than guesswork makes this conversation unnecessary in the first place and strengthens your hand in the negotiation. To see a realistic current range for your property, ask for a free valuation. If you are handling the sale from outside Turkey, our guide to selling your Istanbul property from abroad covers the power of attorney and the rest of the process. Nobody puts "let's declare it lower" on the table with an owner who walks in knowing the number.