How Does a Tax Audit Work in Turkey?

A tax audit is a supervisory process, subject to its own procedural rules, conducted to verify the accuracy of a taxpayer's declarations and books and records. Understanding how the process works is important for a taxpayer to exercise their rights effectively.

Commencement and Authority

Under Article 134 et seq. of the Tax Procedure Law (VUK), tax audits are conducted by tax inspectors or other authorised officials. The audit is, as a rule, carried out at the taxpayer's place of business; it may also be conducted at the tax office if the taxpayer requests it or the auditor considers it necessary. Before the audit begins, a "Commencement of Audit Record" is drawn up for the taxpayer.

Taxpayer Rights

During the audit, the taxpayer has the right to learn the subject and scope of the audit, to request a reasonable period to produce books and records requested by the auditor, to be accompanied by a professional (accountant or lawyer), and to comment on the report prepared at the conclusion of the audit.

Duration of the Audit

Under VUK Art. 140, a full audit must be completed within one year and a limited audit within six months. These periods may be extended by up to a further six months, with reasoning and the approval of the relevant unit. Audits not completed within these periods continue upon notice to the taxpayer, but this alone does not invalidate the audit.

The Importance of the Audit Record

The records drawn up at the end of the audit capture both the matters covered by the audit and any objections raised by the taxpayer at that stage. Since the taxpayer has the right to note reservations when signing the record, clearly recording any points of disagreement provides an important basis for the later settlement or litigation stage.

Practical Recommendations

Provide the documents requested by the auditor completely and on time; incomplete or late submission can increase the risk of an unfavourable outcome. Consulting an accountant or tax lawyer about the process before the audit report is served strengthens your strategy for the subsequent settlement or litigation stage.

This article is for informational purposes only and does not constitute legal advice. Please contact our team regarding your specific situation.