Loans obtained by Turkish residents from foreign creditors may be subjected to an additional tax burden known as the RUSF. The RUSF applies irrespective of whether the creditor is a bank/inancial institution or a company within the borrower’s group. The rate varies between 0% and 3% depending on the currency denomination, the business of the creditor and the maturity of the loan concerned. For instance, foreign currency loans obtained abroad by Turkish banks and financial institutions would in any case benefit from a reduced 0% RUSF tax rate.

However, for other taxpayers, the applicable RUSF rate, the basis of which is the principal of the loan, is determined on a declining scale depending on the maturity of the loan (see the chart below)

Maturity of the Foreign Currency Loan (Fiduciary transactions are excluded) Applicable RUSF Rate:

– Average maturity up to 1 year: 3%

– Average maturity between 1 year (inclusive) and 2 years: 1%

– Average maturity between 2 years (inclusive) and 3 years: 0.5%

– Average maturity of 3 years (inclusive) or more: 0%

According to the RUSF legislation, any import which is made on credit (unless the price for to the import is paid before the actual importation) is subject to a special charge amounting to 6% of the value of the goods to be imported.

The important criteria in this regard are the payment term and whether it is a cash payment or payment on credit. The following imports are accepted as import with credit according to the RUSF legislation:

– Import with cash on delivery

– import with acceptance credit,

– import with the deferred payment letter of credit