TAX NEWS NO: 2013/5
April 19, 2013
Legislation change in the Capital Movements Circular of the Turkish Central Bank regarding the capital advance payments.
Turkish Central Bank has recently issued the Circular numbered 2013/YB-7 which removed the term “capital advance” from the legislation on the payment of foreign capital.
According to the new regulation, Turkish banks no longer accept payments from non-resident shareholders under the classification of “capital advance”. Practically, these payments will be required to be classified either as a subscribed “capital payment” or “capital increase payment”. The concerning funds shall not be released by banks until actually registered as capital.
Effectively, proper legal advice should be obtained prior to taking any action in respect of the abovementioned legislation.
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