Under-Declaring the Price on the Title Deed: The Penalty Quadrupled in 2026

One sentence comes up at almost every closing table in Turkey: "So what figure do we write on the deed?"

For years the answer has often been a number below the real price, with both sides believing they are saving on the fee. Let me be direct: that arithmetic changed in the final days of 2025, and very few people have noticed. The same shortcut now costs four times as much.

The Rule First: What Is the Fee Calculated On?

Under Law No. 492 on Fees, the title deed fee is 4% of the actual sale price. In practice the buyer pays 2% and the seller pays 2%. The parties may agree that one side covers everything, but that arrangement is between them; towards the administration, both remain liable for the full amount.

The second rule is less widely known: the declared price cannot fall below the property tax value. The value the municipality assigns to that property is the floor for what you may write on the deed. You cannot go under it, and above it the figure should simply be the real sale price.

What Changed on 19 December 2025

If the declared price is found not to reflect reality, the fee corresponding to the difference is assessed additionally or ex officio, and a tax loss penalty is imposed on top. That much has been the case for years. What changed is the rate of that penalty.

Law No. 7566 replaced the phrase "at a rate of 25%" in Article 63 of the Law on Fees with "one full rate". The amendment was published in the Official Gazette dated 19 December 2025 and entered into force the same day. In plain terms: a penalty that used to be one quarter of the underpaid fee is now equal to the entire underpaid fee.

The figures above are illustrative values chosen to show the mechanism; they do not describe a real transaction. Late interest is calculated separately, based on the period between the transaction date and the payment date.

Notice there is no "saving" line in that table. The amount avoided through under-declaration is reclaimed the moment it is detected. What remains is the penalty and the interest.

The Real Trap of 2026: The Floor Moved Up

Here is what matters most. The same legislative package also opened the way to a substantial increase in the values used as the basis for building and land tax. For 2026, those values can rise to as much as three times the previous year's figures.

The practical consequence is significant. Suppose the figure written on a deed last year sat just above the property tax value of the time. Write a similar figure this year out of habit, and you may land below the floor without intending anything at all. An under-declaration file can form without bad faith, in a period when the penalty rate has also risen.

The Buyer Pays the Real Cost Later

This is the part rarely discussed. Say a figure below the real price was written and nobody noticed. Did the buyer come out ahead? No. The bill was postponed, not avoided.

When that property is sold later, the low figure on the deed counts as the acquisition cost. The gap between it and the future sale price is artificially wide. If the property is sold before five years have passed since acquisition, capital gains tax is calculated on that inflated gap. The amount not written to avoid the fee returns as a far larger tax base a few years down the line.

Buyers using a mortgage face a separate problem. The bank's valuation reflects the property's real worth, so a far lower figure on the deed creates an inconsistency in the file. I have written before about why pricing has to be set correctly from the start; the same logic applies to what you declare.

What If an Under-Declaration Was Already Made?

The door is not closed. The remorse provisions of the Tax Procedure Law give room to a taxpayer who comes forward voluntarily. If the application is made before the administration makes any determination and before any step that blocks remorse begins, no tax loss penalty is imposed; the underpaid fee is paid together with the remorse surcharge.

The decisive word here is "before". An application made after a determination does not carry that protection. There are also intermediate mechanisms such as the invitation to explain. These are technical matters, and the step should be handled with a certified public accountant or a tax lawyer.

So How Is It Done Properly?

It is not complicated. Three steps before the appointment remove the problem entirely.

One: Obtain the property's current property tax value from the municipality. That is your floor.

Two: Keep the price in the contract and the price declared on the deed identical. A gap between the two creates a problem of proof later. I have covered why the contract is so decisive in a sale process in a separate article.

Three: Put in writing who pays the fee. A verbal understanding is the single most common source of argument at the deed office.

Working these items out before a purchase or a sale is far more comfortable than meeting them on the day of the transaction. Would you like to go through the fee, tax and cost side together before the process starts?