Will withholding be made from the institutions forming the partnerships established as a consortium?

31.05.2021

• Institutions dealing with construction and repair works for more than one calendar year are deducted 3% from the progress payments made in relation to these works.

In the construction and repair works (including the supply of machinery, equipment and vehicles) that are longer than the years undertaken by the companies acting as a consortium, if;

– the conditions required for the definition of “consortium” are included in the consortium agreement between the companies,

– the entire work can be divided into sub-stages and the price to be paid for each part is determined in the contract made between the administration and the consortium,

– the procurement work is carried out directly by the head office abroad and without any contribution from the workplace in Turkey, in contracts involving the procurement of machinery, equipment and vehicles from abroad,

Payments made for the tendered work will be evaluated separately, limited to the work undertaken by the consortium member companies in terms of tax deduction.

In the construction works tendered in this way, the contracted work will be divided into sub-stages as a whole and a tax deduction will be made for the part related to the construction and repair works spread over more than one calendar year.

Source: Revenue Administration of Turkey – Translated by: Karen Audit
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