Fixed Asset Share Calculation in Turkish VAT Refunds: The Cumulative Method of Communiqué No. 55
Short answer: Fixed asset share calculation changed with Communiqué Serial No. 55 to Turkey’s VAT General Implementation Communiqué, published on 4 September 2025. VAT on depreciable fixed assets (ATİK) now enters the refund calculation at a cumulative ratio: the value of refund-eligible transactions since the asset was first used is divided by the total transaction value over the same period; this ratio is applied to the asset’s VAT, and shares given in earlier periods are deducted. If the result is negative, no share is given for that period.
This article explains the new method step by step, with a four-month numerical example and the most common mistakes in practice.
What is the fixed asset share, and how does it enter the refund calculation?
Depreciable fixed assets are the machinery, vehicles, plant and similar assets used in production or in providing a service. The VAT paid when buying them can be included in VAT borne (yüklenilen KDV) to the extent they are used in refund-eligible transactions.
VAT borne is calculated in three layers: direct costs first, then the overhead share, and finally the fixed asset share. The total cannot exceed the maximum refundable amount found by applying the general VAT rate (20%) to the transaction value. The fixed asset share is therefore also limited by the room left after the first two layers. We explain the logic of the three layers in Turkish VAT refund calculation; this article focuses on the fixed asset layer.
What did Serial No. 55 change?
The Communiqué Amending the VAT General Implementation Communiqué (Serial No. 55) was published in Official Gazette No. 33007 on 4 September 2025 and entered into force the same day. The fixed asset rules were added as new paragraphs and a worked example in section IV/A-3.1.3 of the Communiqué.
Before the amendment, the common reading in practice was that fixed asset VAT could largely be included in the refund calculation from the period the asset started to be used in a refund-eligible transaction, within the refundable VAT ceiling. The new rule limits this amount to the asset’s share of use in refund-eligible transactions.
Topic | Rule introduced by Serial No. 55 |
|---|---|
Ratio | Refund-eligible transaction value since first use ÷ total transaction value over the same period (cumulative) |
Base amount | The portion of the asset’s VAT that could not be offset through deduction |
Earlier periods | Shares given in earlier periods are deducted from the maximum share |
Negative result | No share is given from the asset for that period |
Under-allocated share | Cannot be added directly in later periods without applying the ratio |
Unit of calculation | Each asset separately; one calculation is allowed for assets capitalised in the same period |
Transition: assets bought in earlier years
The Communiqué contains no transition provision specific to fixed assets. In practice, the prevailing reading is that the method also applies to assets capitalised before 4 September 2025, from the start of their use. This raises the question of whether asset-level revenue data exists for earlier years. For high-value assets, requesting an advance ruling (özelge) and documenting the allocation method in writing is recommended.
The cumulative method step by step
The calculation is made in five steps for each asset in each refund period:
Set the base amount. Deduct the portion offset through deduction from the VAT paid on the asset. The remainder is the base of the calculation.
Calculate the cumulative ratio. Divide the value of refund-eligible transactions from the period the asset started to be used up to and including this period by the total transaction value over the same period.
Find the maximum share. Multiply the base amount by the cumulative ratio.
Deduct earlier shares. From the maximum share, deduct the total share taken from this asset in earlier periods. If the result is negative, no share is given this period.
Check the ceiling. The remaining amount cannot exceed the room left in the maximum refundable VAT after direct costs and the overhead share. The share given this period is the lower of the amount in step 4 and this room.
In short:
Fixed asset share for the period = Base amount × (Cumulative refund-eligible transaction value ÷ Cumulative total transaction value) − Shares given in earlier periods
Because the ratio is recalculated every period, the maximum share shrinks when the weight of refund-eligible transactions falls. Earlier shares can then exceed the maximum share, and no share can be given from the asset for a while. In the Communiqué’s example, the only consequence is that no share is given for that period; no separate adjustment is foreseen for shares already given. A new share can be given once the cumulative ratio rises again.
Example: one machine, four months
An exporting manufacturer buys a machine for TRY 5,000,000 in December and pays TRY 1,000,000 of VAT. The machine goes into production in January; part of the output is exported and part is sold domestically. In the January return, TRY 200,000 of the machine’s VAT is offset through deduction. The remaining TRY 800,000 is the base amount for the fixed asset share.
To keep the example simple, we assume there is enough room every month in the maximum refundable VAT after direct costs and the overhead share. Amounts are cumulative TRY from January to the month shown.
Period | Refund-eligible transaction value | Total transaction value | Ratio | Maximum share | Earlier shares | Share for the period |
|---|---|---|---|---|---|---|
February | 2,000,000 | 5,000,000 | 40% | 320,000 | 0 | 320,000 |
March | 4,500,000 | 9,000,000 | 50% | 400,000 | 320,000 | 80,000 |
April | 5,000,000 | 12,500,000 | 40% | 320,000 | 400,000 | 0 |
May | 11,000,000 | 20,000,000 | 55% | 440,000 | 400,000 | 40,000 |
February: The cumulative ratio is 40%. The maximum share is 800,000 × 40% = TRY 320,000. With no earlier share, all of it is included in the refund calculation.
March: Exports gain weight and the ratio rises to 50%. The maximum share is TRY 400,000; after deducting the earlier TRY 320,000, a share of TRY 80,000 is given this month.
April: Most sales this month are domestic and the cumulative ratio falls to 40%. The maximum share is TRY 320,000, while earlier shares total TRY 400,000. The difference is negative, so no share is given from the machine this month.
May: Strong exports lift the ratio to 55%. The maximum share is TRY 440,000; after deducting the earlier TRY 400,000, a share of TRY 40,000 is given.
After four months, the total share included for the machine is TRY 440,000. This equals the base amount multiplied by the cumulative ratio (55%), which is exactly what the method aims for. The remaining TRY 360,000 of the base amount can enter the refund calculation in later periods as the ratio rises.
The Communiqué’s own worked example applies the same logic to a truck tractor unit and adds one more step: in one month the maximum share comes out at TRY 250,000, but only TRY 150,000 of room is left in the maximum refundable VAT after the overhead share, so the share is limited to TRY 150,000.
Common mistakes
Calculating the ratio with the current period’s transactions only
Under the new method the ratio is cumulative: transaction values for all periods since first use are added up. A ratio calculated with the current month’s revenue alone overstates the share in export-heavy months. In the example above, May’s own ratio is 80%, while the cumulative ratio is 55%.
Not tracking earlier shares
The amount deducted from the maximum share is the total of shares given for the same asset to date. When this information sits in a separate Excel file each period, the total gets lost and the same share can be given twice. The share given per asset must be kept in a permanent record.
Setting the start of use incorrectly
The cumulative calculation starts from the period in which the asset is capitalised and actually put into use. When the capitalisation and first-use dates differ, or the asset sits idle for a while, the start period and the revenue in scope must be shown clearly in the file.
Changing the revenue scope from period to period
Which transactions go into the denominator, for example the company’s total revenue or the revenue of the production line where the asset is used, must be decided once and documented with its rationale. Changing the scope from period to period makes the cumulative ratio meaningless and is one of the first questions raised in an inspection.
Adding an under-allocated share directly in a later period
If a share below the maximum was given in a period because of the ceiling, the difference cannot be added to the refund calculation in a later period without applying the ratio. It is reassessed automatically in the next period’s cumulative calculation.
Asset-level cumulative tracking in SAP
All the data the cumulative method needs is in SAP. Asset master data shows the capitalisation date and purchase invoice, FI postings show the portion of VAT offset through deduction, sales and export documents show refund-eligible and other transaction values, and cost and profit centres show which production line the revenue belongs to.
The difficulty is bringing this data together at asset level every period and carrying the cumulative totals of earlier periods forward without loss. In a manufacturer with dozens of assets, the cumulative ratio, maximum share and earlier shares are calculated separately for every asset in every refund period. In Excel, this tracking breaks down after a few periods.
Finpro İade KDV calculates the fixed asset share inside SAP using the cumulative method of Serial No. 55. For each asset, the start of use, base amount, cumulative transaction values and shares given are kept permanently; the share for the period is found automatically, together with the room left after direct costs and the overhead share. The denominator of the ratio can be defined as the company’s total revenue or the revenue of the line where the asset is used; the company makes this choice based on its structure, and the chosen scope is applied the same way every period. The fixed asset table attached to the refund file is prepared from the same data.
Frequently asked questions
When did Serial No. 55 enter into force?
The Communiqué was published in Official Gazette No. 33007 on 4 September 2025 and entered into force on the date of publication.
Does the cumulative method apply to machines bought before 2025?
The Communiqué has no transition provision specific to fixed assets. The prevailing view in practice is that the calculation should be made from the period the asset started to be used. If asset-level revenue data is not available for earlier years, documenting the allocation method with its rationale and obtaining an advance ruling for large amounts is recommended.
If several machines are capitalised in the same month, is the calculation made separately?
As a rule, the calculation is made separately for each asset. In businesses that produce using several fixed assets, one calculation can be made for assets capitalised in the same period.
What happens if part of the asset’s VAT was offset through deduction?
The share is calculated only on the portion that could not be offset through deduction. For example, if TRY 200,000 of TRY 1,000,000 of VAT was offset, the cumulative ratio is applied to the remaining TRY 800,000.
Conclusion
Under Serial No. 55, fixed asset VAT enters the refund calculation in proportion to the asset’s use in refund-eligible transactions over its life. The method rests on four pieces of information: the base amount, cumulative transaction values since first use, shares given in earlier periods and the room left in the maximum refundable VAT. When these four are carried forward for each asset from period to period without loss, the calculation fits in a few lines and is easy to explain in an inspection.
Let’s calculate your fixed asset share with your SAP data: you can request a demo on the Finpro İade KDV page. For the next step, see Turkish VAT refund errors in SAP: 7 common mistakes and a checklist.
Sources
Turkish VAT refund calculation: direct costs, overheads and fixed assets — Finpro Blog
Communiqué Amending the VAT General Implementation Communiqué (Serial No. 55) — Official Gazette, 4.9.2025, No. 33007 (in Turkish)
New rules on refunding VAT borne on fixed assets — KPMG Vergi (in Turkish)
Circular on VAT General Implementation Communiqué Serial No. 55 — Andersen Türkiye (in Turkish)
The fixed asset calculation method under Serial No. 55 — Alomaliye, Muzaffer Emekci (in Turkish)
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