The Tax Advantages of Printing Stocks

The Tax Advantages of Printing Stocks

The stock has an important place in the proof of the partnership of the company. In addition to this importance, the printing of stocks provides the opportunity to benefit from the exemptions brought by tax laws to the partner who transfers his shares, especially in share transfers. The tax advantages of issuing stocks appear as income tax for the real person partner, and especially stamp tax exemptions for the legal person partner. Thus, you will be exempt from paying high taxes with the stocks that you can print under appropriate conditions.

Exceptions Recognized by the Income Tax Law for Stocks

Pursuant to the fourth subparagraph of the first paragraph of the repetitive article 80 of the Income Tax Law No. 193, the gains arising from the disposal of company shares are subject to income tax within the scope of capital gains. However, in accordance with the first subparagraph of the paragraph, the gains obtained from the disposal of the share certificates belonging to resident corporations and held for more than two years are exempt from income tax.

Thus, while the real person shareholder of the joint stock company is subject to income tax within the scope of capital gains due to the gains it will gain while transferring its undocumented shares, if the stock has been printed and these shares have been held for at least two years, the shares arising from the transfer of the shares transferred with the stock. earnings, regardless of their amount, are not subject to income tax.

Exceptions Recognized by the Corporate Tax Law for Stocks

Pursuant to subparagraph 1/e of Article 5 of the Corporate Tax Law No. 5520, 75% of the profits arising from the sale of the founding shares owned by the corporations for the same period of time as the participation shares in their assets for at least two full years are exempt from corporate tax. Whether or not the subsidiary shares are tied to shares does not change the result.

For this reason, if the joint stock company shares, which are included in the assets of the corporations as participation shares, are sold out within two full years from the date they are taken into action, even if they are not attached to the year, the entire income from them is subject to corporate tax. If stocks or bare shares are sold after two full years from the date of entry into the company’s assets, 75% of the income obtained is exempted from corporate tax. In other words, having stocks printed for joint stock company shares does not provide an advantage in terms of corporate tax.

Exceptions Recognized by the Equity Value Added Tax Law

In accordance with the 4/g provision of the 17th article of the Value Added Tax Law No. 3065, the deliveries of the shares are excluded from the value added tax (VAT). With the 4/r provision of the same article, transfers and deliveries realized through the sale of participation shares that have been in the assets of the institutions for at least two full years are exempt from VAT.

In this context, if stocks have been printed for joint stock company shares included in the assets of institutions as participation shares, they are exempt from VAT no matter when these stocks are transferred after being activated. If the stock is not issued, the shares must be kept in the assets of the corporation for at least two full years in order to benefit from the said tax exemption.

Stock Printing and Advisory Services

As AEK Pay Senedi Consulting and Printing Center, we provide consultancy services about the tax advantages of issuing stocks. You can contact us for detailed information.

Updated : 17.06.2021