What Is VAT Refund (KDV İadesi)?
A VAT refund in Türkiye is the return to the taxpayer of input VAT that cannot be recovered through offset, typically because of exempt transactions such as exports or the application of reduced rates.
Turkish VAT works, as a rule, by offsetting input tax against output tax. Where a burden remains that offset cannot absorb, a refund may be claimed for those transactions to which the legislation grants a refund entitlement.
The principal refund-generating transactions are exports of goods and services, deliveries made for export, supplies subject to reduced rates, certain transactions under an investment incentive certificate, and transactions subject to VAT withholding.
The process is documentary. Claimants must submit input VAT schedules, sales and purchase documents, and evidence that the transaction falls within the exemption. Depending on the amount and the type of transaction, a refund may be made by offset, against a guarantee, on the strength of a YMM certification report, or following a tax inspection.
For export-driven companies this is a cash flow question as much as a compliance one. Delay ties up working capital, so document discipline and the timing of claims are normally treated as part of financial planning rather than an administrative afterthought.