# Do You Need to Pay Withholding Tax and VAT for GoDaddy Domain & Hosting in Turkey?

## **Do You Need to Pay Withholding Tax and VAT for GoDaddy Domain & Hosting in Turkey?**

Purchasing domain names, hosting services, and other digital products from global providers like **GoDaddy** is part of everyday business for many Turkish companies. But when it comes to tax compliance, the big question often arises:  
**"Do I need to pay withholding tax and VAT on these purchases?"**

The answer depends on the type of tax we’re talking about.

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### **1\. Withholding Tax (Stopaj) – Usually *Not Applicable***

Under the **Turkish Corporate Tax Law (Article 30)** and **Income Tax Law (Article 94)**, payments made to non-resident companies for certain services may require a withholding tax deduction.

However, since **GoDaddy** is based in the United States, the **Turkey–US Double Taxation Avoidance Agreement (DTA)** comes into play. According to the treaty:

* If GoDaddy does **not** have a **permanent establishment** (such as an office or branch) in Turkey, payments for electronic services are **not subject to withholding tax**.
    
* This covers **domain registrations, hosting plans, email services, SSL certificates, etc.**
    

📌 **Conclusion:** No withholding tax is applied for GoDaddy domain and hosting purchases in most cases.

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### **2\. VAT via KDV-2 Return – *Yes, You Must Pay***

While withholding tax might not apply, **Value Added Tax (VAT)** rules tell a different story.  
Under **Turkish VAT Law (Articles 1 and 9)**:

* Services purchased from abroad and consumed in Turkey are considered **service imports**.
    
* For such services, VAT must be declared and paid via the **KDV-2 return** by the Turkish recipient.
    

For example:

* **Domain registration fee:** 1,000 TRY
    
* **VAT (20%)**: 200 TRY (declared via KDV-2)
    
* If you are VAT-registered, you can deduct this VAT in your KDV-1 return.
    

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### **3\. Summary Table**

| Tax Type | Applicable? | Rate | Declaration Method |
| --- | --- | --- | --- |
| **Withholding Tax** | No | \- | \- |
| **VAT (KDV-2)** | Yes | 20% | KDV-2 Return |

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### **4\. Key Takeaways for Businesses**

* **No withholding tax** for GoDaddy domain and hosting under the Turkey–US DTA (unless GoDaddy has a permanent establishment in Turkey).
    
* **KDV-2 VAT declaration is mandatory** if the service is used in Turkey.
    
* Keep all invoices and payment records for compliance and audits.
    
* If you are VAT-registered, you can deduct the VAT paid on these purchases.
    

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💡 **Pro Tip:** Even if the invoice from GoDaddy doesn’t show VAT, you are still responsible for calculating and paying it in Turkey via the reverse charge mechanism.

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info@ozmconsultancy.com