Evaluation of donations and aids in terms of income, corporate and value added tax law

Donations and aids occur between the donor and the recipient. However, when evaluated from a tax perspective, there is also a side of the issue that affects the state. There are tax advantages for taxpayers who make donations, especially in terms of income, corporate and value-added taxes. Taxpayers who make donations under the regulations and conditions in the law may take their donations into account as a deduction or expense item in determining their tax base. It is important for taxpayers to examine the conditions and regulations required for the deduction of donations and aids from the tax base and the tax laws separately in terms of the application of the deduction. Therefore, it is important to address the differences in the deduction of donations and grants from income in terms of the Corporate Tax Law, Income Tax Law and Value Added Tax Law and to include explanations regarding the problems encountered in practice. In Turkish tax law, while some donations and aids are subject to a certain limit, others are not. Therefore, a clear distinction in tax legislation between donations and aids that are subject to a specific limit and those that are not would be beneficial for donors. One of the most significant findings of this study is that, although the existing tax incentives hold considerable potential to enhance social welfare, their implementation is hindered by several structural problems. In particular, the legal status of recipient institutions, the ambiguity regarding deductible rates, and the lack of robust audit mechanisms make it difficult for donations to achieve their intended purpose. Although the legislation allows deductions for donations made to associations recognized as serving the public interest and to foundations granted tax exemption by the President, the lack of up-to-date and transparent access to the official status of these entities constitutes a significant deficiency for donors. viii Moreover, in terms of VAT practices, the fact that free-of-charge deliveries often incur VAT has been identified as a factor hindering the widespread use of donations. In practice, taxpayers often hesitate to determine whether donations are subject to VAT. This situation becomes particularly evident during disasters, as documenting urgent and largevolume donations and making them eligible for tax advantages becomes complex for taxpayers. Legal regulations regarding the concepts of donation and aid are complex and irregular. Therefore, making the regulations more comprehensible and consolidated will enhance the social impact of donations and aids, and ensure that donations are made appropriately. In addition, during the evaluation of donations and aid within the scope of tax legislation, examining the types of donations and aid made domestically and abroad and their status within the scope of tax legislation after the Kahramanmaraş Earthquake that occurred in our country on February 6, 2023 will contribute to a clearer understanding of donations and aid. In conclusion, the study recommends that donations and aid should be restructured in line with the principles of transparency, equality, and public benefit from a tax perspective. Key recommended policies include simplifying legislation, expanding the VAT exemption for donations, making institutions with established status accessible on a common, digital platform, and establishing an annual independent audit system. These approaches aim to both offset tax losses and maximize the social impact of donations.