Transfers of assets that prevent the collection of a tax or other public debt may be the subject of an action to annul a disposition (tasarrufun iptali) under Articles 24–31 of Law No. 6183. The purpose of this action is to enable the creditor public administration to collect from a particular asset or from its value. Not every transfer of assets is void; the situation of the public receivable, the debtor’s assets, the nature of the transaction, the date of the transfer and the third party’s knowledge are examined together.
The view that every sale for consideration to a close relative is automatically treated as a gift is not correct under current law. The provision of Article 28(1) of Law No. 6183 to that effect has been annulled by the Constitutional Court. Nevertheless, genuine gifts, transactions at a very low price and dispositions made for the purpose of preventing collection may still be annulled if the other statutory conditions are met.
What result does an action to annul a disposition produce?
The annulment of a disposition does not aim to disregard the transaction between the debtor and the third party with respect to all persons. If the statutory conditions are met, the creditor public administration obtains the ability to proceed against the asset subject to the action in order to collect its receivable. For this reason, the action is not the same as an action for cancellation and re-registration of title.
Although the transfer of the asset may remain valid between the parties, its effect of preventing collection against the public administration may be removed. If the asset has been disposed of, liability based on its value may arise under Article 31 of Law No. 6183. In that case, the judgment must specify which person is held liable for which amount and on what legal ground.
The fact that the buyer has paid the sale price to the debtor does not give rise to a right to claim the same amount back from the public administration. The third party’s claims against the seller arising from the contract or from another legal relationship are assessed separately. In this way, the file on the annulment of the disposition is kept separate from the relationship of refund of the price or compensation between the parties.
Who files the action, against whom is it directed and which court hears it?
The action is filed by the competent public administration that wishes to collect the receivable. Article 24 of Law No. 6183 regulates the route of action before the general courts. An action based on a tax office’s receivable is not heard before the tax court merely because the receivable is a tax; as a general rule, the civil court of first instance (asliye hukuk mahkemesi) has subject-matter jurisdiction. Whether there is a special statutory provision on jurisdiction must be examined separately.
The joinder of parties is important with respect to the debtor and the persons who benefited from the transaction. Article 25 of the Law regulates the persons who entered into a legal transaction with the debtor or to whom a payment was made, their heirs, and other third parties acting in bad faith. The position of a subsequent owner in the file should not be assumed to be automatically the same as that of the first buyer.
The fact that a property has been transferred several times does not mean that each subsequent buyer is liable for the entire debt. The order of the transfers, the value obtained, the ground for annulment relied on and the subsequent person’s bad faith are assessed separately. Presenting the same template defense to all persons may cause the personal legal situations to be overlooked.
Why are the public receivable and the debtor’s assets investigated?
An annulment action is not an abstract examination of assets independent of the public receivable. The arising, assessment, maturity, enforcement status and current amount of the receivable must be made concrete. Particularly in the case of a later tax assessment, the date on which the notice was issued and the date of the event giving rise to the tax are not the same thing. When assessing whether the debt arose before the transfer, looking only at the date of the assessment document may be misleading.
Whether the debtor has other assets suitable for collection, whether the existing assets cover the debt, and the contents of the asset declarations matter according to the ground for annulment relied on. The finding that “there is a debt and a sale has been made” does not by itself prove all the conditions. The collection file, asset investigations, existing attachments, values and amounts collected must be assessed together.
The explanations on the certificate of insolvency (aciz belgesi) in the action to annul dispositions under private enforcement law should not be transposed unchanged to an action based on Law No. 6183. The opposite is also wrong: the fact that a certificate of insolvency in a particular form is not required does not mean that the debtor’s financial situation and the collection conditions set out in the Law will not be investigated.
Which transactions may be the subject of an annulment action?
Gifts and transfers without consideration
Article 27 of Law No. 6183 regulates gifts and dispositions without consideration, together with the asset declaration and asset conditions stated in the Law. The existence of an apparent sale does not prove that the transaction was necessarily for consideration. Whether the price was actually paid and whether there is an economic counter-value may be examined.
The third party’s defense should not be limited to repeating the sale amount written in the official deed. Bank payment records, the source of financing, the date of payment and actual delivery should be explained. The administration, for its part, must set out the facts on which it bases the allegation that there was no consideration.
Sales at a very low price relative to actual value
The second paragraph of Article 28 of the Law treats contracts whose price is regarded as very low relative to the value at the date of the transaction as falling within the scope of gifts. The measurement must be made on the basis of the conditions at the date of the disposition, not the present market value. Encumbrances on the property, construction and zoning problems, or legal restrictions on use may matter in calculating actual value.
If the price shown in the land registry differs from the actual payment, this difference must be documented. A unilateral statement prepared afterwards may not be as strong as a payment supported by bank movements. A technical report explaining the reason for the low price, comparable transactions on the same date and the contract terms should be submitted together.
Pledges, extraordinary payments and payment before maturity
Article 29 of Law No. 6183 regulates, under certain conditions, pledges given afterwards for an existing debt, payments made by means other than the customary means of payment, and payment of a debt that has not yet matured. Not every security transaction is automatically subject to annulment; statutory distinctions, such as an undertaking to provide security given earlier, must be examined.
The pre-existing contract, the genuineness of the debt, the maturity, the date on which the security was agreed and when it was actually established are the basic records of the defense. The mere creation of an accounting entry between companies does not in every case prove the genuineness of the debt and of the need for security.
Transactions made for the purpose of preventing collection
Article 30 of Law No. 6183 regulates transactions made with the purpose of leaving no possibility of collection where the debtor has no assets or the assets are insufficient for the debt. In bilateral transactions, the facts that the third party knew or should have known of the debtor’s purpose are important. Matters such as a commercial relationship, the closeness in time of the transfers, the actual use remaining unchanged and the price returning may be assessed together.
Each of these facts alone is not conclusive proof of bad faith. The defense may show that there was a genuine economic reason for the transaction and that the price entered the debtor’s assets. However, the fact that the real price has been paid does not end the Article 30 examination in all cases; the purpose of preventing collection and the other party’s knowledge are discussed separately.
What did the Constitutional Court decision change regarding sales to relatives?
By its decision dated June 22, 2023, E.2022/134, K.2023/116, the Constitutional Court annulled the first paragraph of Article 28 of Law No. 6183, which treated transactions for consideration between blood relatives up to the third degree, spouses and relatives by marriage up to the second degree as gifts. For this reason, the conclusive presumption in the former text of the Law should not be applied to a current file as if it were still in force.
The decision does not make all transfers between relatives immune from an annulment action. A genuine gift, a very low price or the purpose of preventing collection may be examined under the other provisions. The fact of kinship may also be assessed together with other evidence; but on its own it cannot replace the annulled conclusive rule on gifts.
In files concerning pending or older transactions, the date on which the decision entered into force, the stage of the proceedings and the applicable law must be examined separately. Generalizations such as “the Constitutional Court annulled it, so all the cases fall” or “the transfer is old, so the decision has no effect at all” are not a correct assessment of a file.
How are the two-year period and the five-year limit for bringing the action distinguished?
Under Article 26 of Law No. 6183, an annulment action based on Articles 27–30 cannot be filed once five years have passed from the date of the relevant disposition. This preclusive period (hak düşürücü süre) is different from the limitation period for collecting the debt. A separate disposition date must be determined for each transfer.
The two-year period counted backward from the start of the payment period, which appears in some of the articles, is a separate criterion that determines the scope of the transactions subject to annulment. Being within the five-year limit for bringing the action does not mean that the two-year period and the other special conditions are unnecessary. The phrase “regardless of their dates” in Article 30 also does not remove the five-year limit of Article 26.
| Check | What it determines | Record required |
|---|---|---|
| Arising and maturity of the debt | Relationship between the public receivable and the transaction | Taxation and collection file |
| Date of the disposition | Start of the five-year limit for bringing the action | Official deed, contract, payment |
| Start of the payment period | The two-year scope in the relevant paragraphs | Payment order and notification |
| Subsequent transfer | Liability of the subsequent owner and liability for value | Land registry transfer record |
How should the third party build the defense?
First, the procedural conditions of the receivable and of the action should be examined: the authority of the claimant administration, the parties, the claim, the date of the disposition and the time limit. Then the defense should be divided according to the ground for annulment relied on. The genuineness of the price and the allegation of not knowing about the purpose of preventing collection may not require the same evidence.
Bank movements at the date of the transaction, use of credit, land registry records, valuation, tax and fee payments, delivery and use records and commercial correspondence should be prepared together. The historical link of the evidence with the transaction should be explained; documents created after the action was filed should not be substituted for earlier records. If a precautionary attachment or another interim measure has been applied, its scope, amount, security and route of appeal should be examined separately. The fact that an action has been filed does not justify an unlimited attachment of all assets.
Conclusion
An annulment of a disposition affecting a public receivable requires separate proof of the debt, the disposition, the time limit and the legal situation of the third party. After the Constitutional Court’s annulment decision, an automatic gift cannot be inferred from kinship; on the other hand, the allegations of genuine absence of consideration, low price and prevention of collection retain their importance. The defense should set out the economic and legal reality at the date of the transaction rather than a general denial.
Related articles: Sale of Real Property Attached for Tax Debt: Annulment of the Auction, Time Limits and Remedies; Third-Party Claim in a Tax Attachment: How Is an Attachment of Another Person’s Property Lifted?; Precautionary Attachment for Tax Debt: Conditions, Annulment Action and Lifting; How Is a Tax Action Filed? Time Limits, Tax Penalties and Objection Routes.
Frequently Asked Questions
Is buying a home from a person with a tax debt annulled in every case?
No. The dates of the debt and the disposition, the price, the collection conditions and the ground for annulment relied on are examined. The section “Why are the public receivable and the debtor’s assets investigated?” explains the basic distinction. Related explanation
Is a sale to a relative automatically treated as a gift?
The former conclusive rule was annulled by the Constitutional Court. However, there may be other grounds for annulment. See the section “What did the Constitutional Court decision change regarding sales to relatives?” Related explanation
Is the time limit in an action to annul a disposition two years or five years?
These are periods with different functions. Five years concerns the limit for bringing the action, while the two years in the relevant articles concerns the scope of certain transactions. The section “How are the two-year period and the five-year limit for bringing the action distinguished?” is explanatory. Related explanation
Does the title necessarily return to the debtor?
An annulment of a disposition is not the same action as cancellation and re-registration of title. The public administration’s power to collect and the liability for value are determined according to the scope of the judgment. See the section “What result does an action to annul a disposition produce?” Related explanation
Sources
- Law No. 6183 on the Procedure for Collecting Public Receivables, Article 13, Articles 24–31
- Constitutional Court, June 22, 2023, E.2022/134, K.2023/116; annulment of Article 28(1) of Law No. 6183
- Constitutional Court Decisions Journal, Volume 60/5; official compilation of the same decision
- Revenue Administration, General Communiqué on Collection, Series A, Serial No. 1; explanations on the annulment of dispositions and Articles 26–31. The historical compilation must be read together with the current annulment decision