E-Commerce and Artisans Tax Exemption

The phrase "I sell online, there is a tax exemption" is thrown around a lot. There is some truth to it, but the scope is much narrower than people think.

Not knowing who the exemption applies to often results in retroactive tax liabilities and penalties later on.

What does artisan exemption mean?

The Income Tax Law excludes certain very small-scale activities from taxation. This is known as the "artisan exemption" and does not require business registration.

The part related to online sales specifically focuses on: those who sell products they produce themselves at home via the internet and similar electronic environments.

The critical word here is "produced themselves." It refers to products made with your own labor, such as handicrafts, sewing, knitting, jewelry, and homemade food.

Buying and selling ready-made products — meaning traditional trading — is not covered by this exemption. If you buy wholesale and sell retail, you cannot benefit from the exemption.

Conditions

The general conditions required to benefit from the exemption are as follows:

Artisan exemption certificate. It is obtained from the tax office and forms the official basis of the exemption.

Separate bank account. Sales revenues must be collected through a bank account exclusively dedicated to this activity. This condition forms the basis of audits.

Revenue limit. Annual revenue must not exceed the specified amount. When the limit is exceeded, the exemption is lost for that year.

Workplace and employee limit. Conducting the activity without using industrial-type machinery or opening a physical shop.

Limits are updated every year; verify the current figure and conditions for your situation with your financial advisor.

Banks and marketplaces report

It is important to be clear about this: online sales are not invisible.

Marketplaces and payment institutions have reporting obligations on a per-seller basis. Your bank transactions are also among the data accessible to the tax administration.

This means that if you have a regular and continuous sales volume, it can be detected that you are carrying out an activity requiring tax registration. Retroactive tax registration, principal tax, late payment interest, and penalties all come together.

If tax registration is required

If there is continuity and a profit motive, the right path is to register your business. We covered setting up a sole proprietorship and the first steps in this article.

Once you are a registered taxpayer, the first topics you will encounter are invoice layouts, VAT returns, and the lower e-invoice threshold in e-commerce. Check out the e-invoice limits article.

We covered common mistakes in e-commerce accounting in a separate article.

Frequently asked questions

Do I pay tax if I sell my second-hand items?

Selling your own used items occasionally is not considered a commercial activity. However, the situation changes when it turns into buying and selling. The criteria are continuity and profit motive.

I generate content revenue from social media, is it the same?

There is a separate earnings exemption regulation for social content creators, and its conditions are different. We touched upon this in the social media sales article.

Do I need to issue an invoice if there is an exemption?

If you are covered by the artisan exemption, you do not issue invoices; the taxpayer buying from you issues an expense receipt. Check out the expense receipt article.

What happens if I exceed the limit mid-year?

The exemption is lost for that year, and tax registration becomes mandatory. Therefore, tracking your revenue throughout the year is essential.

The exemption is real but narrow. Clarifying which side you are on early on prevents retroactive surprises later.

You can open a free account on Qolay.App and track your sales volume from day one.