Doing Business Turkey And Taxes In Turkey - Full Legal Service

Income Taxes in Turkey

In order to doing business Turkey all natives, foreign individuals, foreign capital corporations and native companies residing in Turkey are imposed in income tax and corporation Taxes in Turkey also non-residents individual in Turkey who earning income.
Income taxes in Turkey are levied on all income, including that of domestic and foreign individuals and corporations residing in Turkey. Non-residents earning income in Turkey through employment, ownership of property, business transactions, or any other activity which generates income are also subject to taxation, but only on the income earned in Turkey

Corporate Income Taxes in Turkey

The determined basic company income tax rate on business profit is levied by 20% in Turkey.

Withholding Tax (stopaj Vergisi)

According to Turkish tax regulation, certain amount of taxes in Turkey is obtained by means of withholding from the corporates in order to be secure of paying tax by payers.

  •  Income tax on salaries of employees
  •  rent payments to landlords of the workplace
  •  Independent professional service fee payments to resident and non-resident individuals
  •  Royalty, license and service fee payments to non-residents.
    withholding taxes are required for companies and they must declare them through their withholding tax returns.

Dividends

Interest

Royalties And Fees

Withholding taxes on received payments of resident corporations:

  • Dividends are reqiured to 15%
  • The resident corporations taking interest on treasury bills and treasury bonds are subject to pay 0%
  • Interest on other bonds and bills derived by resident companies are required to 0%,
  • Bank deposits are subject to 10%-18% (for bank deposits opened after January 2, 2013).
  • Profit shares paid by participation banks in consideration of participation accounts are subject to 10%-18% (for participation accounts opened after January 2, 2013).
  • REPO agreements are subject to 15%.


Withholding taxes on received payments of non-resident corporations:

  • Dividends are subject to 15%.
  • Interest on treasury-bill and treasury bonds derived by non-resident corporations is subject to 0%.
  • Interest on other bonds and bills derived by non-resident corporations is subject to 0%,
    bank deposits are subject to 10%-18% (for bank deposits opened after January 2, 2013).
  • Profit shares paid by participation banks in consideration of participation accounts are subject to 10%-18% (for participation accounts opened after January 2, 2013).
  • REPO agreements are subject to 15%

Individual Income Taxe


2. Individual Income Tax

The personal income tax rate varies from 15% to 35%.

Income tax rates applicable to yearly gross earnings from 2013 are as follows:

Income Scales (TL)Rate %
Up to 10,70015 %
10,701-26,00020 %
26,001-60,00027 %
60,001 and over35 %

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