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Sude Naz Ayaksız

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Turkey is one of the major investment hubs for foreign investors thanks to its strategic location, developed production infrastructure, and domestic market.

For companies wishing to operate in Türkiye, a proper understanding of the tax system is of great importance for the sound planning of investment processes. The Turkish tax system has a comprehensive structure consisting of direct taxes, indirect taxes, and transaction-based obligations.

In this article, the main types of taxes applicable to companies operating in Türkiye, together with the declaration and payment procedures, are discussed in general terms.

1. Corporate Tax System for Companies in Türkiye

Corporate tax is the main type of tax paid on the profits earned by companies at the end of an accounting period (Corporate Tax Law No. 5520 art. 1).
The corporate income taken as the basis for corporate tax refers to the net profit earned by companies at the end of an accounting period (CTL art. 6).
In the payment of corporate tax, a distinction is made between full taxpayers and limited taxpayers (CTL art. 3).
a. Full Taxpayer Corporation: Corporations whose legal or business headquarters are located in Türkiye are considered full taxpayers. These corporations are obliged to pay corporate tax both on the income derived from their activities in Türkiye and on the income derived from their activities abroad (CTL art. 3/1).

b. Limited Taxpayer Corporation: Corporations whose legal or business headquarters are not located in Türkiye are considered limited taxpayers. These corporations are only obliged to pay corporate tax on the income derived from their activities within the borders of Türkiye (CTL art. 3/2).

Rates Applied to Annual Corporate Income (CTL art. 32)

As a rule, corporate tax is levied at the rate of 25% on the annual income earned by corporations.
However, this rate is applied as 30% for certain institutions. These institutions are:
Banks,
Companies within the scope of Law No. 6361,
Electronic payment and money institutions,
Authorized foreign exchange institutions,
Asset management companies,
Capital market institutions,
Insurance and reinsurance companies,
Pension companies,
Companies operating as parties to contracts within projects carried out under the build-operate-transfer model pursuant to Law No. 3996, applicable to income earned in the 2025 and subsequent taxation periods,
Companies operating as parties to contracts within projects carried out under the public-private partnership model pursuant to Law No. 6428, applicable to income earned in the 2025 and subsequent taxation periods.

Corporate Tax Declaration and Payment Period

The corporate tax return is prepared for the previous calendar year, and taxpayers are required to submit this return between April 1 and April 30 each year (CTL 14).
For example, in 2026, the corporate tax return for the year 2025 is prepared and submitted between April 1, 2026 and April 30, 2026.
The period determined for the payment of corporate tax is the same as the period determined for the submission of the return (CTL art. 21).
2. General Structure of the Turkish Value Added Tax System

Value added tax is a type of tax based on the taxation of the value added at each stage from the production of goods and services until they reach the consumer. Although it is collected by businesses, it is ultimately paid by consumers (Value Added Tax Law No. 3065 art. 1).
The Turkish VAT system is based on a deduction mechanism, and companies may offset the VAT they have paid within the scope of their activities under certain conditions (VATL art. 29).
Value Added Tax Rates

Although VAT rates vary depending on the type of product or service, they are generally determined at different rates such as 1%, 10%, and 20% (VATL art. 28).
20% VAT rate: Applied to products and services such as luxury consumer goods, electronics, furniture, and white goods (Presidential Decree on the Determination of Value Added Tax Rates).
10% VAT rate: Applied to basic consumer goods such as milk and dairy products, as well as services such as restaurant services and hotel accommodation (Presidential Decree on the Determination of Value Added Tax Rates).
1% VAT rate: Applied to basic food products such as bread, flour, legumes, and certain agricultural products (Presidential Decree on the Determination of Value Added Tax Rates).
Value Added Tax Declaration and Payment Period

VAT collected from consumers must be declared through a VAT return by the end of the 28th day of the month following the collection (VATL art. 41).
The period determined for the payment of VAT is the same as the period determined for the submission of the return.
3. Withholding Tax Obligations for Companies

Withholding tax refers to the deduction of tax at the rates prescribed under tax legislation. Withholding tax is a type of tax deducted at source during the generation of income subject to income tax and corporate tax and paid to the relevant tax office. Once the taxpayer makes the payment to the relevant tax office, the tax liability is deemed fulfilled.
Withholding Tax Rates

Withholding tax is applied at different rates. The reason for this is that the tax rates prescribed under tax legislation differ from one another.
Declaration and Payment of Withholding Tax

Withholding tax deductions are declared through tax returns.
Taxpayers subject to withholding tax may pay their tax liabilities at the end of the declaration period.
4. Provisional Tax (Advance Tax) Practice in Türkiye

Provisional tax is a type of tax that enables the advance collection of tax on income earned during quarterly periods, without waiting for income tax and corporate tax taxpayers to make a single annual tax payment. In summary, provisional tax is the tax paid quarterly on the income earned by businesses during the year (Income Tax Law No. 193 art. 120).
The provisional tax paid is offset against the income tax and corporate tax returns at year-end.
Provisional Tax Rates

Provisional tax rates vary as 15%, 25%, and 30%.
15% provisional tax rate: Applicable to income tax taxpayers such as sole proprietorships and self-employed professionals.
25% provisional tax rate: Applicable to corporate tax taxpayers such as limited liability companies and joint stock companies.
30% provisional tax rate: Applicable to banks and financial institutions.
Provisional Tax Declaration and Payment

Provisional tax returns are submitted in 3 periods according to the income earned during the year.
The first period covers January, February, and March, and the declaration may be submitted until the evening of May 17.
The second period covers April, May, and June, and the declaration may be submitted until the evening of August 17.
The third period covers July, August, and September, and the declaration may be submitted until the evening of November 17.
Provisional tax payments are made within the month in which the return is submitted.
5. Stamp Tax in the Turkish Tax System

Stamp tax is a type of tax levied on documents with legal and commercial validity (Stamp Tax Law No. 488 art. 1).
As a rule, the obligation to pay stamp tax belongs to the parties signing the document. The obligation to pay stamp tax arises upon the signing of the document or upon the document gaining legal validity.
Commercial contracts, lease agreements, payrolls and salary payments, declarations and official notifications, tender decisions and bid documents, and guarantee and security agreements may be given as examples of documents subject to stamp tax (Tablo No 1 annexed to the Stamp Tax Law No. 488).
Stamp Tax Amounts and Rates

Stamp tax is applied either proportionally or as a fixed amount depending on the nature of the document used (STL art. 10).
For example, in 2026, the stamp tax rate for commercial contracts is 9.48 per thousand, while the stamp tax amount for a corporate tax return is TRY 1,605.80.
In order to prevent the stamp tax levied on documents from exceeding the determined upper limit, a ceiling amount practice is applied in stamp tax. Accordingly, the maximum stamp tax amount for 2026 may be TRY 29,115,961.10.
Stamp Tax Declaration and Payment

The stamp tax return is submitted until the 23rd day of the month following the month in which the document is issued.
Stamp tax payment is made until the 26th day of the month in which the return is submitted (STL art. 22). However, in some transactions such as notarial procedures, stamp tax is collected in advance during the transaction.
6. Special Consumption Tax System in Türkiye

Special consumption tax is an indirect tax levied on products considered luxurious, harmful to health and the environment, or products with high added value (Special Consumption Tax Law No. 4760 art. 1).

Special Consumption Tax Return and Payment

The special consumption tax return is submitted within different periods depending on the list in which the goods are included (SCTL art. 14).
For goods listed in List (I), returns for deliveries made during the first 15 days of the month are submitted by the 25th day of the same month; returns for deliveries made during the second 15 days of the month are submitted by the 10th day of the following month.
For goods listed in List (II), the return is submitted before the vehicle registration and registration procedures are completed.
For goods listed in Lists (III) and (IV), the return must be submitted by the end of the 15th day of the month following the delivery date.
Special consumption tax is paid once when the product or good is purchased for the first time.
If tax obligations are not fulfilled within the prescribed periods, administrative fines, default interest, and tax loss penalties may arise (Tax Procedure Law No. 213 art. 344 et seq).

Türkiye’s developing investment ecosystem, strategic geographical location, and incentive mechanisms create significant opportunities for foreign investors. However, the regular monitoring of tax procedures, the timely submission of tax returns, and the proper fulfillment of obligations are of importance for companies both in maintaining financial order and in preventing administrative sanctions. Therefore, it is of great importance for companies to regularly monitor their tax obligations in order to manage their financial processes and avoid sanctions