Accountancy in Turkey

>> Audit Requirements in Turkey

The following companies are required to have a statutory annual audit;

  • Companies Quoted to to the Istanbul Stocks Exhange Market (IMKB) or other companies considered publicly held
  • Companies exceeding two of the following conditions; Total assets exceeding TL 35.000.000,-
  • Total Net Turnover exceeding TL 70.000.000,-
  • Total Employees exceeding 175 people

Banks, factoring, leasing companies and other financial institutions, insurance companies and media companies, foundations, associations, oil, gas, electricity companies exceeding different limits.

The Corporate Income Tax Act Comprises as taxable entities the limited company (Ltd. Sti.), incorporated company (A.S.), a registered branch or a subsidiary of a foreign company. The corporate tax rate is % 20 ( % 22 for 2018-2019-2020 ). The advance tax is prepaid during the current year in four instalments on quarterly basis during the period and the final corporate tax return is filed and paid in April following the period. Tax losses can be carried forward up to 5 years.

The taxable base is the worldwide income for Turkish tax residents while the nonresidents are subject to tax only on their income derived in Turkey. A company is resident if its management and control is in Turkey.

The corporate tax is charged on a company’ s profits defined as income and taxable capital gains. In principle, all expenses are deductible if incurred in producing or maintaining business income including annual depreciation on operating equipment or buildings.

Dividends from a subsidiary are tax exempted without any limitations on share percentage. Choosing group taxation (losses of one company set off against profits of the other companies) is not allowable.

Dividend Payments

15% withholding tax is to be paid on distributions from a Turkish company. (Resident taxpayer). 15% withholding tax is to be paid (whether distributed or not) from a Turkish company (Non-resident taxpayer).

Branch Profits Tax

Turkish branches of foreign companies are subject to Turkish income tax under the Corporate Income Tax Act.

Personal Income Tax (Pay as you earn)

As a resident, an individual will be taxable on his or her worldwide income in the same manner as any person living in Turkey. On the other hand, a non-resident is generally only subject to Turkish taxation on income that is “sourced” in Turkey.

Capital Gains Tax

Capital gains are normally taxed as income. Capital gains on bonds and other financial claims or debts are taxable income. Losses in foreign currency are deductible. Losses in Turkish currency are deductible depending on the agreed interest rate. Capital gains on real estate are tax liable as well while losses can be set off exclusively against capital gains on other real estates.

If the gain exceeds approximately TL 34.000.-(2018) then is should be declared together with other securities and estate income.

Land Tax

Buildings within the territory of Turkey are subject to building tax. The building tax taxpayer is the owner of the building as its owner. There is a partial exemption of 25% of the tax value of buildings or apartments used as residences.

This partial exemption applies for five years from the following year when construction was completed.

The tax base for the building tax is the tax value of the building. The tax value is the value recorded at the Land Registry. The rate of tax is generally 0.2% although the rate falls to 0.1 % for buildings used as residences. These rates may be increased in a rate of 100 % within the frontiers of metropolitan municipality and contiguous regions as defined by law.

Value Added Tax (VAT)

VAT is a turnover tax that is levied at every stage of the sale and purchase of goods and services within Turkey. The general VAT rate is 18 % on the sales price, however reduced rates are applied fort he deliveries of some goods and services (1 % and 8 %)

Tax Treaties

There exist around 82 tax agreements, see appendix 1 for list of countries.


Latest version updated 8th April 2019

Country Breakdown





Turkish lira


$ 857.7