Bradford Jacobs is a global leader in recruitment, payroll and taxation. For more than 20 years, we have ensured our clients comply with every aspect of taxation legislation wherever they operate worldwide. Our combination of local ‘know-how’ and global experience is vital for foreign companies moving into the Republic of Türkiye, and dealing with tax in Türkiye while overseas can be tricky and pose complications that would demand expert guidance.

The admin workload can weigh heavily on your business operations. Türkiye’s corporate tax regime is fluid, with rates above the standard 20% rate until 2023. Employers operating payroll must also comply with strict regulations regarding employees’ taxes and social security contributions.

Bradford Jacobs’ dedicated specialists take the burden off your shoulders while you focus on establishing your business in this exciting – but demanding – new territory. From locating the brightest talent to running your payroll, our Professional Employer Organisation (PEO) and Employer of Record (EOR) specialists are with you at every step.

Overview of Tax in Türkiye

Personal Income Tax (PIT):

There are five tax bands on employment income, starting at 15% on income up to TRY 32,000 (€6,085, US$6,195) with a top rate of 40% on the excess over TRY 880,000 (€167,360, US$170,380). Additionally, there are two bands for tax on non-employment income of 27% for earnings up to TRY 170,000 (€32,330, US$32,910) and 35% for the excess over that. There is no special tax regime for expats.

Social Insurance Taxes:

Employers generally contribute 20.5% of employees’ payroll and deduct 14% from employees’ earnings to remit to the Social Security Institution (SSI).

Corporate Income Tax:

The standard rate of 20% was increased to 25% for returns on earnings in 2021 and 23% for income generated in 2022 before returning to 20% for 2023, depending on legislation. The standard rate for the financial sector is 25%.

Indirect Taxes:

The standard Value Added Tax (VAT) rate of 18% is reduced to 8% for basic foodstuffs, publications (excluding online categories), pharmaceutical products, and 1% for some agricultural products and services. Digital Services Tax (DST) is 7.5% but can be reduced to 1% or increased to 15% on individual cases. Special Consumption Tax (SCT) applies various rates to petroleum, vehicles and luxury goods.

Withholding Tax (WHT):

Resident individuals pay 15% on dividends and 20% on royalties and fees for technical services. Non-resident companies and individuals pay 15% on dividends, up to 10% on interest payments and 20% on royalties and technical services fees.

Capital Gains Tax (CGT):

Capital gains are taxed as income.

Personal Income Tax in Türkiye

From Not Over Tax %
TRY 32,000 (EUR 6,085 - USD 6,195)
TRY 32,001
TRY 70,000 (EUR 13,312 - USD 13,550)
TRY 70,001
TRY 250,000 (EUR 47,545 - USD 48,400)
TRY 250,001
TRY 880,000 (EUR 167,360 - USD 170,380)
Over TRY 880,001

Additional Taxes for non-employment income:

From Not Over Tax %
TRY 70,000
TRY 170,000 (EUR 32,230 - USD 32,910)
TRY 170,001
TRY 880,000 (EUR 167,360 - USD 170,380)

Individual Tax Rules in Türkiye

  • The tax year is from January 1 until December 31.
  • Married couples are generally not permitted to file joint returns.
  • Employees’ tax is usually withheld and deducted at the source by the employer.
  • Apart from taxes deducted at source from the pay-as-you-earn payroll, individual tax returns are due by February 28 for trade income and by March 31 for all other cases.
  • Any tax due in addition to payroll deductions is paid in equal amounts, half at the time of filing and the balance within four months.
  • Taxable income includes bonuses and commission, plus benefits in kind with a value, such as cost of living and housing allowances.
  • Employment income liable for taxation is deducted in progressive rates from 15% to 40%.
  • Aside from payroll deductions, tax is also due on professional and business income, agriculture income, plus income from shares and property, for example.
  • Individuals are tax residents if they reside in Türkiye or intend to settle. If residency is unclear, individuals continuously in Türkiye for six months in a calendar year are considered residents. Residents are liable for the entire taxation liability.
  • Limited tax liability can apply to individuals who have no legal residence and do not reside in the country for more than six months. Limited liability also applies to those on temporary assignments which are in Türkiye for more than six months.

Employer's Social Insurance and Statutory Contributions in Türkiye

Employer’s contribution to the Social Security Institution (SSI) is generally 20.5% of payroll, although, in some circumstances, this can be reduced to 15.5% and is calculated based on employment categories.  Employers also contribute 2% to unemployment insurance.


For more information, download our free guide or get in touch with our consultants here