To promote private investment in education and healthcare, Turkey provides a corporate income tax exemption for profits earned from newly established schools, hospitals, rehabilitation centers, and similar facilities operated by private entities.
This incentive aims to enhance public service capacity, create employment, and encourage social investment in critical sectors.
Conditions for the Exemption
- Official Authorization:
The activity must be carried out with the approval of the Ministry of National Education or the Ministry of Health. - New Facility Investment:
The exemption applies only to newly constructed facilities.
Leasing or operating rights over existing public facilities are not eligible. - Duration:
The corporate tax exemption is valid for five fiscal years, starting from the year the facility begins operation. - Scope Limitation:
Only profits directly related to education or healthcare services are exempt.
Other commercial income earned by the entity is subject to standard taxation.
Application and Explanation
This regulation encourages private-sector engagement in socially beneficial fields.
Newly established schools, hospitals, and rehabilitation centers are exempt from corporate income tax for five years, starting from the first year of operation.
After the five-year exemption period, profits become taxable under normal conditions.
The exemption applies only during the actual service period in which education or healthcare activities are provided.
A company completes the construction of a private school and begins operations in 2025.
Profits earned from 2025 to 2029 are fully exempt from corporate income tax.
From 2030 onward, all income will be taxed according to standard corporate tax rules.
Legal Basis
This incentive is regulated under Article 5/1-ı of the Turkish Corporate Tax Law (No. 5520).
Its objective is to encourage private investments in education and healthcare, contributing to long-term social welfare and economic growth in Turkey.
For professional assistance with corporate tax exemptions, incentive planning, and compliance for education and healthcare investments in Turkey, contact ÖzbekCPA.
RELATED ARTICLES
- Technology Development Zone (TDZ) Tax Exemption in Turkey
- Cooperative Income Exemption in Turkey
- Participation Income Exemption in Turkey
