This page collects the tax rates in Turkey applying for 2026 — corporate, income, VAT, withholding, payroll and property — together with the monetary thresholds that go with them. Two points decide most calculations and are missed most often: the domestic minimum corporate tax sets a floor that incentive-driven reductions cannot go below, and there are two income tax tariffs — the one for employment income is not the one that applies to rental or business income.
Corporate Tax Rates in Turkey
| Item | Rate |
|---|---|
| Standard rate | 25% |
| Banks, financial leasing, factoring, financing and savings finance companies, electronic payment institutions, capital markets institutions, insurance and reinsurance companies and pension companies | 30% |
| Reduction on export income | 5 points |
| Reduction on production income, for holders of an industrial registry certificate | 1 point |
| Domestic minimum corporate tax | 10% |
| Withholding on dividends distributed to resident and non-resident shareholders | 15% |
| Withholding on branch profits remitted to head office abroad | 15% |
Resident companies are taxed on worldwide income; non-resident companies on Turkish-source income only. The corporate tax return is filed and the tax paid in the fourth month following the end of the accounting period, with quarterly advance tax paid during the year.
Corporate tax calculated for a period may not be less than 10% of corporate income determined before deductions and exemptions are applied. The rule was introduced in 2024 and is the single most consequential recent change to the corporate tax base.
Its practical effect is that reduced-rate corporate tax under an investment incentive certificate, the export and production reductions, and exemptions from other sources cannot together take the liability below that floor. A model that applies the reduced rate to the whole of the profit overstates the benefit, sometimes substantially. Newly established companies are outside the rule for three accounting periods.
Income Tax Rates in Turkey
Two tariffs apply and they differ in the third bracket. Using the employment tariff for rental or business income understates the liability.
Employment income
- Up to TRY 190,000
- 15%
- To TRY 400,000
- 20%
- To TRY 1,500,000
- 27%
- To TRY 5,300,000
- 35%
- Above TRY 5,300,000
- 40%
Other income
- Up to TRY 190,000
- 15%
- To TRY 400,000
- 20%
- To TRY 1,000,000
- 27%
- To TRY 5,300,000
- 35%
- Above TRY 5,300,000
- 40%
Residents are taxed on worldwide income; non-residents on Turkish-source income only. Residence turns on having a domicile in Turkey or staying continuously for more than six months in a calendar year. Tax on employment income is applied to the cumulative base built up since January rather than to each month separately, so net pay falls as the year progresses.
VAT Rates in Turkey
| Rate | Applies to |
|---|---|
| 20% | The standard rate; all supplies of goods and services not listed elsewhere |
| 10% | Foodstuffs, textiles and clothing, pharmaceuticals and medical products, accommodation and other supplies in the relevant list |
| 1% | Basic foodstuffs, newspapers and magazines, listed agricultural products and defined housing deliveries |
Exports of goods and services, international transport and defined supplies are exempt with credit, meaning input tax remains recoverable. Other exemptions are without credit, in which case the input tax is not deductible and becomes a cost. Returns are filed monthly.
Withholding Tax Rates in Turkey
| Payment | Rate | Note |
|---|---|---|
| Dividends | 15% | Treaty relief may reduce the rate for non-residents |
| Branch profits remitted abroad | 15% | Treaty relief may apply |
| Royalties and similar payments to non-residents | 20% | Frequently reduced by treaty |
| Professional and consultancy fees to non-residents | 20% | Depends on the nature of the service and the treaty |
| Interest on loans from foreign banks and financial institutions | 0% | The status of the lender is decisive |
| Interest on loans from other non-residents | 10% | Including group companies that are not financial institutions |
| Rent paid to non-residents | 20% | Treaty relief may apply |
| Rent paid by businesses to resident individuals | 20% | On the gross rent |
| Professional service payments to resident individuals | 20% | Self-employment income |
| Progress payments on multi-year construction work | 5% | Different rates apply to defined works |
| Employment income | 15% – 40% | Under the employment tariff, on the cumulative base |
Interest paid to a foreign bank or financial institution is not subject to withholding. Interest on the same loan from a group company that is not a financial institution is subject to withholding at 10%.
Intra-group funding arrangements are therefore priced differently depending on who lends, and the transfer pricing and thin capitalisation rules apply alongside the withholding question rather than instead of it.
Payroll Rates and Thresholds in Turkey
| Item | Amount (TRY) |
|---|---|
| Gross minimum wage, monthly | 33,030.00 |
| Net minimum wage, monthly | 28,075.50 |
| Gross minimum wage, daily | 1,101.00 |
| Earnings subject to premium, daily upper limit | 9,909.00 |
| Earnings subject to premium, monthly upper limit | 297,270.00 |
| Severance ceiling, 1 January – 30 June 2026 | 64,948.77 |
| Severance ceiling, 1 July – 31 December 2026 | 73,729.87 |
| Social security branch | Employer | Employee | Total |
|---|---|---|---|
| Invalidity, old age and death | 11.00% | 9.00% | 20.00% |
| Short-term branches | 2.25% | — | 2.25% |
| Universal health insurance | 7.50% | 5.00% | 12.50% |
| Unemployment insurance | 2.00% | 1.00% | 3.00% |
| Total | 22.75% | 15.00% | 37.75% |
| Employer share with the five point reduction | 17.75% | — | 32.75% |
The reduction is five percentage points, not five per cent. The employer share moves from 22.75% to 17.75%. Entitlement depends on conditions including having no overdue premium debt; where a debt arises the reduction does not apply for that period.
The severance ceiling changes twice a year. It is updated in January and July, and the figure applying at the date of termination is the one used. Provisions calculated on a single annual figure understate the liability in the second half of the year.
Exempt benefits
| Benefit | Daily amount (TRY) | Note |
|---|---|---|
| Meals provided at the workplace | No limit | Exempt without a monetary cap |
| Meal allowance | 158.00 | For each day worked |
| Meal card or voucher | 300.00 | Excluding VAT |
| Transport | 126.00 | Only where provided as a public transport card or ticket; a cash allowance is treated as salary |
Property Tax in Turkey
| Property | Standard municipality | Metropolitan municipality |
|---|---|---|
| Residential | 0.1% | 0.2% |
| Commercial | 0.2% | 0.4% |
| Land with development rights | 0.3% | 0.6% |
| Agricultural land | 0.1% | 0.2% |
The tax is calculated on the value determined by the municipality rather than the purchase price, and is payable in two instalments each year. A separate title deed fee applies on transfer, charged to each of the buyer and the seller.
Stamp Duty and Special Consumption Tax in Turkey
| Item | Rate |
|---|---|
| Contracts containing a monetary amount | 0.948% |
| Wage payments | 0.759% |
| Rental agreements | 0.189% |
| Annual cap per document | Revalued each year |
Stamp duty is charged on the highest amount stated in a document, and where more than one original is signed each copy is liable. An annual upper limit applies per document. Certain documents attract a fixed amount rather than a proportional rate.
Special consumption tax applies to defined categories of goods — motor vehicles, fuel, tobacco, alcoholic beverages and certain other products — and is assessed before VAT. Rates are product-specific and are set as ad valorem percentages, fixed amounts per unit, or a combination, so the burden has to be established from the classification of the particular product.
Common Mistakes
- Modelling incentives without the domestic minimum tax. Reduced-rate corporate tax cannot take the liability below 10% of pre-exemption income.
- Applying the employment tariff to rental or business income. The third bracket ends at TRY 1,000,000 rather than TRY 1,500,000 for other income.
- Using one severance ceiling for the year. It changes in January and July; the figure at the termination date applies.
- Reading the five point reduction as five per cent. The employer share moves from 22.75% to 17.75%.
- Assuming interest to a non-resident always attracts 10%. Interest to a foreign bank or financial institution is not withheld.
- Treating a cash transport allowance as exempt. The exemption covers a public transport card or ticket only.
- Applying the standard corporate rate to a financial institution. Banks and the listed financial sectors are taxed at 30%.
- Overlooking that each signed original attracts stamp duty. Signing two originals doubles the charge up to the annual cap.
Frequently Asked Questions
What is the corporate tax rate in Turkey for 2026?
What is the domestic minimum corporate tax?
What are the income tax brackets in Turkey?
What are the VAT rates in Turkey?
What withholding applies to dividends paid abroad?
What withholding applies to interest paid to a non-resident?
What is the severance ceiling in 2026?
What are the social security contribution rates?
As the Ozbek CPA team, we apply these rates in practice — running payroll on current parameters, modelling corporate tax against the minimum tax floor before an incentive application is made, setting withholding correctly on cross-border payments and treaty positions, and updating severance and leave provisions when the ceilings change. See also our pages on the Turkish taxation system, VAT, payroll services and double taxation agreements. Contact us.
