Total Employer Costs

GROSS SALARY:

The gross salary is the amount of salary earned by an employee according to Turkish Labor Law.

• Gross Salary = Net Salary + Total Deductions

Deductions include:

• • Social Security Premium (Employee Share): 14%

  • Unemployment Insurance (Employee Share): 1%

  • Income Tax: Starts at 15%, increases progressively

  • Stamp Tax: 0.759%

NET SALARY:

The net salary is the amount of salary actually received by employees.

• Net Salary = Gross Salary – Total Deductions

EMPLOYER’S COST:

In addition to the gross salary, the employer is required to pay the employer’s portion of social security and unemployment insurance contributions.

Employer Contributions:

• Social Security (Employer Share)(*): 25,5%

• Unemployment Insurance (Employer Share): 2%

Total: 22,5%

Total Cost to Employer = Gross Salary + (27,5% of Gross Salary)

SAMPLE CALCULATION:

Assume the gross salary is TRY 50.000.

➤ 1. Employee Deductions:

• Social Security (14%): 50.000 × 14% = 7.000 TRY
• Unemployment Insurance (1%): 50.000 × 1% = 500 TRY
• Income Tax (15% rate): ≈ 6.375 TRY
• Stamp Tax (0,759%): 50.000 × 0,00759 ≈ 380 TRY

Total Deductions ≈ 14.255 TRY

Net Salary ≈ 50.000 – 14.255 = 35.745 TRY

➤ 2. Employer’s Cost:

• Social Security (25.5%): 50.000 × 20.5% = 12.750 TRY
• Unemployment Insurance (2%): 50.000 × 2% = 1.000 TRY

Total Employer Contributions = 13.750 TRY

Total Cost to Employer = 50.000 + 13.750 = 63.750 TRY

(*) About the Employer Social Security Premium Discount

In Türkiye, employers who meet certain conditions, such as submitting declarations on time, having no unpaid debts to the Social Security Institution (SGK), and being compliant with employment regulations, can benefit from a 5-point discount on the employer’s social security premium.

• If eligible, the social security contribution rate is reduced from 25,5% to 20,5%.
• If not eligible, the full rate of 25,5% applies.

A legislative change is currently under discussion to reduce this discount to 4 points for general private-sector employers. However, employers in the manufacturing sector will continue to benefit from the full 5-point discount during 2025 and 2026.