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Corporate - Significant developments
Last reviewed - 27 March 2026Extension of Istanbul Finance Center incentives
The period for the corporate tax deduction applied at a rate of 100% on the profits of institutions engaged in financial activities by obtaining a participant certificate at the Istanbul Finance Center is extended until 31 December 2047.
In addition, the exemption period for financial activity fees that must be collected under the Fees Law from the headquarters and branches of financial institutions holding a participant certificate and located in Istanbul Finance Center is also increased from 5 years to 20 years.
Deduction for transit trade and intermediary activities relating to international trade
As a result of the amendment made to Article 10 of the Corporate Tax Law, 95% of the earnings derived from the sale abroad of goods purchased from abroad without being brought into Türkiye, or from intermediation in the purchase and sale of goods occurring abroad, may be deducted from the corporate tax base. This rate will be applied as 100% for companies operating in the Istanbul Finance Center or in designated industrial zones.
In order to benefit from the deduction, the income must be transferred to Türkiye by the date which the corporate tax return on which the corporate tax return for the relevant accounting period is required to be filed. In respect of intermediation activities, it will also be required that neither the seller nor the buyer of the goods is located in Türkiye.
Introduction of Qualified Service Center regime
A new Qualified Service Center (QSC) regime has been introduced, aimed to encourage multinational corporate groups to conduct their regional management, coordination, support and expertise functions in Türkiye.
A QSC is defined as a capital company established to provide certain eligible services to related group companies or a group companies actively operating in at least three different countries and deriving at least 80% of its annual revenue from related parties abroad.
The qualified service center regime is supported by the following tax advantages:
- Corporate tax: 95% of income derived exclusively from abroad within the scope of qualified service center activities may be excluded from corporate tax base. This rate increases to 100% if the QSC is operating within the Istanbul Finance Center or in certain designated industrial zones. In order to benefit from this exclusion, the income must be transferred to Türkiye by the date on which the corporate tax return is required to be filed. The exclusion from corporate tax base is available for 20 fiscal years.
- Income tax: The portion of the salaries of qualified service personnel employed by a qualified service center that does not exceed three times the gross minimum wage is exempt from income tax. The exemption cap is increased to five times the gross minimum wage, if the QSC is operating in the Istanbul Finance Center or in designated industrial zones.
Reduced corporate tax rate for manufacturing and agricultural activities
The corporate income tax rate has been reduced to 12.5% for income derived exclusively from manufacturing activities by companies holding an industrial registry certificate, as well as for income derived from agricultural production activities. This reduced corporate tax rate will apply to earnings generated starting from the year 2027.
New asset amnesty regime introduced
Law No. 7582 on the Amendment of Certain Laws published in the Official Gazette dated June 2026 introduces a new asset amnesty regime. Money, gold, foreign currency, securities and other capital market instruments located abroad, as well as assets of the same nature located in Türkiye but not recorded in statutory books may be notified to banks and intermediary institutions in Türkiye until 31 July 2027.
Assets located abroad must be brought to Türkiye or deposited into bank or intermediary institution accounts in Türkiye within two months from the date of notification.
The applicable tax rate is generally 5%, which may be reduced to between 0% and 4% depending on the commitment to hold the declared assets in specified financial instruments for a minimum period ranging from one to five years.
The regulation also provides that, if the conditions are met, no tax audit or tax assessment will be conducted in respect of the amounts corresponding to the notified assets.
Withholding tax (WHT) rate on dividends increased
The WHT rate applicable on dividend payments was increased to 15% in December 2024 and remains applicable. Accordingly, any dividends paid to a resident or non-resident individual, or a non-resident company, on or after 22 December 2024 will be subject to 15% WHT, unless the rate is reduced under a tax treaty. No WHT is imposed on dividends paid to a resident company, so the recent amendment does not have impact on profit distributions from a resident company to another resident company.
The law implementing Pillar Two rules has been implemented and applies starting from 2024/2025
The law number 7524 introducing implementation of the Pillar Two rules appeared in the Official Gazette of 2 August 2024. Similar to the Organisation for Economic Co-operation and Development (OECD) Model Rules and the Pillar Two Directive, the Turkish Pillar Two legislation will apply to constituent entities that are members of a multinational enterprise (MNE) group that has annual revenue of Turkish equivalent of 750 million euros (EUR) or more in the consolidated financial statements of the ultimate parent company in at least two of the four fiscal years immediately preceding the tested fiscal year.
In general, the Turkish Pillar Two provisions do not differ significantly from the European Union (EU) Minimum Tax Directive. Very briefly, the Turkish Pillar Two regulations introduce the global minimum top-up taxation rules by providing for the main interlocking measures, i.e. the Income Inclusion Rule (IIR) and the Undertaxed Payment Rule (UTPR) as well as a Qualifying Domestic Minimum Top-Up Tax (QDMTT) under the safe-harbour OECD standards. The new rules are effective for fiscal years starting from 1 January 2024, except for the UTPR provisions, which apply to fiscal years starting from 1 January 2025. Implementation guidance has also been further clarified during 2025 and 2026.
Implementation of a domestic minimum corporate tax regime
Law No. 7524, published in the Official Gazette on 2 August 2024, introduced a domestic minimum corporate tax regime to ensure that corporate income tax is not less than 10% of corporate income calculated before certain exemptions and deductions. Under this regime, corporate taxpayers are required to compute their tax liability under both the standard corporate tax system and a parallel minimum tax system, and to pay the higher amount. The domestic minimum tax regime applies to fiscal years starting from 1 January 2025 and subsequent periods.
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