Turkey

In Turkey, companies (other than those in the financial sector) are subject to a standard CIT rate of 25%. For financial sector companies, the CIT rate is 30%.

The taxable income of a company is computed based on its net accounting profits after adjustment for exemptions and deductions and including prior-year losses carried forward, to a limited extent.

Resident entities are subject to tax on their worldwide income, whereas non-resident entities are taxed only on their Turkish-sourced income. 

Minimum CIT rule

With effect from 1 January 2025, a domestic minimum tax regime is applicable that aims to ensure the corporate tax is not less than 10% of corporate income before certain exemptions and deductions. Under the new rule, the corporate taxpayers will compute their tax liability under both the standard tax regime (i.e. 25% tax on taxable income after deductions and exemptions) and a parallel regime (i.e. 10% tax on taxable income before certain deductions and exemptions). The larger amount will then be payable. 

Certain exemption items are excluded from the base for the 10% tax (In other words, these specific exemptions will not be added to the base for the 10% tax). These exemptions include:

• Participation exemption for dividends from Turkish resident entities
• Exemption for emission premiums
• Exemption provided under the Law on Technology Development Zone
• Allowances granted for qualifying R&D and design activities

Local income taxes

There are no provincial or municipal taxes on corporate income in Turkey.