Turkey Corporate Tax - Guide for International Expansion

Are you considering expanding your business to Turkey? Understanding the country's corporate tax system is essential for making informed decisions about your international operations.

Turkey offers a strategic location bridging Europe and Asia, making it an attractive destination for businesses looking to access both markets. However, navigating the corporate tax landscape requires careful planning and compliance with local regulations. Whether you're exploring new market opportunities or planning a business expansion, understanding your tax obligations is crucial for success.

If you're looking for efficient ways to manage international payments and handle cross-border transactions, Wise Business can help streamline your financial operations in Turkey and beyond.

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This publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Wise Payments Limited, its subsidiaries or affiliates, and it is not intended as a substitute for obtaining business advice from a tax advisor or any other professional.

Turkey corporate tax rate in 2025

The standard corporate income tax rate in Turkey is 25% for the 2025 tax year. This rate applies to the worldwide income of Turkish resident companies and to Turkish-source income of non-resident companies.¹

Turkey also operates a withholding tax system for certain types of income. Non-resident companies are subject to withholding tax rates that vary depending on the type of income and applicable double taxation treaties. For example, dividend payments to non-residents are generally subject to a 15% withholding tax, though this may be reduced under treaty provisions.²

Additionally, Turkey has specific provisions for certain sectors and company types. Small and medium-sized enterprises may benefit from reduced rates under certain conditions, and there are special regimes for companies operating in technology development zones and free zones.³

Companies are considered Turkish tax residents if they are incorporated in Turkey or if their place of effective management is in Turkey. Non-resident companies are only taxed on their Turkish-source income.⁴

Read more about Corporate Tax Planning best practices

How to pay corporate tax in Turkey

Corporate tax payments in Turkey are administered by the Revenue Administration (Gelir İdaresi Başkanlığı), which operates under the Ministry of Treasury and Finance. Companies must file their corporate tax returns and make payments through the electronic tax system called "İnteraktif Vergi Dairesi" (Interactive Tax Office).⁵

Corporate taxes in Turkey are paid in Turkish Lira (TRY). Foreign companies operating in Turkey must convert their functional currency to Turkish Lira for tax calculation and payment purposes. Exchange rate fluctuations are recognised for tax purposes based on the Central Bank of Turkey's official rates.

Turkish companies are required to file their annual corporate tax return by the end of April following the tax year (which runs from 1 January to 31 December). The corporate tax liability must be paid in full by the filing deadline. Companies may also be required to make quarterly provisional tax payments throughout the year.⁶

Late payment of corporate tax incurs interest charges calculated daily. The interest rate is determined by the Ministry of Treasury and Finance and is typically around 4.5% per month.⁷

Let's calculate the annual tax due for a company with a turnover of 1.5 million TRY and a profit margin of 10%, resulting in a taxable profit of 150,000 TRY.

At Turkey's standard corporate tax rate of 25%, the tax owed would be:

150,000 TRY × 25% = 37,500 TRY

If this company were to pay its tax 30 days late, assuming a monthly interest rate of 4.5%, the interest charge would be approximately:

37,500 TRY × 4.5% = 1,687.50 TRY for the month

So the total amount owed would be: 37,500 TRY (tax) + 1,687.50 TRY (interest) = 39,187.50 TRY

For businesses expanding into Turkey, having the right financial infrastructure is crucial. Wise Business provides an excellent solution for international companies operating in Turkey, offering local TRY accounts that make it easy to pay corporate taxes, handle supplier payments, and receive customer payments in local currency without high conversion fees.

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Tax Compliance in Turkey

A few steps to keep your company fully compliant with Turkish tax regulations:⁸

• Register for Taxes: When you incorporate via MERSİS and the Trade Registry, your company details are automatically forwarded to the Revenue Administration (GİB). Register early to avoid penalties. Businesses must pay Corporate Income Tax (CIT), VAT, payroll, and withholding taxes.
• Corporate Tax Filing: Corporate tax in Turkey is regulated under Law No. 5520 and overseen by the GİB. Returns must include audited financial statements and profit–loss reports. Corporate tax returns are filed annually, with the submission deadline 30 days after the end of the fourth month of the fiscal year. Payments can be made electronically via corporate tax online portals, at GİB-affiliated banks, or through wire transfer for non-residents. Missing deadlines results in surcharges while missing or unnotarized records may incur fines up to a day’s revenue.
• Accounting and Record-Keeping: Statutory books (journal, ledger, inventory) must be maintained in Turkish and approved by the Trade Registry. Financial statements may need to follow Turkish Financial Reporting Standards (TFRS) depending on company size. Proper record-keeping supports compliance and is key to securing any corporate tax refund or claiming corporate tax credits.

International Expansion to Turkey

Turkey stands out as a bridge between continents. Its geographic advantage and dynamic economy make it a prime destination for global expansion.

Positioned at the crossroads of Europe, Asia, and Africa, the country provides access to 1.3 billion consumers and a combined market GDP exceeding USD 28 trillion, all within a four-hour flight. Turkish Airlines enhances this reach with connections to 342 destinations in 121 countries, positioning Turkey as a strategic hub for global operations.⁹

Over time, the Turkish economy has demonstrated consistent growth, ranking as the 12th largest in the world in terms of GDP (PPP). It recorded a GDP of USD 1.32 trillion in 2024 and remains among the fastest-growing economies in the G20. A young and dynamic population of 85.7 million, half of whom are under the age of 34, provides both a large labour pool and a robust consumer base. Around 960,000 graduates enter the workforce annually, contributing to a skilled and competitive talent market.¹⁰

Multinational companies increasingly view Turkey as an ideal manufacturing, export, and regional management base. The country’s liberal investment climate is supported by bilateral investment treaties with 86 nations and social security agreements with 34 countries, easing cross-border operations for expatriates.¹

For businesses considering expansion, evaluating Turkey’s corporate tax rate, currently set at 25%, and broader market opportunities is essential. Many companies consider professional guidance to ensure compliance and optimize efficiency. Understanding the tax framework is vital for long-term success, directly impacting budgeting, investment, and staffing strategies. Turkey’s growing financial and advisory sector also presents opportunities for professionals in related roles.

You can establish a business in Turkey by following the steps below:¹²

1. Conduct detailed market research.
2. Prepare a business plan with forecasts and budgets.
3. Choose a legal structure and obtain a tax number.
4. Register the company with the Trade Registry through the MERSIS system.
5. Open a business bank account and hire an accountant to stay compliant.

Once you’ve covered the core elements of setting up a business in Turkey, you can look into other aspects, such as the best payment methods and how to scale your company in this region. It’s essential to stay aware of the current policies and market demands to ensure sustainable profits.

Discover the top 5 best Corporate Tax softwares

Incorporation of Business in Turkey

To incorporate a business in Turkey, companies must follow the process outlined by the Turkish Trade Registry. Applications are handled through the online system known as MERSIS, where businesses submit their details and supporting documents. The main steps include:¹³

• Securing a unique business name through MERSIS.
• Obtaining a Turkish tax identification number.
• Choosing the appropriate legal structure (e.g., Joint Stock Company or Limited Liability Company).
• Providing a registered office address in Turkey.
• Opening a corporate bank account for capital deposit and transactions.
• Submit the required incorporation documents to the Trade Registry.

Hiring a local accountant is strongly recommended. They assist with bookkeeping, preparing financial statements, and ensuring the timely filing of corporate tax returns. Missing deadlines for corporate tax submissions may result in penalties, so careful compliance is integral.

Business Entities in Turkey

According to the Turkish Commercial Code, the following are some business types in Turkey:^{13 14}

• Joint Stock Company (A.Ş.): This type of company requires a minimum of one shareholder and TRY 50,000 in share capital. It is suitable for medium—to large businesses, allows share transfer, and is often used by companies planning to expand or list publicly.
• Limited Liability Company (Ltd. Şti.): Requires at least one shareholder and TRY 10,000 in capital. This is the most common entity, offering flexibility to small- to medium-sized enterprises.
• Branch Office: Allows a foreign parent company to operate in Turkey without creating a separate legal entity. Activities are restricted to those of the parent company.
• Liaison Office: This office cannot conduct commercial activities but can handle representation, market research, and coordination for the parent company.

Although some countries with no corporate tax attract attention, Turkey’s location, market size, and workforce often outweigh higher tax obligations.

International corporate tax best practices

Managing corporate tax obligations across multiple jurisdictions requires strategic planning and adherence to international standards. Here are key practices for businesses operating internationally.

Stay compliant with local and international tax laws by ensuring proper registration in every country where your business operates. File all required tax returns on time to avoid penalties and maintain up-to-date knowledge of local tax regulations. Understanding OECD frameworks like Base Erosion and Profit Shifting (BEPS) and the Pillar Two Global Minimum Tax helps ensure transparency and prevents tax avoidance risks.

Leverage double taxation treaties (DTTs) to avoid being taxed twice on the same income. Turkey has signed double taxation agreements with over 85 countries, which can significantly reduce withholding tax rates and provide relief from double taxation. Understanding these treaties and how they apply to your business structure is essential for optimising your tax position.

Maintain comprehensive and transparent financial records to ensure accurate tax return preparation and reduce the risk of errors that could lead to penalties. Well-organised financial records also simplify audit processes and demonstrate compliance with local regulations. Consider implementing robust transfer pricing documentation to support intercompany transactions and comply with OECD guidelines.

Take the complexity out of international expansion with Wise Business

Researching corporate tax is a crucial step when expanding your business into a new country. The next step is setting up the financial infrastructure to handle the complexities of operating across borders, from managing multi-currency cash flow to mitigating FX risk.

The Wise Business account provides the financial tools to make your international expansion to Turkey efficient and simple. It's the one account for managing your money globally.

With a Wise Business account, you can:

• Pay suppliers and initial fees: Pay suppliers, global payroll, and one-off incorporation costs in the local currency.

• Get paid like a local: Use local account details for 8+ major currencies to easily receive payments from customers or investors.

• Manage your money across borders: Hold and exchange 40+ currencies in one account, always with the mid-market exchange rate and low, transparent fees.

• Streamline your accounting: Integrate with tools like Xero or QuickBooks to simplify tracking your company's international finances.

• Empower your team: Provide multi-user access for your finance team and issue expense cards for international spending.

Wise is designed to support every step of your journey, from paying your first registration fee to receiving international payments and managing your global treasury.

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FAQs - Corporate tax in Turkey

Who is liable for corporate tax in Turkey?

Turkish resident companies are liable for corporate tax on their worldwide income, while non-resident companies are only taxed on Turkish-source income. A company is considered a Turkish tax resident if it's incorporated in Turkey or if its place of effective management is located in Turkey.

Are there any tax incentives for businesses in Turkey?

Yes, Turkey offers various tax incentives including reduced corporate tax rates for companies in technology development zones, free zones, and industrial zones. Research and development activities may qualify for super deductions, and certain investments may benefit from investment incentive schemes.

What is the tax treatment of dividends in Turkey?

Dividends paid by Turkish companies to non-resident shareholders are subject to 15% withholding tax, though this rate may be reduced under applicable double taxation treaties. Dividends received by Turkish companies from other Turkish companies are generally exempt from corporate tax.

What is the process for registering for corporate tax in Turkey?

Companies must register with the tax authorities within 30 days of incorporation or commencing business activities in Turkey. Registration involves obtaining a tax identification number and registering with the relevant tax office. Foreign companies establishing a permanent establishment must also complete this registration process.

What are the common pitfalls to avoid regarding corporate tax in Turkey?

Common pitfalls include failing to maintain proper transfer pricing documentation, not complying with quarterly provisional tax payment requirements, inadequate record-keeping in Turkish Lira, and misunderstanding the scope of Turkish tax residency. Additionally, businesses should be careful about withholding tax obligations on payments to non-residents.

Sources used in this article:

1. PwC Tax Summaries: Turkey Corporate Income Taxes
2. PwC Tax Summaries: Turkey Withholding Taxes
3. PwC Tax Summaries: Turkey Tax Credits and Incentives
4. PwC Tax Summaries: Turkey Corporate Residence
5. Turkish Revenue Administration (GİB)
6. PwC Tax Summaries: Turkey Tax Administration
7. Croneri: Turkey Corporate Tax Overview
8. Commenda: Turkey Corporate Tax Rates
9. Invest in Turkey: Strategic Location
10. Invest in Turkey: Why Invest in Türkiye (PDF)
11. Invest in Turkey: Liberal Investment Climate
12. Akkas Law: How to Open a Business in Turkey
13. Invest in Turkey: Establishing a Business Guide
14. Ministry of Trade: Investment Guide to Turkey (PDF)

Sources last checked 12/09/2025