# Can I claim Banka Faizleri ve Finansman Giderleri (Bank Interest and Financing Costs) as a business expense in Turkey?

**Partially claimable.** Partially deductible. Interest on business loans from banks is generally deductible, but Turkey's thin capitalisation rules (Ortü Sermaye) restrict deductibility of interest on related-party loans where debt exceeds equity 3:1. A 10% additional restriction applies to total financial costs (including exchange losses) where they exceed 10% of pre-financing taxable profit under the Finansman Gider Kisitlamasi rule.

Typical amount: A TRY 5,000,000 bank loan at 45% annual interest: TRY 2,250,000 annual interest. If this exceeds 10% of pre-financing profit and falls under FGK: TRY 225,000 is non-deductible (10% disallowance). Net deductible: TRY 2,025,000.

## What GIB (Gelir Idaresi Baskanligi) says

Kurumlar Vergisi Kanunu Article 11/1-i (Ortü Sermaye, thin capitalisation, 3:1 debt/equity ratio for related-party loans). KVK Article 11/1-j (Finansman Gider Kısıtlaması, financial expense restriction, 10% disallowance where total financing costs > 10% of pre-tax, pre-financing profit). Bank loans from unrelated lenders at arm's length are not subject to thin-cap.

## When you can claim

- Interest on bank loans (Kredi Faizi) from Turkish or foreign banks at arm's length: fully deductible unless the FGK restriction applies
- Bank charges (Banka Masrafları), wire transfer fees, account maintenance fees
- Interest on leasing (Finansal Kiralama Faizi): deductible over the lease term
- Letters of credit and guarantee fees for commercial transactions
- Foreign currency loan interest, net of exchange gains/losses on the principal

## When you cannot claim

- Interest on related-party loans where total related-party debt exceeds 3x the company's equity (Ortü Sermaye): the excess interest is disallowed and reclassified as a deemed dividend
- Under the FGK rule: 10% of total financial expenses (interest + exchange losses + leasing finance charges) is non-deductible where those total costs exceed 10% of EBITDA-equivalent profit
- Interest on non-business borrowings (personal loans taken out by the owner-director and on-lent to the company without proper documentation)

## Good to know

**Pro tip:** The Finansman Gider Kısıtlaması (FGK) rule introduced in 2021 catches many companies by surprise, particularly in Turkey's high-inflation, high-interest-rate environment where bank loan rates often run at 30-50%. Model the FGK impact before year-end and consider early repayment if the disallowance is material. Related-party loans must always be documented at arm's length with a formal loan agreement and at market interest rates to avoid the Ortü Sermaye reclassification.

Source: https://www.gib.gov.tr/kurumlar-vergisi-kanunu-madde-11

## Related expenses

- [Mesleki Hizmet Giderleri (Professional Fees: Accountants, Lawyers)](https://accounts-os.com/tr/expenses/professional-fees-tr)
- [Isyeri Kirası (Office and Business Premises Rent)](https://accounts-os.com/tr/expenses/office-rent-tr)
- [Personel Ucretleri (Staff Salaries and Employer Costs)](https://accounts-os.com/tr/expenses/staff-salaries-tr)