What is Muhasebe?

Muhasebe (accounting) in Turkey operates within a strict statutory framework that combines tax-aligned chart-of-accounts requirements with professional licensing rules. Understanding this framework is essential for any business operating in Turkey.\n\n**Tek Duzen Hesap Plani (Uniform Chart of Accounts)**\nAll commercial enterprises are required to use the Tek Duzen Hesap Plani (TDHP), the national chart of accounts prescribed by the Accounting System Implementation General Communique No. 1 issued in 1992 and updated subsequently. The TDHP is a five-tier hierarchical system:\n- 0: Capital and fixed assets\n- 1: Current assets\n- 2: Non-current assets\n- 3: Short-term liabilities\n- 4: Long-term liabilities\n- 5: Equity\n- 6: Revenue\n- 7: Cost of goods sold\n- 8: Other income/expenses\n\nCompanies subject to Bagimsiz Denetim use TMS/TFRS (Turkish Accounting Standards, equivalent to IFRS) instead of TDHP, but the chart of accounts structure remains largely compatible.\n\n**Accrual basis requirement**\nAll accounts must be maintained on an accrual basis (tahakkuk esasi). Cash-basis accounting is not permitted for registered commercial businesses. Revenue is recognised when earned, and expenses when incurred, regardless of cash movement.\n\n**Record retention**\nBusiness records, accounting books (defter-i kebir, yevmiye defteri), and supporting documentation must be retained for 5 years under VUK. For companies subject to customs declarations or social security records, longer retention may apply. E-Fatura and e-Arsiv records are retained in the GIB system and can be retrieved from there.\n\n**Licensed accountants (SMMM and YMM)**\nTurkey has a two-tier professional accounting licensing system:\n- SMMM (Serbest Muhasebeci Mali Musavir): Certified Public Accountant — authorised to handle accounting, tax returns, and advisory for businesses below certain thresholds\n- YMM (Yeminli Mali Musavir): Sworn Financial Adviser — higher-level qualification authorised to certify certain tax refund claims and provide attestation services; cannot also act as bookkeeper for the same client\n\nMost annual tax returns (Kurumlar Vergisi, Gelir Vergisi) must be signed by a licensed SMMM or YMM. This means even a sole-director Limited Sirketi must engage an external accountant.\n\n**Electronic accounting records**\nTurkey has progressively mandated electronic records. E-Defter (electronic accounting books — the general ledger and journal in electronic format) is mandatory for companies subject to e-Fatura. All electronic records are timestamped and logged with the Revenue Administration, providing the tax authority with near-real-time visibility of accounting data.