What is the corporate tax rate in Turkey for 2025?

Turkey's corporate tax rate has changed several times in recent years, making it important to confirm the rate for each specific tax year.

Current rate: 25% (2025) For the tax year 2025 (1 January to 31 December 2025), the Kurumlar Vergisi rate is 25%. This applies to all capital companies — Limited Sirket (Ltd. Sti.) and Anonim Sirket (A.S.) — as well as cooperatives and other entities subject to corporate tax.

Rate history The corporate tax rate has been: - 20%: 2006 through 2020 - 25%: 2021 and 2022 (temporary increase) - 23%: 2023 - 25%: 2024 onwards

This volatility makes it essential to check the official GIB published rates each year rather than relying on memory or older sources.

How the tax is calculated Taxable profit is calculated by taking the commercial accounting profit (prepared under Turkish Accounting Standards) and making statutory adjustments: - Adding back non-deductible expenses (Kanunen Kabul Edilmeyen Giderler — KKEG): fines and penalties, entertainment above 0.5% of net sales, disallowed interest under thin-cap or FGK rules, personal expenses - Deducting qualifying items: investment incentive allowances, R&D super-deductions (150% for qualifying spend), prior year loss carry-forwards

The resulting taxable profit is multiplied by 25% to arrive at the Kurumlar Vergisi liability.

Gecici Vergi — quarterly advance payments Rather than paying the full annual corporate tax in April, companies make quarterly advance payments (Gecici Vergi) throughout the year at the same 25% rate. These are calculated on cumulative quarterly commercial profit: - Q1 (January-March): paid by 17 May - Q2 (April-June): paid by 17 August - Q3 (July-September): paid by 17 November - Q4 (October-December): paid by 17 February of the following year

All four quarterly payments are credited against the final annual Kurumlar Vergisi declared in April. Any shortfall is paid in April; any overpayment is refunded or credited against other taxes.

Reduced corporate tax rates Several mechanisms reduce the effective corporate tax rate below 25%:

• IPO incentive: Companies completing an initial public offering and listing on Borsa Istanbul receive a 2-percentage-point reduction in the corporate tax rate (23% instead of 25%) for 5 years.

• Investment Incentive Certificates: Companies with approved investment projects can benefit from corporate tax reductions ranging from 15% to 90% of tax depending on the investment region (Regions 1-6, with 6 being the most underdeveloped, offering the highest incentives) and investment size. Under a Strategic Investment Certificate, rates can approach 0% on income from the incentivised investment.

• Technology Development Zone (Technopark) companies: Income from software development and R&D activities conducted within a licensed Teknoloji Gelistirme Bolgesi is fully exempt from Kurumlar Vergisi.

• Free Zone companies: Companies operating in Turkish Free Zones (Serbest Ticaret Bolgesi) with export-oriented manufacturing can benefit from Kurumlar Vergisi exemption on manufacturing profits.

Comparison with neighbouring countries At 25%, Turkey's corporate tax rate is above the EU average (~21%) and higher than Ireland (12.5%), UAE (9% for SMEs), or Bulgaria (10%). It is comparable to Germany (approximately 29-33% combined) and slightly above the UK (25% main rate). The main advantage Turkey offers over these comparators is its generous investment incentive system, which can substantially reduce the effective rate for qualifying businesses.

Dividend withholding after corporate tax Once a Turkish company has paid Kurumlar Vergisi on its profits and distributes dividends to individual Turkish shareholders, an additional 15% Stopaj Vergisi is withheld on the dividend. The economic double taxation on profits extracted as dividends can therefore be significant: 25% at company level, then 15% on the remaining 75%, resulting in an effective combined rate of approximately 36.25% before the shareholder receives cash.