Incomes that are Subject to Corporate Tax: In the case that the income elements specified in the Income Tax Law are derived by corporations, taxation is applicable on the legal entities of these corporations.
Corporations with legal or business centres located in Turkey are qualified as residents and are subjected to taxation on their income derived in Turkey and other countries. If both the legal and business centres are not located in Turkey, then these corporations are qualified as non-residents and subjected to taxation only on their income derived in Turkey.
Corporate Tax Rate
In Turkey, the corporate tax rate levied on business profits is 22% for 2021, and 2022.
5% Deduction in Calculated Corporate Tax
The taxpayers who satisfy the following conditions may benefit from a tax deduction by deducting 5% of the tax calculated over their annual income or corporate tax returns, from the income and corporate tax to be paid.
a) They must have submitted in due legal time their tax returns for the year when the deduction will be calculated and the last two years preceding that year, and paid in due legal time the taxes accrued on these returns.
b) There must be no tax assessment made additionally, ex office or by the administration against them as of the tax types subjected to tax return, in the year when the deduction will be calculated and the
last two years preceding that year
c) As of the date when the tax return for which the deduction will be calculated is submitted, they must have no overdue tax liabilities, principal amount of which is above TRY 1,000 (including tax penalties).
Those carrying on business in finance and banking sectors, insurance and reassurance companies, pension companies and pension investment funds may not benefit from this deduction.