The Turkish corporate tax rate is twenty-five per cent, and almost nobody who asks me the question pays exactly that. Banks and the rest of the financial sector pay thirty. An exporter pays twenty on its export profit. A manufacturer with an industrial registry certificate pays twenty-four this year and, under a law adopted in May 2026, twelve and a half from 2027. A company with an incentive certificate may pay a fraction of the rate for years, and since 2025 every company checks its result against a floor of ten per cent of profit before exemptions. In my files the foreign owner who is surprised is not the one who read the wrong rate; it is the one who read the right rate and did not know about the floor, or who built a 2027 plan on the 2026 reduction. This page sets out the rates in force for 2026 with the provisions that fix them, the calendar of advance tax and the annual return, the reductions and what they require, the domestic minimum tax, the deductions a foreign-owned company actually uses including two new ones from 2026, and what changes in 2027.
Sources, checked 9 September 2026. Corporate Tax Law No. 5520, Articles 5(1)(a), (b) and (e), 9, 10(1)(i), (j) and (ı), 11(1)(i), 14, 21, 32, 32/A, 32/C, 33 and Additional Article 1; Income Tax Law No. 193, Repeated Articles 120 and 121; Law No. 7456 (Official Gazette 32249, 15 July 2023); Law No. 7524 (Official Gazette 32620, 2 August 2024); Law No. 7566 (4 December 2025); Law No. 7582 (adopted 21 May 2026, Official Gazette 4 June 2026); Presidential Decision 9160 (Official Gazette 32735, 27 November 2024); Income Tax General Communiqué Series No. 332 (Official Gazette 33124, 31 December 2025); the Revenue Administration's 2026 guides on corporate tax rates, on the domestic minimum corporate tax and on the corporate tax return.
The headline rates, and who pays thirty
Article 32(1) of the Corporate Tax Law taxes corporate income at twenty-five per cent. The rate was twenty until Law 7456 of July 2023 raised it to twenty-five for the 2023 fiscal year onwards and raised the financial sector's rate from twenty-five to thirty. The thirty per cent list is closed: banks; the leasing, factoring, financing and savings-finance companies governed by Law 6361; electronic payment and electronic money institutions; authorised foreign exchange bureaus; asset management companies; capital market institutions; insurance, reinsurance and pension companies; and, for 2025 and later years by Law 7524, the project companies that are party to build-operate-transfer contracts under Law 3996 and to public-private partnership health contracts under Law 6428. A trading, manufacturing, technology or property company owned from abroad is at twenty-five whatever the nationality of its shareholders; the Foreign Direct Investment Law's equal treatment rule means there is no separate rate for foreign-owned companies, and no lower one either.
The rate applies to the net corporate profit determined under the commercial profit rules of the Income Tax Law, after the deductions and exemptions described below, and it is the same rate for a subsidiary and for the Turkish branch of a foreign company; the branch adds the fifteen per cent remittance tax described on the branch and subsidiary page, the subsidiary adds the fifteen per cent dividend withholding on the dividend page.
The calendar: advance tax four times a year, the return in April
Article 32(2) makes every company pay advance corporate tax at the current corporate rate on its quarterly cumulative profit, under the rules of Repeated Article 120 of the Income Tax Law. Until 2024 there were three advance periods; Law 7566 of December 2025 removed the words that limited them to the first nine months, and from the 2025 fiscal year there are four. For a calendar-year company the Revenue Administration's 2026 return guide gives the dates: the January to March period is declared and paid by 17 May, April to June by 17 August, July to September by 17 November, and October to December by 17 February. Each period is cumulative, and advance tax paid is credited against the annual tax. The annual return is filed electronically between the first and the last day of the fourth month after the fiscal year ends, 1 to 30 April 2026 for the 2025 year, and Article 21 requires payment by the end of the month in which the return is filed. A company on a special fiscal year files by the end of the fourth month after its own year-end.
The reductions that lower the rate, and what 2027 changes
| Reduction | What it requires | Effect | Basis |
|---|---|---|---|
| Initial public offering | At least 20% of the shares floated for the first time on Borsa İstanbul after 17 November 2020; financial companies excluded | 2 points off for five fiscal years from the year of the offering; clawback with interest if the 20% is lost within those years | Article 32(6) |
| Export | Profit derived exclusively from exports, including manufacturers exporting through foreign trade capital companies under an intermediated export contract | 5 points off on the export profit | Article 32(7), Law 7491 |
| Manufacturing, 2026 | Industrial registry certificate and actual production; software produced under the certificate qualifies | 1 point off on the production profit; export and production reductions are not stacked on the same profit | Article 32(8) as in force for 2026 |
| Manufacturing and agriculture, from 2027 | Industrial registry certificate and actual production, or agricultural production | Corporate tax at 12.5% on that profit; no additional export reduction on it | Article 32(8) as rewritten by Law 7582, for 2027 and later fiscal years |
| Investment incentive certificate | Investment under a certificate from the Ministry of Industry and Technology; finance, insurance, joint ventures, contracting and certain concession works excluded | Reduced rate on the profit of the investment until the state's contribution is reached | Article 32/A, Decision 9903 |
| SME merger | Merger of manufacturing SMEs holding industrial registry certificates | Rate reducible by up to 75% on production profit for three fiscal years, by Presidential decision | Article 32(5) |
Two points about the table decide real cases. First, Article 32(9) applies the export and manufacturing reductions after the other reductions in the article, so an exporter that also floated on the exchange takes the two points first and the five points on what remains of the rate. Second, the 2027 manufacturing rate is a rate, not a reduction: Law 7582, adopted on 21 May 2026 and published on 4 June 2026, replaces the one-point cut with a flat twelve and a half per cent on production profit of certificate holders and on agricultural production profit, with effect for income of the 2027 fiscal year and later, and Article 14 of that law leaves 2026 under the old paragraph. A manufacturer budgeting 2026 uses twenty-four per cent; one budgeting 2027 uses twelve and a half, and cannot add the export reduction to the same profit. The incentive certificate route, and the regional map that decides how much of the rate it removes, is on the incentives page; the free zone route, which is an exemption rather than a rate, is on the free zone page.
The floor: the ten per cent domestic minimum corporate tax
Law 7524 added Article 32/C in 2024, and it applies from the 2025 fiscal year and to every advance tax period since. The corporate tax computed under Articles 32 and 32/A may not be less than ten per cent of the corporate profit before deductions and exemptions, which Article 32/C(6) defines as the commercial balance-sheet profit at year-end plus the expenses the tax law does not accept. If the tax computed the ordinary way is lower, the difference is paid as minimum tax.
The floor is not blind to every relief. Article 32/C(2) lists what is still deducted before the ten per cent is applied: the domestic participation exemption of Article 5(1)(a), the emission premium exemption, the fund and partnership exemptions in Article 5(1)(d), (i), (j) and (k) other than gains from a fund's own real estate, the deductions in Article 10(1)(g), (h), (i) and (j), the exemptions of the Turkish International Ship Registry and of the Free Zones Law, the technopark exemption and the R&D and design deductions, and, since Law 7582, the Istanbul Finance Centre deduction. Everything else that lowers the ordinary base, including past losses under Article 9, the share-sale exemption and the cash capital deduction, is added back for the floor. Article 32/C(3) then credits against the minimum tax the tax not collected because of the IPO, export and manufacturing reductions, and the tax not collected under incentive certificates issued before the article took effect, which is why an exporter's twenty per cent does not trigger the floor. Article 32/C(5) exempts a newly formed company for the fiscal year in which it starts and the two following years, so a company formed in 2026 first meets the floor in 2029. The President may reduce the rate to zero or double it by sector.
What the floor changes in practice is the value of losses and of the cash capital deduction. A company that earns ten million lira, carries forward eight million of losses and would otherwise pay half a million in tax pays one million instead, and the unused loss remains available within its five-year life. The company formation choices that feed these numbers, including the minimum capital that must be paid in, are on the company set-up page.
The second floor, for large groups only
The same 2024 law added Additional Articles 1 to 13, Turkey's version of the OECD minimum tax. They apply to the Turkish entities of a multinational group whose consolidated revenue exceeded the lira equivalent of 750 million euros in at least two of the four preceding fiscal years, from the 2024 fiscal year onwards, through a domestic top-up tax and the income inclusion and undertaxed payments rules. A Turkish subsidiary of a group below that threshold is outside these articles entirely; one inside them will normally find that the twenty-five per cent rate leaves little to top up, and that the incentive-driven cases are the ones to model.
What comes off before the rate: the deductions foreign owners use
| Provision | Rule as in force in 2026 |
|---|---|
| Article 5(1)(a) | Dividends received from another Turkish company are exempt |
| Article 5(1)(b) | Dividends from a foreign company are exempt if the Turkish company holds at least 10% for at least one year, the foreign profit bore at least 15% tax (the Turkish rate for finance and investment companies), and the dividend is brought to Turkey by the return date |
| Article 5(1)(e) | 75% of the gain on shares and similar rights held two full years is exempt by statute, reduced to 50% by Presidential Decision 9160 of 27 November 2024; the real estate sale exemption was abolished for properties acquired after 15 July 2023 by Law 7456, and stands at 25% for older properties; the proceeds must be collected within two years and the exempt part kept in a fund account for five |
| Article 10(1)(ı) | Cash capital: a deduction each year for five years equal to 50% of the notional interest, at the Central Bank's average commercial lending rate, on cash paid into capital, 75% where the cash comes from abroad; not for financial companies |
| Article 10(1)(i), Law 7582 | From the 2026 fiscal year, 95% of the profit from selling goods bought abroad without bringing them into Turkey, or from intermediating trades where both seller and buyer are abroad, is deductible if brought to Turkey by the return date; 100% in the Istanbul Finance Centre and designated industrial zones |
| Article 10(1)(j), Law 7582 | From the 2026 fiscal year, 95% of the foreign-sourced profit of a qualified service centre under the Foreign Direct Investment Law is deductible for twenty fiscal years from the year it starts, 100% in the Istanbul Finance Centre and designated industrial zones; the amount must be brought to Turkey by the return date |
| Article 9 | Losses are carried forward five years, each year shown separately on the return |
| Article 33 | Foreign corporate taxes on foreign income included in the Turkish base are credited against the Turkish tax |
| Article 11(1)(i) | Where borrowings exceed equity, a Presidentially set share of the financing costs on the excess, at the statutory ceiling of 10%, is not deductible; financial companies and costs capitalised into investments excluded |
| Repeated Article 121, Income Tax Law | A compliant company deducts 5% of its assessed corporate tax, capped at 12,000,000 lira for 2026 under Communiqué 332, if the returns for the year and the two prior years were filed on time, no ex officio assessment became final in that period, and the taxes on those returns were paid by the filing date; the financial sector is excluded |
Two of these are new this year and are aimed at exactly the reader of this page. The transit trade deduction in Article 10(1)(i) turns a Turkish company that buys in one foreign country and sells in another, or brokers such trades, into an almost untaxed vehicle for that activity, at a five per cent effective base times the twenty-five per cent rate, provided the goods never enter Turkey and the profit is transferred here before the April return. The qualified service centre deduction in Article 10(1)(j) does the same for twenty years for a centre serving a group's operations abroad from Turkey. Both apply to returns filed from 1 July 2026 for income of the 2026 fiscal year, both depend on definitions and conditions in the Foreign Direct Investment Law and the decisions under it, and both sit alongside the twenty-year personal exemption for founders who move here, on the Law 7582 page. Payroll and the employer's social security cost, which are the other large line in a service centre's budget, are on the employment law page.
Three companies, one year
| Company, profit 10,000,000 lira | Rate on the profit | Tax before the floor | Floor check |
|---|---|---|---|
| Trading company, no reductions | 25% | 2,500,000 | Above 1,000,000; nothing added |
| Exporter, all profit from exports | 20% | 2,000,000 | The 500,000 not collected under Article 32(7) is credited; nothing added |
| Manufacturer, 2026 | 24% | 2,400,000 | Same credit mechanism; nothing added |
| Manufacturer, 2027 | 12.5% | 1,250,000 | Credit for the reduction; nothing added |
| Trading company with 8,000,000 of past losses | 25% on 2,000,000 | 500,000 | Floor is 1,000,000; 500,000 minimum tax is added, losses remain usable |
The table ignores the five per cent compliance discount, advance tax already paid, and the withholding on dividends and on payments abroad that follow the corporate tax and are set out on the withholding page.
Whose side we are on, and how we are paid
The accountant who files the return is paid whether the reductions were claimed or not. The adviser who sold the incentive certificate is paid on the certificate. The bank is paid on the capital transfer. None of them is paid to tell you that the floor removed the value of your losses, that the manufacturing rate you were promised starts in 2027, or that the transit trade deduction fails if the goods touch a Turkish port.
We take no commission or referral fee from accountants, banks or corporate service providers, in any form, on any file. The fee you pay us is our only income from your matter, and it does not depend on the structure you choose or the tax you save. Because our position does not move with the outcome, telling you that a reduction does not fit your facts, or that the ordinary twenty-five per cent is the right answer for your company, costs us nothing to say.
One boundary, stated plainly. We are lawyers, not licensed investment advisers and not your home-country tax preparers. We do not tell you what your own state will charge on the Turkish profit or whether to invest in Turkey at all. What we protect is the Turkish legal position: the rate and reductions that fit your activity on the facts, the conditions attached to each and the clawbacks when they are lost, the floor calculation, the deductions and the documents that support them, and the order in which they apply.
Before you plan the year
Send us a description of the company's activity, where it sells and buys, whether it holds an industrial registry or incentive certificate, its capital history and its loss position. We will tell you the rate that applies to each stream of profit in 2026 and 2027, whether the floor bites, which deductions are available and what each requires before year-end, and how the corporate tax interacts with the dividend and payment withholding that follows. Our cross-border tax work is described on the international tax page.
What this page does not settle
Inflation adjustment of the accounts under the Tax Procedure Law, the valuation rules that feed the commercial profit, value added tax, municipal and property taxes, personal income tax on salaries and dividends, and the taxation of liquidation and capital reduction are separate subjects. The conditions attached to the incentive certificate, the free zone licence and the qualified service centre status are set by decisions and communiqués that change, and rates and thresholds are set by Presidential decision; the figures above are those in force on the date checked.
