🇹🇷 Tax2 Aug 2024
Türkiye adopts a 10% domestic minimum corporate tax and the global minimum tax
Türkiye's Law no. 7524, published on 2 August 2024, introduces a domestic minimum corporate tax: companies pay the higher of normal corporate tax and 10% of profit before most deductions and exemptions, from 2025 profits. The same law brings in the OECD's 15% global minimum tax for large groups from fiscal years starting on 1 January 2024, with the undertaxed profits rule from 2025.
Law no. 7524 amends the Corporate Tax Law, the Income Tax Law, the VAT Law and the Tax Procedure Law. It was published in the Official Gazette on 2 August 2024. Different articles take effect on different dates.
What changed
- Domestic minimum tax: corporate tax cannot be less than 10% of corporate income before deductions and exemptions. Some items, such as participation income, still reduce the base. New companies are exempt for their first three accounting periods. It applies to 2025 profits onwards.
- Global minimum tax (Pillar Two): groups in scope must calculate their effective tax rate in each jurisdiction and pay top-up tax up to 15%. It applies to fiscal years starting on or after 1 January 2024. The undertaxed profits rule (UTPR) applies from fiscal years starting on or after 1 January 2025.
- Other changes: carried-forward VAT can only be used for five years, and the exemption for investment funds and companies is narrowed.
Who is affected
Turkish companies and multinational groups with Turkish entities, and their finance and tax teams.