A parallel minimum tax calculation sets a floor under the effective rate, capping what investment and R&D incentives can actually deliver. How to model the benefit net of the floor.
- Domestic minimum tax floor
- Quarterly advance tax
- How does Turkey's domestic minimum tax work?
Turkey's standard corporate tax rate is 25% (30% for financial institutions), applied after deductions and exemptions — but since 1 January 2025 a parallel domestic minimum tax regime requires every corporate taxpayer to also compute liability at 10% of taxable income before most exemptions and deductions, paying whichever of the two results is larger. Unlike the OECD Pillar Two minimum tax it echoes, Turkey's version is not restricted to large multinational groups above a consolidated-revenue threshold: it applies broadly, which caps the practical effect of investment incentives, R&D deductions and other reliefs that would otherwise reduce a company's effective rate below 10%.
What a company pays in Turkey. Every figure below is published on the Turkey country page.
| Turkey | |
|---|---|
| Corporate tax rate | 25% standard (30% for financial institutions) · domestic minimum tax floor of 10% of pre-exemption income applies to all corporate taxpayers (from FY2025) |
| VAT standard rate | 20% |
| VAT reduced rates | 10% (food, medicine) and 1% (basic commodities) |
| Accounting standard | Turkish Uniform Chart of Accounts (Tekdüzen Hesap Planı), per the Tax Procedure Law |
| Currency | TRY (Turkish lira) |
What makes it complex in Turkey
- Domestic minimum tax floor — from FY2025 — every corporate taxpayer computes liability under both the standard 25% regime and a parallel 10% pre-exemption calculation, paying whichever is higher; unlike OECD Pillar Two, this is not limited to large groups.
- Quarterly advance tax — — corporate taxpayers file and pay advance tax quarterly (17th of the second month following each quarter) in addition to the annual return, on top of the year-end CIT filing.
How does Turkey's domestic minimum tax work?
Since 1 January 2025, every corporate taxpayer computes liability under two parallel methods — the standard 25% rate after exemptions and deductions, and 10% of income before most exemptions and deductions — and pays whichever produces the higher amount. Unlike OECD Pillar Two, it is not limited to large multinational groups.
What is the dividend withholding tax rate?
15%, applying to distributions to both resident and non-resident shareholders, raised from 10% by Presidential Decree effective December 2024. Lower rates may apply under Turkey's double tax treaties, subject to eligibility conditions.
Domestic minimum tax floor is one of the points HTLC Network handles for clients operating in Turkey, within a single engagement that covers every other country they operate in — executed locally, governed centrally.
In Turkey the scope is: Statutory bookkeeping under the Turkish Uniform Chart of Accounts, VAT returns across Turkey's three active rates, and corporate tax filings tracking both the standard 25% calculation and the 10% domestic minimum tax floor.
See Accounting & Tax Compliance in Turkey for the full scope, or the Turkey country page for the statutory framework across every service.
Figures as published on the HTLC Network country pages, reviewed September 2026 and collected from public sources. They are not a substitute for advice on a specific case and should be verified before being relied on.