Law on Making Amendments to Certain Laws for the Purpose of Improving the Investment Climate, has been issued on the Official Gazette dated 08/09/2016, with the Law Number 6728.

The Social Security Institution’s 2016/12 numbered notice has been published and entered into the force as of 22.06.2016.

By examining Article 80 of the Social Security and General Health Insurance Law numbered 5510 titled “Earnings Subject Premiums”, the notice has brought clarity to the topic of which benefits cannot be treated as benefits in kind.

A ) Income Tax Exempted Severance Pay

According to the circular numbered 27998389-010-06-02-6152 released by the General Directorate of Budget and Fiscal Control on 07.01.2016 with the subject ‘Financial and Social Rights’, the coefficients used to calculate the wage of a civil servant have been revised effective 01.07.2016.

The following values have been calculated taking these coefficients into account, and shall be applied for the period between the dates of 01.07.2016 – 31.12.2016;

1. Maximum severance pay to be exempted from income tax is 4.297,21.- TL,

The Regulation on Payment of Wages, Premiums, Bonuses and All Kinds of Remunerations Qualifying As Such Via Banks, published in the Official Gazette dated 18 November 2008 and no. 2705818, stipulated that, in the event of the number of people employed under Labor Law, Maritime Labor Law and Press Labor Law being 10 and higher, all kinds of payments falling within the scope of the regulation was required to be effected via bank. By the regulation published in the Official Gazette dated 21 May and no. 29718, the limit of number of people that was 10 was updated as 5. In addition, "Bank" and "Account" terms were redefined in the new regulation.