What Is Payroll? How to Calculate Payroll?

Payroll is not merely a breakdown of a payment; it is also legal proof that the employer has fulfilled their obligations to the employee and that the employee has acknowledged receipt of the payment. During inspections, in labor courts, and in payroll disputes, this document serves as one of the most fundamental pieces of evidence.

What Is the Purpose of Payroll and Why Is It Important?

• It allows the employee to see how their salary is calculated (gross wage, net wage, overtime, bonuses, SSI contributions, and tax payments).
• It serves as the legal basis for the payments made to the employee.
• It provides the opportunity to verify the accuracy between the entitled wage and the wage actually paid.
• It ensures transparency of the employee’s income while serving as an official record that demonstrates the employer has fulfilled their legal obligations.

Legal Basis of Payroll

The employer, within the scope of the Labor Law, Law No. 5510, and the Tax Procedure Law, must regularly provide the employee with the payroll showing the amount of the wage, payment date, deductions, and net payment. You can access detailed information on this topic here.

The regulations constituting the legal basis of payroll are listed below:

• Labor Law Article 37: "In payments made at the workplace or to the bank, the employer is obliged to provide the worker with a slip showing the wage account, signed or bearing the special mark of the workplace. This slip must separately indicate the payment date and the period it relates to, as well as all types of additions made to the basic wage such as overtime pay, weekly rest day pay, holiday and general holiday pay, and all types of deductions such as tax, social security contribution, advance payment offset, alimony, and garnishment. These transactions are exempt from stamp tax and all kinds of duties and fees."
• Law No. 5510 on Social Insurance and General Health Insurance Article 102: "In the monthly wage payment payroll submitted by employers; it is mandatory to include the workplace registration number, the month to which the payroll relates, the insured person’s name and surname, the insured person’s social security registration number, the number of days for which the wage is paid, the insured person’s wage, the amount of wage paid, and the signature of the insured person acknowledging receipt of the wage. Payrolls for wage payments that do not contain any of the specified elements (excluding the signature requirement in the case of payments made against receipt or via bank) shall not be considered valid, and an administrative fine amounting to half of the monthly minimum wage shall be imposed for each invalid payroll."
• Tax Procedure Law Article 238: "Employers are obliged to keep a payroll for the wages they pay each month. The payroll must contain at least the following information:
1. The surname and name of the employee; their signature or stamp acknowledging receipt of the wage (In the case of wage payments where the employer issues a separate receipt, it is not mandatory to include a signature or stamp on the payroll kept by the employer.)
2. If applicable, the date and number of the tax card
3. Unit wage (monthly, weekly, daily, hourly, or piece-rate wage)
4. The period of work or the period to which the wage relates
5. The amount of taxes calculated on the wage.

The payroll must clearly indicate the month to which it relates at the top. A payroll for a given month must be prepared, dated, and signed by the owner or manager of the establishment and by the officer preparing the payroll no later than the twentieth day of the following month.

Employers may prepare payroll in any manner they choose, provided that they comply with the above requirements."

The Role of Payroll for Employers and Employees

Employer: In financial audits and inspections conducted by SSI and the Tax Inspection Board, payroll serves as the primary document demonstrating that legal obligations have been fulfilled. It also constitutes evidence in court.

Employee: Payroll is a monitoring tool showing how rights are paid. In cases such as incorrect payment, underreported contributions, or unpaid overtime, payroll forms the basis of the legal process for claims.

How and Where to Obtain Payroll

Steps to Obtain Payroll via e-Government

For public sector employees, it is possible to obtain payroll through the e-Payroll system. The steps are as follows:

• Log in to turkiye.gov.tr with your Republic of Türkiye ID number and password.
• Type "e-Bordro (e-payroll)" in the search box and click on the service that appears.
• Select the relevant period and download the payroll statement as a PDF.

Note: Private sector employees cannot obtain payroll from the e-Government portal. This document can only be provided by the employer, the HR department, or through online HR systems.

How Do Private Sector Employees Request Payroll?

Pursuant to Article 37 of Labor Law No. 4857, employers are obliged to provide employees with a written payroll for each wage payment. This slip must clearly show the employee’s gross and net wage, the statutory deductions made, and any additional payments, if applicable. Private sector employees who are not provided with a payroll may submit their request through the following methods:

• Written Request: The employee may request payroll from the Human Resources department via a written petition or e-mail. The employer must fulfill this request without delay.
• Sending the Wage Calculation Slip: The employer is responsible for delivering payroll to employees each month, together with the salary payment, either in digital or printed form. If this obligation is neglected, employees may resort to legal remedies.
• Bordromat® Payroll Process Management System:

Bordromat is a fast, secure, and smart platform that combines professional HR expertise with advanced technology, enabling you to manage payroll processes securely, accurately, and completely. Through the Bordromat Payroll Process Management System, employees can:

• Securely access payrolls in real time via web and mobile.
• Instantly view salary, bonuses, overtime, and other deduction items.
• Review and approve payroll statements directly in the system or submit objections regarding any items.
• Track monthly payroll notifications and approvals through digital records.
• Payrolls are digitally time-stamped for legal validity and can be approved via One-Time Password (OTP).

This system also provides employers with:

• Proof of delivery and timely payroll notifications to employees.
• Reduced paper and archiving costs.
• A record of employee objections.
• Quick and easy access to documents through e-archiving.
• Clear and accessible payroll items that strengthen trust and enhance the perception of transparency in the employment relationship.

Where Can Public Sector Employees Obtain Payroll?

• Through the e-Bordro application managed by the Ministry of Treasury and Finance.
• In addition, some institutions provide payroll via KBS (Public Information System) or their own portal systems.

Points to Consider When Receiving Payroll

• Name and surname, Republic of Türkiye ID number, employee number,
• Period (month/year) for which the payroll is issued,
• Gross wage, deductions, and net payment amount,
• Employer’s stamp and authorized signature (especially required for bank, consulate, or official transactions),
• Verification of whether additional payments and social benefits are accurately reflected in the payroll.

Note: Failure of the employer to provide payroll constitutes a violation of Labor Law No. 4857, and in such cases, the employee has the right to terminate the employment contract with just cause.

How to Prepare Payroll?

What Should Be Included in Payroll?

A payroll not only shows wage amounts but also contains a wide range of information from the employee’s employment status to tax obligations.

Employee Information, Wage Items, and Deductions

The following information must be included in payroll:

• Employee’s name, surname, Republic of Türkiye ID number, SSI registration number
• Type of wage (daily, hourly, monthly)
• Working time (days/hours)
• Gross salary
• Overtime, bonuses, premiums, meal allowance, child support, private health insurance and similar additional payments
• Statutory deductions such as SSI contributions, unemployment insurance, income tax, and stamp tax
• Net amount paid

Displaying SSI and Tax Deductions in Payroll

Each statutory deduction must be shown as a separate line item with its corresponding rate. For example:

• SSI Employee Share: 15%
• Unemployment Insurance Employee Share: 1%
• Income Tax: Progressive, between 15% and 40%
• Stamp Tax: 0.759%

These rates are updated annually under the Ministry of Treasury and Finance and SSI Communiqué. For 2026 payroll, these rates remain in effect.

Employer Information and Signature Requirement

The payroll must include the employer’s name, title, tax number, and address.

How Is Payroll Calculated?

Payroll calculation is not merely a simple process of deducting certain percentages from the gross salary; it is a payroll processing procedure that is systematic, legislation-compliant, and requires attention to detail. Statutory obligations such as Social Security (SGK) contribution deductions, income tax, stamp tax, and unemployment insurance must be meticulously calculated based on the employee’s gross wage; additional items such as overtime, transportation and meal allowances, bonuses, premiums, and, if applicable, sick leave deductions must be accurately integrated into the payroll. On the employer side, there are also cost items such as the SSI employer’s share of contributions and the employer’s unemployment insurance contribution. The payroll calculation process, carried out in accordance with the relevant provisions of Law No. 5510 on Social Insurance and General Health Insurance and Labor Law No. 4857, is critically important both for protecting employees’ rights and for ensuring the employer fully meets legal obligations. Particularly, the minimum wage, tax brackets, amounts exempt from social security base amount, and SSI incentives are among the current factors that must be taken into account in payroll calculations. The detailed calculation is provided below:

* Employees who receive an old-age pension and continue working under Article 4/a are not subject to unemployment insurance. For insured individuals within this scope, the applicable Social Security Support Contribution (SGDP) rates are as follows.

Social Security Support Contribution Rates

• Employee (Retired) Share: 7.5%
• Employer Share: 22.5%
• Short-Term Insurance Branch Contribution (Employer Share): 2.25%
• Total SGDP Rate: 32.25%

As the employee’s cumulative income tax base changes, their tax bracket also changes. Therefore, as the cumulative income tax base increases, employees’ tax rates may increase throughout the year. For example, an employee in the 15% income tax bracket in January may move to the 20% bracket in February due to an additional bonus payment.

How to Calculate Salary from Gross to Net and from Net to Gross?

One of the most common questions in wage management processes is how to calculate the difference between gross wage and net salary. For employers and Human Resources professionals, accurately calculating payroll is as important as it is for employees to understand the extent to which their salaries are shaped by statutory deductions. In particular, factors such as income tax, stamp tax, SSI contributions, and unemployment insurance deductions play a direct role in determining net salary. Therefore, when calculating salary "from gross to net" or "from net to gross," attention must be paid to legal regulations, current minimum wage data, and the employee’s working days.

Calculating Salary from Gross to Net

Gross wage is the total amount the employee is entitled to receive from the employer before taxes and deductions. Net salary, on the other hand, is the actual amount the employee takes home after statutory deductions such as SSI contribution, unemployment insurance, income tax, and stamp tax—essentially, the amount deposited into the bank account. When performing this conversion, tax brackets, minimum wage exemptions, and incentive applications must also be taken into account.

Calculate salary from gross to net

Calculating Salary from Net to Gross

Calculating salary from net to gross is the process of determining the gross wage corresponding to the amount the employee takes home (net salary). This calculation method is frequently used during recruitment processes or in salary offers to determine the total cost to the employer for the employee’s requested net salary.

Calculate salary from net to gross

2026 Minimum Wage Payroll Calculation Example

For 2026, the minimum wage determined by the Ministry of Labor and Social Security and the Minimum Wage Determination Commission has been announced as a gross amount of 33,030.00 TRY. After statutory deductions from this gross amount, the net minimum wage is calculated as 28,075.50 TRY. The details of the minimum wage payroll calculation are as follows:

Employer Cost of Minimum Wage in 2026

As of 2026, the gross minimum wage is set at 33,030.00 TRY. This amount not only represents the employee’s entitlement but also entails obligations that the employer must cover. The employer is required to pay social security contributions on behalf of the employee, which increases the total employer cost above the gross wage.

• Gross wage: 33,030.00 TRY
• SSI employer’s premium (21.75%): 7,184.03 TRY
• Employer’s unemployment insurance contribution (2%): 660.60 TRY
• Total cost: 40,874.63 TRY
• Total cost (without incentives): 40,214.03 TRY

Key Points to Consider When Preparing Payroll

Payroll is not only a salary calculation document but also a critical record proving that the employer has fulfilled their legal obligations toward the employee. Therefore, the elements to consider when preparing payroll are of great importance in terms of both regulatory compliance and corporate transparency.

1. Compliance with Legislation and Monitoring of Current Legal Rates

SSI contribution rates, income tax brackets, unemployment insurance deductions, and minimum wage amounts used in payroll calculations can change annually. For this reason, payroll must always comply with fundamental legal regulations such as Law No. 5510 on Social Insurance and General Health Insurance, Labor Law No. 4857, and the Income Tax Law.

Note: Automation systems and payroll software should be regularly updated, and if manual intervention is required, it must be done under expert supervision.

2. Accurate and Complete Employee Information

Employee details in payroll such as Republic of Türkiye ID number, SSI registration number, job title, working days, and leave/sick leave records must be entered correctly. Missing or incorrect data can result in both loss of rights for the employee and potential administrative penalties for the employer.

3. Clear Display of Deductions and Payments

The payroll must clearly indicate how the employee’s salary is structured, which items are deducted from the gross wage, and which payments are added. This transparency documents that the employer has met obligations clearly and allows employees to easily understand how much is deducted and why.

4. Consistency with SSI and Tax Declarations

SSI contributions and tax deductions shown in payroll must exactly match the data reported in SSI monthly contribution and service documents, withholding tax returns, and the e-Declaration system. Otherwise, administrative fines and audit risks may arise.

5. Privacy and KVKK-Compliant Process Management

Information contained in payroll is considered personal data. Under Law No. 6698 on the Protection of Personal Data (KVKK), payroll must be stored in secure systems accessible only to authorized persons, and necessary confidentiality measures must be taken when delivering payroll via e-mail or in person.

6. Payroll Signing and Digital Approval Process

Payroll should be signed by the employee either with a wet signature or with a timestamped digital approval. Unsigned payroll may be insufficient for the employer to prove legal compliance. At this point, the Bordromat® Payroll Process Management System offers an important solution for online payroll viewing and approval processes.

7. Integration with Accounting and HR Systems

Integrating payroll processes with accounting systems, ERP infrastructures, and HR management systems offers significant advantages in terms of process automation and data security.

The Role and Implementation of SSI Incentives in Payroll

In payroll processes, SSI incentives, designed to provide employers with cost advantages, are among the key components of Türkiye’s employment policies. Introduced to promote employment, prevent informal work, and reduce the employer’s financial burden, these incentives are one of the most important areas to consider within payroll services.

SSI incentives that employers can benefit from on a monthly basis not only provide financial advantages but are also critical for ensuring legal compliance. However, since each of these incentives has its own specific conditions, application procedures, and compliance criteria, it is recommended that they be managed with the support of expert consultancy.

Impact of SSI Incentives on Payroll

SSI incentives applicable to employers have a direct effect on payroll calculations. When these incentives are applied, the reduction in the employer’s share of premiums lowers the total employer cost. This impact can be clearly observed in payroll summaries and reports.

Current Social Security Premium Incentives

Within the scope of social security legislation, various social security premium incentives are implemented with the aim of increasing employment, reducing informal work, alleviating employer costs, and supporting certain social policies. Currently, there are a total of 15 premium incentives in effect. Of these, 13 are aimed at workplaces employing insured individuals under Article 4/a (employees working under an employment contract), and 2 are aimed at those under Article 4/b (self-employed individuals).

Current Incentives

1. 2-Point Reduction in Employer Share of Disability, Old-Age, and Survivors’ Insurance
2. 5-Point Reduction for Employees Taken/Sent Abroad
3. 4/b (BAĞ-KUR) 5-Point Reduction Incentive
4. Young Entrepreneur Incentive
5. Incentive Applied Under Decisions on State Aid for Investments
6. Minimum Wage Support
7. Contribution Incentive for the Employment of Unemployment Benefit Recipients
8. Unemployment Insurance Contribution Incentive for Workplaces Classified as Very Hazardous
9. Incentive for the Employment of Young People, Women, and Vocational Qualification Certificate Holders
10. Incentive for the Employment of Disabled Employees
11. Incentive Related to Research, Development, and Design Activities
12. Social Security Contribution Incentive for Cultural Investments and Initiatives
13. Incentive for the Employment of Persons Benefiting from Social Services
14. Incentive for the Employment of Social Assistance Recipients
15. Incentive for Supporting Occupational Health and Safety Services

Most Commonly Used SSI Incentives

Below is a summary of some of the SSI incentives most frequently encountered in payroll processes as of 2026:

To benefit from these incentives, employers must meet certain technical requirements, such as having no outstanding SSI debts, submitting declarations on time, and accurately reporting new hires.

Points to Consider in the Implementation of Incentives

• The same insured employee cannot benefit from more than one incentive in the same period. An analysis should be conducted to determine which incentive is more advantageous.
• Declarations must be submitted in the SSI system with the correct codes and on time.
• Retroactive incentive calculations and incentive optimization for past periods can be performed.
• Incorrectly applied incentives may result in penalties for the employer during SSI inspections.

Full Support from CottGroup in Incentive Management

As part of its payroll services, CottGroup offers SSI incentive consultancy to ensure that employers make the most efficient use of all available incentives. With our advanced system infrastructure and experienced payroll specialists, we meticulously manage all processes, including:

• Matching eligible insured employees,
• Incentive transitions and comparative analysis,
• Retroactive incentive checks,
• Ensuring compliance with incentives in e-Declaration, e-Return and monthly contribution and service documents.

You can access detailed information about our incentive services to maximize the benefits of SSI incentives and manage your payroll processes in full legal compliance.

Payroll Terms and Abbreviations

Understanding payroll terms and abbreviations correctly is crucial for both employees and employers. The table below lists common terms found in payroll statements, their abbreviations, and brief explanations:

Integrated Solutions in Human Resources and Payroll Management with CottGroup^®

CottGroup^®, as the trusted payroll solution partner of multinational companies operating in Türkiye, provides fully compliant, secure, and high-volume payroll outsourcing services.

With over 25 years of industry experience and our expert team in Human Resources and payroll, we develop innovative, modern, and fully compliant solutions for our clients’ payroll outsourcing and Human Resources software needs.

Built upon this expertise, Bordromat^® combines human resources experience with advanced technology to deliver enterprise-level, cloud-based payroll solutions. Through its seamless integration with Informasoft^® Human Resources Management System, employee data, organizational changes, leave and attendance records are automatically reflected in payroll processes. With real-time ERP integration, robust API architecture, and an intelligent rule engine, it ensures reliable and sustainable data flow across HR, finance, and compliance systems.

Bordromat^® is more than just salary calculation; it is a comprehensive platform that digitizes the entire payroll lifecycle, from onboarding to offboarding, from R&D and union applications to statutory declarations. It transforms workforce management into an agile, measurable, error-free, and efficient operation.

Should you have any queries, please contact us.