Certain Deduction and Exemption Rates Under the Income Tax and Corporate Tax Laws Have Been Amended

Published in the Official Gazette dated April 30, 2026, Presidential Decree No. 11257 introduced amendments to certain significant exemption and deduction rates set forth under the Income Tax Law and the Corporate Tax Law.

The amendments are summarized below:

• Under the regulation regarding the income tax exemption for dividends received by individuals from foreign entities in which they hold at least 50% of the paid-in capital, provided that half of the dividend income is transferred to Türkiye, the minimum ownership requirement was reduced from 50% to 20%.
• The deductible portion of income derived from services rendered abroad, provided that such income is transferred to Türkiye, was increased from 80% to 100%.
• Regarding the exemption for foreign subsidiary income, provided that at least 20% of the paid-in capital of the foreign subsidiary is owned and the income is transferred to Türkiye by the deadline for filing the relevant corporate tax return, the ownership threshold was reduced from 50% to 20%, while the exemption rate was increased from 50% to 80%, regardless of the other exemption conditions.
• For income derived from services rendered abroad, a requirement was introduced mandating the transfer of the entire income to Türkiye in order to benefit from the corporate tax deduction. In addition, the deductible amount was increased to 80% of the income.

Presidential Decree No. 11257 dated April 29, 2026 entered into force on the date of its publication and will apply to income and earnings relating to taxation periods starting from January 1, 2026.

You may access the relevant Official Gazette published on the subject here. (In Turkish)