Invest CPA Ltd. Turkey

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Depreciation Limit in Turkey in 2025

Introduction

For businesses operating in Turkey, managing fixed assets and determining their depreciation is a critical aspect of accounting and tax compliance. In 2025, Turkey has introduced a new depreciation limit, allowing assets valued up to ₺9,900 to be expensed directly instead of being depreciated over their useful life.

This updated threshold simplifies the accounting process for small-value assets and provides an immediate tax advantage. This article explores the depreciation limit for 2025, its implications for businesses, and strategies to optimize its benefits.

What is the Depreciation Limit?

The depreciation limit is the maximum value of an asset that can be recorded as a direct expense in the year it is purchased, rather than being depreciated over time. Assets exceeding this limit must be depreciated in accordance with their useful life, as determined by Turkish tax laws.

For 2025, the depreciation limit in Turkey is set at ₺9,900, an increase from the 2024 threshold of ₺6,900. This change reflects adjustments for inflation and aims to reduce administrative burdens for businesses.

Key Features of the 2025 Depreciation Limit

1. Applicability

The depreciation limit applies to:

  • Office furniture and equipment.
  • IT devices such as laptops, printers, and monitors.
  • Small machinery and tools.
  • Other low-value tangible assets used in business operations.

2. Direct Expensing

Assets with a purchase value of ₺9,900 or less can be recorded as an expense in the income statement for the year of purchase. This provides immediate tax relief by reducing taxable income.

3. Depreciation for Higher-Value Assets

Assets exceeding the ₺9,900 threshold must be capitalized and depreciated according to their designated useful life. Depreciation rates are specified by the Ministry of Treasury and Finance.

4. Compliance with Turkish Tax Laws

Businesses must adhere to the General Communiqué on Tax Procedure Law when applying depreciation. Proper documentation and classification of assets are essential to avoid penalties during tax audits.

Benefits of the Updated Depreciation Limit

The new depreciation limit offers several advantages to businesses in Turkey:

1. Simplified Accounting

By allowing low-value assets to be expensed directly, the updated limit reduces the need for complex depreciation calculations, saving time and resources.

2. Immediate Tax Savings

Direct expensing lowers taxable income in the year of purchase, providing businesses with faster tax relief.

3. Cash Flow Optimization

Immediate expensing improves cash flow by reducing tax liabilities earlier, allowing businesses to allocate resources to other priorities.

4. Inflation Adjustment

The increase in the depreciation limit from ₺6,900 to ₺9,900 reflects inflationary trends, ensuring the threshold remains relevant to current asset prices.

Example: Applying the 2025 Depreciation Limit

Scenario 1: Direct Expensing for Small Assets

A company purchases office equipment worth ₺9,500 in 2025. Since the value is below the ₺9,900 depreciation limit, the full amount can be expensed immediately in the income statement.

  • Impact on Taxes:
    • The company reduces its taxable income by ₺9,500, resulting in immediate tax savings.

Scenario 2: Depreciation for Higher-Value Assets

The same company purchases machinery worth ₺15,000. Since the value exceeds the depreciation limit, the asset must be capitalized and depreciated over its useful life.

  • Depreciation Calculation:
    • Assuming a useful life of 5 years and a straight-line depreciation method:
      • Annual depreciation = ₺15,000 ÷ 5 = ₺3,000.
    • The company can claim ₺3,000 as an expense each year for 5 years.

Compliance Requirements

To fully utilize the updated depreciation limit, businesses must ensure:

  1. Accurate Recordkeeping
    • Maintain detailed records of asset purchases, including invoices and receipts.
    • Classify assets correctly based on their nature and value.
  2. Proper Asset Valuation
    • Ensure that asset values include all relevant costs, such as transportation and installation, to determine whether they fall within the depreciation limit.
  3. Timely Reporting
    • Reflect all expenses and depreciation charges in financial statements accurately.
    • File tax returns in compliance with the General Communiqué on Tax Procedure Law.
  4. Audit Preparedness
    • Be prepared to provide documentation and justifications for expensed assets during tax audits.

Tax Planning Strategies for 2025

Businesses can maximize the benefits of the updated depreciation limit by adopting the following strategies:

1. Grouping Small Purchases

Plan asset purchases strategically to ensure items fall within the depreciation limit, enabling direct expensing.

2. Leveraging Bulk Discounts

Combine multiple low-value purchases to optimize operational needs while still benefiting from the ₺9,900 threshold.

3. Optimizing Depreciation for High-Value Assets

For assets exceeding the depreciation limit, choose the most suitable depreciation method (e.g., straight-line or declining balance) to align with cash flow requirements.

4. Consulting a Tax Advisor

Engage a professional tax advisor to ensure compliance and identify opportunities to reduce tax liabilities.

How Invest CPA Can Assist

At Invest CPA, we specialize in helping businesses navigate Turkey’s tax landscape. Our services include:

Asset Management and Depreciation

  • Evaluating and categorizing assets to determine applicability of the depreciation limit.
  • Ensuring accurate and compliant asset accounting in line with Turkish tax laws.

Tax Planning and Optimization

  • Providing strategies to maximize tax savings through direct expensing and depreciation.
  • Advising on asset purchase timing and grouping to optimize benefits.

Audit Support

  • Assisting clients during tax audits by ensuring all asset records are complete and compliant.
  • Representing businesses in discussions with tax authorities.

By partnering with Invest CPA, you can streamline your accounting processes, reduce tax burdens, and focus on growing your business.

Conclusion

The updated depreciation limit of ₺9,900 in 2025 simplifies asset management for businesses in Turkey while providing significant tax benefits. By understanding and applying this threshold effectively, companies can improve their cash flow, reduce administrative burdens, and achieve compliance with Turkish tax regulations.

For expert assistance with asset management and tax planning, contact Invest CPA today. Our experienced team is ready to help you navigate the complexities of the Turkish tax system and make the most of the 2025 depreciation limit.