1. What is the Turkish GAAP?
Turkish GAAP (Generally Accepted Accounting Principles) refers to the accounting standards and regulations that businesses in Turkey must follow for financial reporting. These standards align with IFRS (International Financial Reporting Standards) but also include specific local regulations.
2. Do I need a Turkish accountant for my business in Turkey?
Yes, foreign businesses operating in Turkey must comply with local accounting laws, making it essential to hire a Turkish accountant or work with a certified local firm.
3. What is the role of an SMMM in Turkey?
An SMMM (Serbest Muhasebeci Mali Müşavir) is a certified public accountant in Turkey, responsible for providing accounting, tax consultancy, and financial reporting services to businesses.
4. What taxes do businesses in Turkey need to pay?
Businesses in Turkey are subject to various taxes, including corporate income tax, VAT (Value-Added Tax), withholding taxes, and stamp duty, among others.
5. How is VAT calculated in Turkey?
VAT in Turkey is calculated based on the value of goods and services sold. The standard VAT rate is 20%, but reduced rates of 1% or 10% may apply to certain goods and services.
6. What are the corporate tax rates in Turkey?
As of 2024, the corporate tax rate in Turkey is 25%, but this rate can vary depending on legislative changes. It’s important to consult a Turkish accountant for the latest rates.
7. What is the Turkish Commercial Code (TCC)?
The Turkish Commercial Code (TCC) governs all commercial activities in Turkey, including company formation, corporate governance, and financial reporting requirements.
8. Can foreign companies use IFRS in Turkey?
Yes, foreign companies listed on the Turkish stock exchange must prepare their financial statements in accordance with IFRS. However, non-listed companies primarily follow Turkish GAAP.
9. What are the audit requirements in Turkey?
In Turkey, companies meeting certain criteria, such as size and turnover, are required to have their financial statements audited by an independent auditor.
10. How do I register for taxes in Turkey as a foreign investor?
Foreign investors must register for taxes by obtaining a tax identification number from the Turkish tax authorities. This process is typically handled by a local accountant.
11. What is transfer pricing in Turkey?
Transfer pricing in Turkey refers to the rules and regulations that govern the pricing of transactions between related entities to ensure they are conducted at arm’s length.
12. How do foreign subsidiaries report taxes in Turkey?
Foreign subsidiaries in Turkey must file corporate income tax returns and other relevant tax declarations, adhering to Turkish tax laws and regulations.
13. Are there tax incentives for foreign investors in Turkey?
Yes, Turkey offers various tax incentives for foreign investors, including exemptions, deductions, and credits in certain sectors and regions.
14. What is the role of a YMM in Turkey?
A YMM (Yeminli Mali Müşavir) is a Sworn-in Certified Public Accountant in Turkey, authorized to conduct audits and certify tax returns for larger and publicly traded companies.
15. What is the withholding tax rate in Turkey?
Withholding tax rates in Turkey vary depending on the type of payment. For example, dividends are typically subject to a 15% withholding tax.
16. Can foreign companies repatriate profits from Turkey?
Yes, foreign companies can repatriate profits from Turkey, but they must comply with local regulations, including paying all applicable taxes before repatriation.
17. What accounting software is popular in Turkey?
Popular accounting software in Turkey includes Logo, Mikro, and Luca, all of which are tailored to comply with Turkish accounting standards.
18. What is the deadline for filing taxes in Turkey?
The corporate income tax return in Turkey must be filed by the end of April following the close of the fiscal year, which typically ends on December 31st.
19. How does Turkey handle foreign exchange transactions?
Foreign exchange transactions in Turkey are subject to specific regulations, including mandatory reporting to the Central Bank of Turkey for significant transactions.
20. What is the role of TÜRMOB in Turkey?
TURMOB (Union of Chambers of Certified Public Accountants of Turkey) is the regulatory body that oversees the accounting profession in Turkey, including the certification of SMMMs and YMMs.
21. How are financial statements prepared in Turkey?
Financial statements in Turkey must be prepared in accordance with Turkish GAAP, and in some cases, IFRS. These statements include the balance sheet, income statement, and cash flow statement.
22. What is the stamp duty in Turkey?
Stamp duty in Turkey is a tax on documents, such as contracts and financial statements, with rates varying depending on the type of document and transaction value.
23. How does Turkey tax dividends for foreign investors?
Dividends paid to foreign investors in Turkey are subject to a 15% withholding tax, which may be reduced under double taxation treaties.
24. Can foreign investors own 100% of a company in Turkey?
Yes, foreign investors can own 100% of a company in Turkey, with no restrictions on foreign ownership in most sectors.
25. What are the annual reporting requirements in Turkey?
Companies in Turkey must submit annual financial statements, tax returns, and other regulatory filings to the relevant authorities. Publicly traded companies also need to file reports with the Capital Markets Board.
26. How is personal income tax applied to expatriates in Turkey?
Expatriates working in Turkey are subject to personal income tax on their Turkish-sourced income. The tax rates are progressive, ranging from 15% to 40%.
27. What is e-invoicing in Turkey?
E-invoicing is a mandatory electronic invoicing system in Turkey for certain businesses, designed to increase tax compliance and streamline the invoicing process.
28. Are there restrictions on capital movement in Turkey?
Turkey generally allows free movement of capital, but significant transactions must be reported to the Central Bank of Turkey, and foreign exchange controls may apply in certain situations.
29. How are mergers and acquisitions taxed in Turkey?
Mergers and acquisitions in Turkey are subject to various taxes, including VAT, stamp duty, and potential capital gains tax. The specifics depend on the structure of the transaction.
30. What is the process for closing a business in Turkey?
Closing a business in Turkey involves several steps, including deregistering with tax authorities, liquidating assets, settling debts, and submitting final tax returns. This process typically requires the assistance of a local accountant.
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Invest CPA Ltd. Turkey 