Incentives and Taxcuts: VAT Exemption Consulting business co

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The Turkish government supports renovation, new investment, and additional investment. Foreign investors are also eligible for these investment incentives. Investors should apply for an investment incentive certificate in order to benefit from these fantastic government incentives.

Turkey's investment incentive system is based on the type of investment, the industry, the product, and the region (or location) where the investment will be made.

1.  VAT Exemption

For investment projects, especially those involving the purchase of machinery and equipment both domestically and abroad, there is the option of a VAT (value-added tax) exemption incentive. For machinery and equipment purchased as part of an investment project, investors are exempt from paying VAT.

2.  Customs Duty Exemption

For investment projects, there is a customs duty exemption incentive, particularly for machinery and equipment that will be bought both domestically and internationally. Machinery and equipment bought as part of an investment project are exempt from customs duties for investors.

3. Corporate Tax: Income Tax Reduction

Until the incentive amount, which is the portion of the investment amount determined by the Ministry, is exhausted, income and corporate tax are reduced in accordance with the "contribution to investment ratio." According to investment zones and sectors, the contribution to the investment ratio is determined. The incentive rate ranges from 15% to 66% of the investment.

4. Social Insurance Premium Incentives (Employer’s Share)

The government pays the employer's portion of the social security premium, which is something that the employer is required by law to do. This incentive is valid until the Ministry-determined portion of the investment amount runs out. The incentive amount is determined by the zones and sectors where investments are made. The incentive rate ranges from 10% to 35% of the investment amount over a ten-year period.

5. Social Security Premium Support (Employee’s Share)

The government pays the employer's portion of the social security premium, which is something that the employer is required by law to do. Only investments made in Region 6 that fall under the purview of an investment incentive certificate are eligible for this incentive. The Social Security Premium Incentives have no upper limit and are good for 10 years.

6. Income Tax Withholding Discount

The government is responsible for covering the income tax that the employer is required by law to pay on behalf of the employee. Only investments made in Region 6 are eligible for this incentive. The Income Tax Withholding Discount is available for 10 years and has no upper limit.

7. Interest Rate Incentives

A financial incentive offered for at least one one-year investment loan is the interest rate incentive. A portion of the interest or profit share that must be paid on the loan is covered by the government, up to 70% of the fixed investment amount listed in the investment incentive certificate. It applies to loans denominated in Turkish Lira or foreign currencies.

8. Land Allocation

Investors are given the chance and the right to request land allocation in exchange for their investments. However, the regulations place restrictions on the amount of land that is available.

9. VAT Refund

In conjunction with strategic investments that require a minimum fixed investment of more than 500 million Turkish liras, VAT is reimbursed for building construction costs.

We make sure that our clients are aware of the tax breaks and incentives that are offered.