Government Incentive For Foreigners in Turkey
Turkey offers a lot of opportunities for foreign investments. There are numerous government incentives for these investors within the country.Through these incentives, investors can operate more efficiently and profitably. Here are government incentives offered to investors in Turkey.
Incentives that foreigners can get in Turkey;
- Tax Breaks:
Income and corporate tax are calculated at discount rates until the total reduced tax amount reaches the investment contribution rate. Investment contribution rate refers to the tax-deductible rate of the total fixed investment amount.
- Customs Tax Exemption:
Customs duty is not paid for machinery and equipment to be purchased from abroad within the scope of investment incentive certificate.
- Social Insurance Premium Support (Employee Share):
The employee's share of the social insurance premium calculated on the legal minimum wage amount for employment provided by investment is covered by the state. This element applies only to investments to be made in Zone 6 under the investment incentive certificate. There is no upper limit for Social Insurance Premium Support and is valid for 10 years.
- Social Insurance Premium Support (Employer's Share):
The employer's share of the Social Insurance Premium calculated on the legal minimum wage amount for employment provided by investment is covered by the state.
- Income Tax Withholding Deductions:
Income tax determined for additional employment provided by investment is not subject to withholding. This element applies only to investments in Region 6. There is no upper limit for Income Tax Withholding Allowance and is valid for 10 years.
- VAT (KDV) exemption:
VAT (value added tax) is not paid for machinery and equipment sold at home and abroad within the scope of the investment incentive certificate.
- VAT (KDV) refund:
VAT charged for building-construction expenses is refunded if minimum fixed investment amount realized within the scope of strategic investments over 500 million TL
- R & D (Research and Development) Incentives:
Special incentives are offered for R & D and design investment projects in Turkey if at least 15 personnel are employed in R & D centers and at least 10 personnel are employed in design centers. Some of these incentives are:
• 100% of R & D expenses are deducted from the tax base.
• Stamp duty is not paid on the documents to be issued.
• Customs duty is not paid for imported products within the scope of R & D projects.
- Interest Rate Support:
Interest rate support is a financing support provided for at least one term investment loans. A certain portion of the interest/dividend payable on the loan used up to 70% of the fixed investment amount registered in the investment incentive document is covered by the state, provided that it is paid for the first five years at most.
- Land Allocation:
For investments to be made, investment land is allocated depending on the availability of land in accordance with the regulations of the Ministry of Finance.