Who Can Use the 95% Corporate Tax Base Deduction for Transit Trade in Türkiye?

A company subject to corporate tax (kurumlar vergisi) in Türkiye may deduct 95% of the profit it earns from two activities from its corporate income (kurum kazancı): selling goods abroad that it bought abroad without bringing them into Türkiye, and acting as an intermediary in sales of goods between parties outside Türkiye (KVK m. 10/1-i). The deduction is not calculated on total revenue: its basis is the in-scope profit remaining after the costs and expenses relating to these activities are deducted from their revenue. This provision was rewritten by Law No. 7582 and applies to profits of accounting periods beginning on or after 1 January 2026. The first application will therefore be in the corporate tax return (kurumlar vergisi beyannamesi) for the 2026 calendar year, to be filed in 2027. The rate is 100% for entities operating in industrial zones (endüstri bölgeleri) approved by the President, or in the Istanbul Financial Centre (İstanbul Finans Merkezi) with a participant certificate (katılımcı belgesi). For both rates, the profit must be transferred to Türkiye by the date on which the annual corporate tax return for the accounting period in which it was earned must be filed.

Legal Basis and Nature of the Provision

The deduction is set out in sub-paragraph (i) of the first paragraph of Article 10, headed “Other deductions” (Diğer indirimler), of Corporate Tax Law No. 5520 (Kurumlar Vergisi Kanunu, KVK). The sub-paragraph was first added by Law No. 7421. Article 7 of Law No. 7582 on Amendments to Certain Laws (Bazı Kanunlarda Değişiklik Yapılmasına Dair Kanun), dated 21 May 2026, then replaced it in full. This law was published in the Official Gazette (Resmî Gazete) No. 33270 of 4 June 2026.

Technically, the provision is a profit deduction. In other words, it is designed not as an exemption that takes the income out of the scope of tax, but as a deduction from corporate income. In practice, the result is a tax base deduction (matrah indirimi): 95% of the profit is shown as a deduction in the return, and the remaining 5% is taxed at the general corporate tax rate. The general corporate tax rate is 25% (KVK m. 32/1).

The details of application are explained in the Communiqué Amending the Corporate Tax General Communiqué (Serial No: 1) (Kurumlar Vergisi Genel Tebliği (Seri No: 1)’de Değişiklik Yapılmasına Dair Tebliğ (Seri No: 26)), Serial No: 26. This communiqué was published in the Official Gazette No. 33300 of 4 July 2026, and the explanations are in Section 10.7 of Communiqué Serial No: 1.

Activities Covered by the Deduction

The law lists two types of activity (KVK m. 10/1-i; Tebliğ 10.7.1):

• Transit trade: Goods bought abroad are sold abroad without being brought into Türkiye. Example: the company in Türkiye buys goods from a manufacturer in Germany, and the goods are shipped directly to the buyer in France.
• Intermediation: Acting as an intermediary in purchases and sales of goods that take place abroad. Example: the company in Türkiye acts as an intermediary in a sale between a seller in Italy and a buyer in Egypt and receives a commission.

According to the communiqué, the scope also includes the following transactions, subject to certain conditions (Tebliğ 10.7.1):

• Goods in a customs warehouse: Goods may be brought into Türkiye and stored in a customs warehouse (gümrüklü antrepo). If they are sold to a buyer abroad without being released for free circulation and without undergoing any processing, the deduction applies. If goods in the warehouse are sold to a buyer in Türkiye or released for free circulation, the deduction cannot be used.
• Digital codes: Activation codes, e-pins, game codes, licence codes, subscription codes and similar items bought abroad are covered. Their nature must not be changed, they must not be used in Türkiye or sold to persons in Türkiye, and they must be sold directly to persons resident abroad. Values that do not represent a specific product or service and serve as a means of payment, such as balances, wallet codes and gift cards, are outside the scope.
• Intangible rights: Copyrights, trademarks, patents, licences and similar rights bought abroad are also covered. They must be sold directly to persons resident abroad without being changed and without being used in Türkiye, or the company must act as an intermediary in such sales. After the sale, the seller must retain no power of disposal over the right.

If the goods are first brought into Türkiye and then sold abroad (other than under the customs warehouse exception), the deduction does not apply (Tebliğ 10.7.1, Example 1).

Who Can Benefit?

The text of the law defines the beneficiaries of the deduction as “entities” (kurumlar). It does not impose any further limit such as “resident in Türkiye” or “full taxpayer” (tam mükellef). For companies with foreign shareholders, the position is as follows:

• A limited company or joint stock company incorporated in Türkiye is subject to corporate tax even if all of its shareholders are foreign. If it meets the conditions, it can benefit from the deduction.
• There is no condition tied to any line of business or minimum capital. For the 100% rate, however, an additional condition applies: the company must either operate in an industrial zone approved by the President or hold an Istanbul Financial Centre participant certificate under Law No. 7412.
• The Turkish branch of a foreign company (a limited taxpayer’s (dar mükellef) place of business) is not addressed separately in the text of the law. The communiqué does not provide any explanation on this point either. If planning is to be done with a branch structure, this point should be assessed separately.

Investors considering setting up a new company in Türkiye for transit trade can refer to our page on company formation with foreign shareholders for company types and formation steps.

Conditions for the Deduction

Under the law and the communiqué, the following conditions must all be met (KVK m. 10/1-i; Tebliğ 10.7.1, 10.7.2.2):

1. Activity condition: The profit must be derived from the transit trade or intermediation activity described above.
2. Parties not in Türkiye: The seller and buyer of the goods subject to the intermediation activity must not be in Türkiye. If either party is in Türkiye, the deduction does not apply. In a transit sale, the goods must not be sold to a buyer in Türkiye either.
3. Transfer condition: The profit must be transferred to Türkiye by the date on which the annual corporate tax return for the accounting period in which it was earned must be filed.
4. Record-keeping condition: Revenue, costs and expenses within and outside the scope of the deduction must be tracked separately, must not be linked to each other, and the records must be kept so as to show this separation. For the organisation of books and documents, see our page on statutory books and e-Ledger.
5. Additional condition for the 100% rate: The company must hold a participant certificate in the Istanbul Financial Centre or operate in an industrial zone approved by the President.

Details of the Transfer Condition

According to the communiqué, these profits must be included in corporate income in the period in which they are earned. The deduction does not apply to the portion not transferred to Türkiye by the end of the filing period. Profit not transferred within this period cannot benefit from the deduction even if it is brought into Türkiye in later years (Tebliğ 10.7.1). In the case of a partial transfer, the deduction applies only to the portion transferred.

Under KVK m. 10/1-i, the last day for the transfer is the date on which the annual corporate tax return for the accounting period in which the profit was earned must be filed. This date is determined by looking at two separate rules:

• Text of the law: The corporate tax return is filed from the first day until the evening of the twenty-fifth day of the fourth month following the month in which the accounting period closes (KVK m. 14/3). On this wording, the last day for the 2026 calendar year would be 25 April 2027 (a Sunday).
• GİB’s general practice: The Revenue Administration (Gelir İdaresi Başkanlığı, GİB) is authorised to reset the last day of filing periods by up to one month from the statutory deadline (VUK mükerrer m. 28). Using this authority, Tax Procedure Law Circular No. 115 of 29.03.2019 (VUK-115/2019-5) extended the filing period for the corporate tax return “until a new determination is made” to the last day of the payment period, i.e. the last day of April for calendar-year taxpayers. This is how the filing period has been applied in recent years: according to GİB’s announcement, the return for the 2025 accounting period was filed between 1 and 30 April 2026; for the 2024 accounting period, the deadline of 30 April 2025 was further extended to 5 May 2025 by Circular No. 188.

As of 9 November 2026, GİB has published no announcement or circular specific to the 2027 filing season (2026 accounting period). If the general practice continues, the last day for filing the return for the 2026 calendar year, and therefore the last day for the transfer, will be 30 April 2027 (a Friday). If an additional extension is made by circular during the filing season, its effect on the transfer deadline should be assessed separately; completing the transfer by 30 April 2027 is the safer course. For entities with a special accounting period, the date is calculated from the month in which their own accounting period closes.

Calculating the Deduction Amount

The deduction is calculated on the profit obtained by deducting the expenses and costs incurred for the covered activities from the revenue of those activities (Tebliğ 10.7.2.1):

Rules to observe in the calculation (Tebliğ 10.7.2.1, 10.7.2.3):

• The deduction is shown in the section of the return headed “Exemptions and Deductions to Be Deducted if There Is Profit” (Kazancın Bulunması Halinde İndirilecek İstisna ve İndirimler).
• Any amount that cannot be deducted because of other deductions and exemptions or prior-year losses cannot be carried forward to later periods.
• If the activity results in a loss, there is no deduction.
• Interest earned on cash holdings, exchange differences arising from foreign currency valuation, gains on the sale of assets and extraordinary income cannot be treated as within the scope of the deduction.

The President is authorised to reduce the rates in the sub-paragraph to zero and to increase them up to 100% (KVK m. 10/1-i, last sentence). The rate applicable for each period should therefore be confirmed before filing by checking whether a Presidential Decision (Cumhurbaşkanı Kararı) has been published.

Interaction with the Domestic Minimum Corporate Tax

Corporate tax cannot be less than 10% of corporate income before deductions and exemptions (KVK m. 32/C-1). Article 9 of Law No. 7582 added the deduction in sub-paragraph 10/1-i to the deductions that may be deducted from the minimum corporate tax (asgari kurumlar vergisi) base (KVK m. 32/C-2-b; Tebliğ 32.5.5). As a result, the deduction granted for transit trade profit is not clawed back in the minimum tax calculation. Newly established entities are not subject to the minimum corporate tax for three accounting periods starting from the accounting period in which they commence activity (KVK m. 32/C-5).

The 5-Point Reduction for Export Profits

For exporting entities, the corporate tax rate is applied with a 5-point reduction to profits derived exclusively from exports (KVK m. 32/7). The communiqué states that profit from selling goods bought abroad to a customer in another country without the goods entering Türkiye may also benefit from this 5-point reduction (Tebliğ 32.1.2.5).

The communiqué contains a separate explanation for the service export deduction (KVK m. 10/1-ğ): no additional 5-point reduction is applied to the portion of profit that is deducted and left outside tax, and the 5-point reduction may be applied only to the remaining amount. The communiqué contains no direct explanation of how the 10/1-i deduction and the 5-point reduction are to be applied together. For this reason, the 5-point reduction has not been taken into account in the example below.

Calculation Example: 2026 Accounting Period

Assumptions:

• (A) Ltd. Şti., all of whose shareholders are resident in the Netherlands, operates in Istanbul. Its accounting period is the 2026 calendar year. The company is not an Istanbul Financial Centre participant and does not operate in an industrial zone.
• The company bought machine parts from a manufacturer in China and sold them to a buyer in Romania without bringing them into Türkiye. Revenue from these sales is TL 20,000,000, the cost of goods sold is TL 16,500,000, and expenses directly attributable to this activity are TL 1,500,000. Profit from the transit activity is TL 2,000,000.
• The company’s profit from consultancy services provided to customers in Türkiye is TL 1,000,000.
• There are no non-deductible expenses, no prior-year losses and no other deductions or exemptions. The company is in its fourth year of activity, so the minimum corporate tax applies. The 5-point export reduction has not been taken into account.
• The entire transit profit was transferred to a bank account in Türkiye before the date on which the return for the 2026 accounting period must be filed. If GİB’s general practice continues, this date is 30 April 2027.

1. Corporate income: 2,000,000 + 1,000,000 = TL 3,000,000
2. Transit trade deduction: 2,000,000 × 95% = TL 1,900,000
3. Corporate tax base: 3,000,000 − 1,900,000 = TL 1,100,000
4. Calculated corporate tax: 1,100,000 × 25% = TL 275,000
5. Minimum corporate tax check: (3,000,000 − 1,900,000) × 10% = TL 110,000. As this amount is lower than TL 275,000, the calculated tax is TL 275,000. Advance tax (geçici vergi) paid during the period is offset against this amount.
6. Comparison: Without the deduction, the tax would be 3,000,000 × 25% = TL 750,000. The tax attributable to the transit profit is 2,000,000 × 5% × 25% = TL 25,000. This corresponds to 1.25% of the transit profit. This percentage holds only under the assumptions of this example: the deduction is used in full, the 95% rate is not changed, and there is no 5-point export reduction, no prior-year loss and no other deduction or exemption. If any of these assumptions changes, the result may change as well.

Partial transfer variant: Assume that only TL 1,500,000 of the transit profit was transferred to Türkiye within the filing period.

1. Deduction: 1,500,000 × 95% = TL 1,425,000
2. Tax base: 3,000,000 − 1,425,000 = TL 1,575,000
3. Corporate tax: 1,575,000 × 25% = TL 393,750

Even if the TL 500,000 not transferred is brought into Türkiye later, it cannot be deducted for the 2026 period.

If corporate profit is distributed to shareholders, the dividend may be subject to a separate withholding tax. For foreign shareholders, this topic is covered in our article on dividend withholding tax for non-resident shareholders.

Entry into Force and Application Timeline

For entities with a special accounting period (özel hesap dönemi), the first special accounting period beginning on or after 1 January 2026 is taken as the basis.

Practical Checklist

• Do the contracts, invoices, bills of lading or transport documents show that the goods were not brought into Türkiye or, if they were, that they remained only in a customs warehouse?
• Can it be documented that the seller and the buyer are outside Türkiye?
• Are the revenue, costs and expenses of the transit activity tracked in separate accounts?
• Were the collections transferred to Türkiye before the filing period expired, and can the transfer be shown by bank records?
• If the buyer or seller is a related party of the company, were the prices set in line with the transfer pricing rules (KVK m. 13)?
• Has a Presidential Decision changing the rate been published before filing?

For preparing the return, see our page on preparation of tax returns. For international structures, our page on international tax consultancy may be useful. For your company’s specific situation, you can write to us through our contact page.

Last legislation check: 9 November 2026 · Period covered: 2026 accounting period (return to be filed in 2027)