Legal News

R&D - Innovation - Design Expenditures Subject To Discount In Determination Of Earnings

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New arrangements has been introduced into Article 3 of Law on Supporting Research and Development Activities No. 5746, which set forth the discount, exception, support and incentives in R&D and design centers and activities.

According to Cabinet Decree No. 2016/9092, issued in Official Gazette dated 10 August 2016, numbered 29797:

In R&D and design centers, which provided at least 20% increase in any of the following indicators; 50% of the increase in current year’s R&D and innovation or design expenditures compared to previous years, will be subject to discount in the determination of corporation earnings until 31 December 2023, as per article 10 of the Corporation Tax Law no 5520, and in the determination of commercial earnings as per article 89 of the Income Tax Law no 193;

Fields of Design Activities Within Nace Codes

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As part of a reform package, the Cabinet Decree No. 2016/9094 has been issued in Official Gazette dated 11 August 2016, numbered 29798, intended to include some innovative works, which are defined in Statistical Classification of Economic Activities in the European Community, Rev. 2 (NACE), within the "scope of design activities."

According to above mentioned Cabinet Decree, all innovative activities which; have the potential of creating added value and competitive advantage, and have the quality of increasing, developing, improving and diversifying the functionality of a product or/and products in the following fields specified Statistical Classification of Economic Activities in the European Community, (NACE Rev. 2) will be considered as design activity.

Activities Not Considered As R&D And Design Activity In Turkey

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In the first three article of our bulletin confined to substantial amendments in the field of R&D support, we provided the areas, activities and establishments that will be benefitting from the incentives and supports.

However, article 5 and 6 of the Regulation on Application and Control for Supporting Research, Development and Design Activities, which has been issued in Official Gazette dated 10 August 2016 numbered 29797, also specifies the activities that are not deemed as R&D and "design" activity.

Turkey Bans Bankruptcy Adjournment During State Of Emergency

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turkey-bans-bankruptcy-adjournment-during-state-of-emergencyCorporations and cooperatives in Turkey will have no right to demand postponement of bankruptcy during the state of emergency, declared as of 21 July 2016 for three months.

We have informed you that the state of emergency gives the government enhanced powers in every area; and that financial, material and labor obligations may be imposed on citizens within this period.

All claims of bankruptcy adjournments, which are being a controversial issue recently, are banned until the end of state of emergency period by Decree Number 669, dated 25 July 2016, issued according to  State of Emergency Law No. 2935, which reads as follows;

Turkey's New Private Pension System Is On The Way

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turkey-s-new-private-pension-system-is-on-the-wayVoluntary private pension system is about to be replaced by a mandatory private pension scheme, which stipulates that, every wage-earner Turkish citizens under 45 years of age will be automatically enrolled in a pension plan determined by employers.

A long-awaited "Draft Amending the Law on Individual Pension Savings and Investment System" which is being discussed in Parliament's Plan and Budget Commission and expected to be in force soon, aims to improve the welfare level of employees by providing a supplementary income during retirement, and to increase the domestic savings crucial for preventing the fragility of Turkish economy.

Public Receivables Will Be Restructed In Turkey

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Many of the unpaid debts and administrative penalties, accrued before 30 June 2016, related to taxes and tax penalties, customs duties, and public receivables such as social security premiums, group insurance premium, unemployment premiums, social security support contribution, general health insurance, as well as any kind of subsidiary public receivables such as interest, penalties, late fee or default interests applied to them will be restructured.

According to Government Bill of Law on Restructuring Some Receivables accepted in Parliament 3 August 2016, debtors will only pay the principal debts; and accessory receivables such as delay penalty and default interest related to these principal receivables will not be collected.

Instead of above mentioned accessory receivables, the amount to be calculated on the basis of the monthly change ratio of Domestic Producer Price Index (Domestic PPI) will be paid within the determined time and way.

No Fines For Not Hiring Workplace Doctor Until End Of The Year

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no-fines-for-not-hiring-workplace-doctor-until-end-of-the-yearThe obligation as regard to employing occupational safety specialist and workplace doctor (occupational physician) came into effect as of July 1, 2016, however no administrative fines will be imposed for violation of these obligation until the end of 2016, as Labor and Social Security Minister  Soylu announced in a press conference.

Many of the provisions set forth in the "LAW ON OCCUPATIONAL HEALTH AND SAFETY NO. 6331" had entered into force as of December 30, 2012 for workplaces with 50 or more personnel which engage in heavy duty and hazardous operations, but the effective dates of article 6 and 7 that include the obligation of appointing or hiring occupational safety specialist and workplace doctor for every private establishments (including establishments with less than 50 personnel and/or in the scope of less hazard class) had been postponed to July 1, 2016 and now these articles is in effect.

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