Income Tax Tariffs Announced

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In Turkey, income tax rates are applied progressively by taking into consideration the yearly cumulative income tax base. As a result, income tax rate may vary from month to month during the year.

There are 4 different income sections (tax brackets) to which different tax rates are applied. Also, these sections may be different for the wages (salaries) and other types of income.

As per Income Tax General Communique Serial No. 35 issued in Official Gazette on 31 January 2018 taxable income brackets and the rates are as below:

TAXABLE INCOME                                     TAX RATE

Up to 18,000                                                                            15%

For the 18,000 of 40,000, the tax is 2,700 TRY in excess                 20%

For the 40,000 of 148,000, the tax is 7,100,

(For the 40,000 of 98,000 in other incomes 7,100 in excess            27%

For the 148,000 of income over 148,000, the tax is 36,260,

(For the 98,000 TRY of income over 98,000, the tax is 22,760 in excess          35%

 

We can simply show the tax rates applied to employee’s income (salary) in the table below:

1st Income Bracket 15%

0 – 18,000

2nd Income Bracket 20%

18,000 – 40,000

3rd Income Bracket 27%

40,000 – 148,000

4th Income Bracket 35%

148,000+

 

INCOME TAX OF MINIMUM WAGE

As the income tax rates are progressive and yearly cumulative income is taken as a base, after September, minimum wage earner’s net base monthly salary may get lower than the one announced as 2020,91,  due to the shift into the upper section (%20). In order to prevent this decrease, minimum wage earners will get ML (Minimum Living Allowance) support to maintain the net amount they are receiving.

An employee may have additional payments such as meal allowance, transportation pay, bonus etc. and their payments can be over 2020,91 (Base salary + Additional payments). In the application of MLA support additional payments are not taken into consideration and only the employees’ base salary (2020,91) is protected.  

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