What Expenses Can Companies in Turkey Deduct?

In today’s article, I’ll explain which expenses can be deducted by companies in Turkey. While this may not be a common question during the company formation process, it’s frequently asked once the business is up and running: What expenses can I deduct? How can I reduce my tax burden? These are popular questions, especially for new entrepreneurs in Turkey, and we will cover them in detail.

Company Establishment Costs in Turkey

Establishment costs include the expenses incurred before the company is officially established. These costs can be recorded in the accounting books within 10 days after the company's formation.

For example, if expenses such as office rent or material purchases were made before the company was registered, you can submit the invoices to your accountant to have them recorded.

Office Furniture & Equipment

Items used in the office, such as desks, chairs, and computers, can be recorded as expenses. However, for products over 1,500 TL, depreciation needs to be applied according to Turkish tax regulations.

For instance, if you purchase a computer for 10,000 TL, this amount will be depreciated over 4 years (the product's lifespan, which varies for different items) and 2,500 TL will be deducted as an expense each year.

Additionally, consumables like tea and coffee used in the office can be recorded as deductible expenses.

Car Rental Expenses in Turkey

The cost of renting a passenger car can be deducted up to 6,000 TL per month. Any amount above this will be considered a non-deductible expense according to Turkish tax law.

Moreover, 70% of maintenance, repair, and fuel costs of the vehicle can be deducted.

Personnel Expenses in Turkey

Work-related travel expenses can be recorded as deductible expenses, provided that the trip is directly related to the nature of the business. For example, costs such as hotel stays and airfare for a business trip can be deducted.

Office Bills & Rent Costs in Turkey

At the company’s registered office address, expenses like electricity, water, natural gas, and telephone bills can be recorded as business expenses. For those working from a home office in Turkey, 50% of these bills can be deducted.

Representation and Hospitality Expenses in Turkey

Expenses incurred while entertaining clients, such as taking them out for a business meal, can be deducted as representation and hospitality expenses. However, alcohol-related expenses are not considered deductible under Turkish tax regulations.

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