Corporate Income Tax Rate is Increased For FY2021 and FY2022

The Law on the Amendment of Law on the Procedure for the Collection of Public Receivables and Certain Laws no 7316 has been published in the official gazette 22^nd of April 2021. According to article 11 of said law, the provisional article 13 is added to CIT Law No 5520, which determines the new corporate income tax rates for FY2021 and FY2022.

According to said provisional article, corporate income tax rate will be 25% for FY2021 and 23% for FY2022. According to article 14 of law no 7316, these rates will be effective from FY2021 and for declarations made after 01/07/2021.

As it is known, Corporate Income Tax Rate in Turkey is 20% and it was temporarily increased to 22% for FY2018, FY2019, and FY2020. In this sense, effective from 01.01.2021, the declarations made before 01/07/2021 will be subject to 20% standard CIT Rate.

In other words, 20% CIT rate will be applied for first advance tax period of FY2021 while 25% CIT rate will be applied for other advance tax periods for FY2021. Accordingly, said tax rates are summarized in the table below:

Please note that 25% CIT rate will be applied for cumulative tax base for FY2021 although 20% CIT rate will be applied for first advance tax period of FY2021.

Kind Regards.