Depreciation methods: straight-line, declining balance and passenger cars
Depreciation under the Tax Procedure Law: which assets are depreciable, the direct expense limit, useful life, straight-line and declining-balance methods, pro-rata depreciation, passenger car limits and changing method.
When a business buys a computer, machine or vehicle, the whole cost is not expensed that year; it is spread over the years the asset will be used through depreciation. The method you choose changes the year in which the expense falls and therefore when tax is paid.
Which assets are depreciable?
Real estate, machinery and plant, vehicles, fixtures and rights used in the business for more than one year and subject to wear, tear or loss of value are depreciable. Land is not depreciable.
Direct expense option: key money, intangible rights and fixtures costing no more than TRY 12,000 in 2026 can be expensed directly without depreciation.
Useful life and rate
Depreciation rates are set by asset type in the depreciation rate table published by the Revenue Administration: for example personal computers 4 years (25%), software 3 years (33.33%), furniture 5 years (20%). You can search the whole table: Useful life list
Straight-line (equal) depreciation
The cost of the asset is spread evenly over its useful life. For a TRY 100,000 computer, TRY 25,000 depreciation is taken each year.
Declining-balance method
Those keeping balance-sheet books can choose this method. Twice the normal rate (at most 50%) is applied, and the rate is applied each year to the remaining value. In the final year the whole remaining value is expensed.
| Year | Straight-line (25%) | Declining balance (50%) |
|---|---|---|
| 1 | 25,000 | 50,000 |
| 2 | 25,000 | 25,000 |
| 3 | 25,000 | 12,500 |
| 4 | 25,000 | 12,500 |
| Total | 100,000 | 100,000 |
The total expense is the same; by expensing more in the early years, declining balance pushes tax later, not earlier. Switching from declining balance to straight-line is possible; the reverse is not. With your own figures: Depreciation calculator
Pro-rata depreciation
As a general rule, depreciation is taken for a full year in the year the asset is acquired; no monthly calculation is made. Passenger cars are the exception: in the year of acquisition depreciation is taken by month (pro rata), and the remainder is added to the final year.
Passenger cars
The amount that can be depreciated for passenger cars is capped. For 2026 the cap is TRY 1,380,000 on the price excluding SCT and VAT; where SCT and VAT are added to cost (for example on second-hand purchases), the cap is TRY 2,600,000. Depreciation on the part above the cap is a non-deductible expense. In addition, only 70% of passenger car expenses can be deducted. Calculation: Passenger car depreciation · Buying a car through the company
Points to watch
- The right to depreciate is lost if not used. If you take no depreciation in a year, you cannot make up that year's share in later years.
- The method is chosen asset by asset and applied consistently.
- For an asset sold, the difference between the remaining net value and the sale price is a profit or loss.
- Revaluation: in periods without inflation adjustment, depreciable assets can be revalued: Inflation adjustment 2026
- Commercial balance sheet: in companies reporting under TFRS, the economic life may differ from the tax table; the difference is tracked as deferred tax.
Legal basis: Tax Procedure Law No. 213 arts. 313–321; Tax Procedure Law General Communiqués No. 333, 339, 365 and 576.