Technopark and R&D centre incentives: which suits you?
Technopark advantages under Law No. 4691 and R&D centre, design centre and project-based R&D incentives under Law No. 5746: income exemption, staff wage exemption, SGK support, stamp duty and VAT; conditions, comparison and documentation.
For companies developing software, designing a new product or renewing a production process, Türkiye has two main incentive regimes: technology development zones (technoparks) and R&D and design centres. Both offer significant tax advantages; but their conditions and workings differ.
Comparison
| Technopark (4691) | R&D / design centre (5746) | |
|---|---|---|
| Where? | Within technopark boundaries, in space rented from the managing company | At the company's own premises |
| For whom? | Ventures of any size; especially software and technology companies | Companies with a certain number of full-time R&D or design staff |
| Income | Income from software and R&D activities is exempt from corporate tax until the end of the period in the Law | All R&D and design expenditure can be deducted from corporate income (R&D deduction) |
| Staff wages | Wages of R&D, design and support staff are exempt from income tax (within limits) | Income tax exemption on the wages of R&D and design staff according to education level |
| SGK | Half of the employer share is covered by the Treasury | Half of the employer share is covered by the Treasury |
| Stamp duty | Exemption for staff wages and documents relating to the activity | Exemption for documents relating to R&D and design activities |
| VAT | Certain software supplies produced in the zone are exempt | Exemption possibilities under certain conditions |
| Customs | Certain exemptions on imports | Certain exemptions on imports |
The rate and time limits of the exemptions and deductions are updated by amendments to the Law. Let us review the current text together before applying.
Points to watch in a technopark
- Carrying out the activity in the zone: the exemption applies only to income from activities carried out within the technopark and based on approved projects. Working outside the zone is possible within certain limits and conditions.
- Project approval: R&D or software projects must be approved by the technopark managing company.
- Separate records: income and expenses of activities inside and outside the technopark must be tracked separately.
- Staff: staff benefiting from the exemption must work in the zone and be assigned to the project; the number of support staff is limited.
- Use of the income: if exempt income is distributed to partners, dividend withholding is assessed separately: Dividend distribution
Points to watch in R&D and design centres
- Certificate: an R&D or design centre certificate is obtained by applying to the Ministry of Industry and Technology. The minimum number of full-time equivalent staff set in the Law is required.
- Project-based R&D: companies without a centre certificate can also use the R&D deduction for projects such as TÜBİTAK or other publicly supported projects.
- If the R&D deduction cannot be used in loss-making years, it can be carried forward to later years.
- Minimum corporate tax: the R&D and design deduction and the technopark income exemption are among the items that can also be deducted from the minimum corporate tax base: Domestic minimum corporate tax
Payroll practice
Under both regimes, the exemption on staff wages and the SGK support are reflected in the payroll. Documenting the days and hours within the exemption with timesheets is critical in audits. The SGK support is declared on the premium document with the relevant law number. For payroll calculation: Salary calculator
Which route suits you?
- Early-stage software venture: a technopark is usually the most advantageous start.
- Manufacturing company doing R&D at its own facility: an R&D or design centre.
- Company with specific projects but not yet large enough for a centre: the project-based R&D deduction.
When choosing, look not only at the tax advantage but also at rent cost, where staff will work, the reporting burden and the company's growth plan. For other support: KOSGEB support
Our related service: Incentives and regions
Legal basis: Technology Development Zones Law No. 4691 arts. 8, 9 and provisional art. 2; Law No. 5746 on Supporting Research, Development and Design Activities art. 3; Corporate Tax Law No. 5520 art. 10/1-a.