VAT withholding (KDV tevkifatı) means the buyer deducts part of the VAT the seller should collect and pays it directly to the tax office, reducing the risk of sellers who collect VAT but do not pay it over. Rates are expressed as tenths: 5/10 means the buyer pays half of the VAT.
An example: who pays what?
A business buys cleaning services for TRY 100,000 excluding VAT. VAT 20% = TRY 20,000; the withholding rate for cleaning is 9/10.
| Amount | Who pays / declares? | |
|---|---|---|
| Service fee | TRY 100,000 | Buyer pays the seller |
| VAT calculated | TRY 20,000 | |
| VAT withheld (9/10) | TRY 18,000 | Buyer declares and pays on VAT return No. 2 and deducts the same amount on return No. 1 |
| VAT paid to the seller (1/10) | TRY 2,000 | Seller collects and declares on its return No. 1 |
| Total paid to the seller | TRY 102,000 |
As the seller cannot offset its input VAT, it may accumulate VAT carried forward, which can be claimed as a refund arising from withholding. Details: VAT refund guide. Calculator: VAT calculator.
TRY 12,000 threshold
Partial withholding applies when the transaction exceeds TRY 12,000 including VAT (the 2026 invoice threshold). Splitting a transaction to stay below it does not remove the obligation.
Partial withholding table
Designated buyers: public bodies, municipalities, revolving-fund institutions, professional bodies, banks, insurers, trade unions, foundation universities, state enterprises, organised industrial zones, companies listed on Borsa Istanbul and similar. VAT payers: all buyers registered for VAT.
| Transaction | Rate | Applied by |
|---|---|---|
| Construction works and related engineering, architecture and design services | 4/10 | Designated buyers (all VAT payers for works over TRY 5 million) |
| Studies, plans, projects, consultancy, audit and similar | 9/10 | Designated buyers |
| Alteration, maintenance and repair of machinery, equipment, fixtures and vehicles | 7/10 | Designated buyers |
| Catering and organisation services | 5/10 | Designated buyers |
| Labour supply services | 9/10 | VAT payers and designated buyers |
| Building inspection services | 9/10 | VAT payers and designated buyers |
| Contract textile, garment, bag and shoe sewing | 7/10 | VAT payers and designated buyers |
| Bringing customers to tourist shops | 9/10 | VAT payers |
| Broadcasting, advertising and naming rights of sports clubs | 9/10 | VAT payers and designated buyers |
| Cleaning, environmental and garden maintenance | 9/10 | VAT payers and designated buyers |
| Staff transport services | 5/10 | VAT payers and designated buyers |
| Road freight transport | 2/10 | VAT payers and designated buyers |
| Printing services of all kinds | 7/10 | Designated buyers |
| Commercial advertising services | 3/10 | VAT payers and designated buyers |
| Metal ingots | 7/10 | VAT payers and designated buyers |
| Copper, zinc, aluminium and lead products | 7/10 | VAT payers and designated buyers |
| Scrap and waste | 7/10 | VAT payers and designated buyers |
| Raw materials from metal, plastic, paper and glass scrap | 9/10 | VAT payers and designated buyers |
| Cotton, mohair, wool, raw hides and leather | 9/10 | VAT payers and designated buyers |
| Timber and forest products | 5/10 | VAT payers and designated buyers |
| Iron and steel products | 5/10 | VAT payers and designated buyers |
| Other services to designated buyers not listed above | 5/10 | Designated buyers |
Withholding on freelance receipts
For consultancy and audit services supplied by accountants, lawyers, engineers and other professionals to designated buyers, 9/10 of the VAT is withheld. Ordinary services to private companies carry no VAT withholding, only income tax withholding. Difference between the two: Withholding vs VAT withholding. Calculator: Freelance receipt.
Full withholding (reverse charge)
For services bought from abroad (e.g. foreign software licences, advertising) the buyer calculates all of the VAT and declares it on VAT return No. 2 (as the liable party). For example, for USD 1,000 of digital advertising bought from abroad, the Turkish buyer declares the 20% VAT and deducts it in the same month.
Source
VAT Law art. 9; VAT General Implementation Communiqué sections I/C-2.1.3 (partial) and I/C-2.1.2 (full withholding), as amended.