Withholding (stopaj) means the payer deducts the tax on the recipient's income at source and pays it to the tax office. The recipient bears the tax economically; the payer is liable to deduct and pay it over. If the recipient files an annual return, the withheld tax is credited against the tax calculated — it is a form of prepayment.
Withholding tax and VAT withholding are different: the first is income or corporate tax deducted at source; the second is part of the VAT being paid by the buyer. Detailed comparison: Withholding vs VAT withholding.
Who must withhold?
Public bodies, businesses keeping balance-sheet or operating-account books, professionals, companies, farmers who keep books and similar persons are tax withholding agents under Income Tax Law art. 94. An individual (for example an employee renting out their flat) paying rent to another individual does not withhold.
Income tax withholding rates (ITL art. 94)
| Payment | Rate | Who withholds? | Note |
|---|---|---|---|
| Wages paid to employees | Income tax tariff (15%–40%) | Employer | The minimum-wage part is exempt. Salary calculator |
| Professional fees (accountant, lawyer, doctor, architect…) | 20% | Paying business | Freelance receipt |
| Copyright income (authors, composers) | 17% | Paying business | |
| Commercial rent (individual landlord) | 20% | Tenant business | Rent withholding |
| Multi-year construction and repair progress payments | 5% | Payer | Including payments to companies |
| Dividends to resident individuals and non-residents | 15% | Distributing company | From 22.12.2024. Dividend tax · Dividend calculator |
| Purchases of agricultural products (from farmers) | 2% (1% for livestock and animal products) | Buying business | 1% / 0.5% if sold on an exchange |
| Agricultural services | 2% | Buying business | |
| Payments to persons under the tradesman exemption | 2% | Buying business | |
| Deposit interest, repo, lease certificate returns | Varies by term and instrument | Bank / intermediary | Set by Presidential Decision |
Gross-to-net or net-to-gross: Withholding tax calculator
Corporate tax withholding (CTL arts. 15, 30)
Withholding on payments to companies is limited. Main cases: multi-year construction progress payments (5%), professional fees, rent and licence fees paid to non-resident companies (around 20%, possibly reduced by a tax treaty), and dividends to non-resident companies (15%). Premises rented from a resident company are not subject to withholding; the company adds VAT to the rent invoice.
Who pays, who pays over, who credits?
Example: commercial rent. A limited company rents premises from an individual for TRY 30,000 gross a month.
| Step | What happens? |
|---|---|
| Tenant (company) | Pays TRY 24,000 to the landlord, withholds TRY 6,000 |
| Tenant (company) | Pays the TRY 6,000 via the withholding return by the 26th of the following month |
| Tenant (company) | Records TRY 30,000 as expense |
| Landlord (individual) | Files an annual return in March; credits the TRY 72,000 withheld during the year against the tax on TRY 360,000 gross rent |
Example: freelance receipt. An accountant invoices a company TRY 20,000 gross + VAT. The company withholds TRY 4,000 and pays TRY 16,000 + TRY 4,000 VAT = TRY 20,000. The company pays the withholding via its withholding return; the accountant pays the VAT on their own return.
Stamp duty (Law No. 488)
| Document | Rate |
|---|---|
| Wages, salaries and compensation (including severance and notice pay) | 0.759% |
| Contracts with a stated amount | 0.948% (leases 0.189%) |
| Balance sheet | Fixed amount, reset every year |
Stamp duty on the minimum wage is exempt (TRY 250.70 a month in 2026). All rates and fixed amounts: Stamp duty calculator.
When to pay
Withholdings are declared and paid on the monthly withholding and premium return by the 26th of the month after payment. Tax calendar.