Payroll Compliance Updates-Turkey
A. Update

Severance payment is exempted from the income tax based on the yearly capped amount by multiplying the individual’s number of employment years in a company. This capped amount has increased to 7117.17 TRY from 6739.86 TRY.

B. Statutory Compliance Release Date: July 06, 2020
C. Effective Date: July 01, 2020
A. Update

The government of Turkey has introduced a new tax declaration process which combines both tax and social security information (SSI). The new declaration process was first announced in 2016 but its introduction was pushed back before it will eventually be implemented on March 01,  2020. The declaration form shall be filed electronically and there is an excel upload form available. Due to COVID-19 pandemic the declaration form was eventually implemented from August 26, 2020.

B. Statutory Compliance Release Date: February 09, 2020
C. Effective Date: August 26, 2020
A. Update

1. On December 27, 2019, General Communiqué No. 310 on the Personal Income Tax Law (the Communiqué) was published in the second edition of the Official Gazette.

2. The Communiqué updated certain amounts and the income tax tables relating to the Personal Income Tax Law for 2020 based on the revaluation rate (22.58%) determined for tax year 2019. The tax table applicable to employment income in 2020 is as follows:

Taxable Income (TRY) Tax on Lower amount (TRY) Rate on excess (%)
0 – 22,000 0 15%
22,000 – 49,000 3,300 20%
49,000 – 180,000 8,700 27%
180,000 – 600,000 44,070 35%
Over 600,000 191,070 40%

3. The Disability threshold amounts have increased to the following:

Degree Amount (TRY) Disability (%)
1 st Degree 1,400 80
2 nd Degree 790 60
3 rd Degree 350 40

4. The exemption value for travel within Turkey has been increased from TRY 61.5 to TRY 66.85 and Meal allowance in Kind has increased from TRY 19 to TRY 23/ day.

5. The Maximum ceiling amount for social security is TRY 22,075.50.

6. The Minimum Living Allowance (Substance allowance) has increased as follows for the year 2020:

Marital Status Monthly (TRY) Marital Status Monthly (TRY)
Single 220.73 - -
Married (spouse unemployed) and without children 264.87 Married (spouse employed) and without children 220.73
Married (spouse unemployed) and 1 child 297.98 Married (spouse employed) and 1 child 253.83
Married (spouse unemployed) and 2 children 331.09 Married (spouse employed) and 2 children 286.94
Married (spouse unemployed) and 3 children 375.23 Married (spouse employed) and 3 children 331.09
Married (spouse unemployed) and 4 children 375.23 Married (spouse employed) and 4 children 353.16
Married (spouse unemployed) and 5 children 375.23 Married (spouse employed) and 5 children 375.23

7. The severance pay threshold amount has changed from January 01, 2020 to TRY 6,739.86 from TRY 6,379.86.

B. Statutory Compliance Release Date: December 27, 2019
C. Effective Date: January 01, 2020
A. Update

Minimum Wage Determination Committee has set the monthly gross amounts of minimum wages at TRY 2,943 for the period January 01, 2020 through December 31, 2020.

Accordingly, the monthly cost of a single employee earning a minimum wage for the employer will be TRY 3,458.03

This will impact the social security calculation.

B. Statutory Compliance Release Date: December 27, 2019
C. Effective Date: January 01, 2020

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