The services to be provided by the foreign taxpayer institution regarding oil exploration activities are within the scope of self-employment activity and the payments made in return for the expenses shall be accepted as self-employment payment to the limited taxpayer.
Within this framework, followings are realized;
– If the activities are carrying out within the scope of commercial activities by having a permanent workplace or permanent representative in Turkey, corporation tax will not be deducted from payments and the income will be taxed under the commercial income provisions according to our internal legislation.
– 5% corporate tax must be deducted from all payments made if the activities are carried out without having a workplace or permanent representative in Turkey or without the connection with commercial activity carried out in those workplaces even if they have a workplace or permanent representative in Turkey, pursuant to Article 30/1-b of the Corporate Tax Law and in accordance with the Decisions of the Council of Ministers numbered 2009/14593.
On the other hand, if there is an agreement on prevention of double taxation between the country where the limited taxpayer served as self-employed is located and Turkey, the provisions of this agreement will be considered for the tax deduction.
Source: GİB
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.
