Domestic Minimum Corporate Tax Example-6

  • Commercial balance sheet profit,
  • Non-deductible expenses (KKEG),
  • Income from exports subject to a 5-point reduced rate according to relevant provisions,
  • Exempt income from a branch operating in a free zone,
  • Exempt capital gains from the sale of industrial property rights,
  • Cash capital interest deduction,

if applicable.

Example 6:
(F) A.Ş.’s commercial balance sheet profit for the 2025 fiscal period is 10,000,000 TL, with non-deductible expenses totaling 1,000,000 TL. The company’s export income, subject to a 5-point reduced rate as per relevant provisions, is 2,000,000 TL. Additionally, the exempt income from its branch operating in a free zone is 1,000,000 TL, and the exempt capital gains from the sale of industrial property rights amount to 4,000,000 TL. The company has also deducted 2,000,000 TL as a cash capital interest deduction from its tax base.

Accordingly, the minimum corporate tax for this institution will be calculated as follows.

Corporate Tax Minimum Corporate Tax
Commercial Balance Sheet Profit (a) 10,000,000 10,000,000
Non-Tax-Deductible (KKEG) (b) 1,000,000 1,000,000
Deductions 5,000,000 1,000,000
– Free zone income exemption (c) (c+ç) (c)
– Industrial property rights income exemption (ç) (c+ç) (c)
– Cash capital deduction 2,000,000 TL (d) 2.000.000

(d)

 0
Corporation tax base [(a+b)-(c+c+d)] 4.000.000 [(a+b)-c]

10.000.000
Tax calculated on export income at a reduced rate of 5% (e) (2,000,000 x %20)=400.000
Tax not taken due to the export ratio deduction (f) (2,000,000 x %5)= 100.000
Tax calculated on the base subject to the general rate (g) (2,000,000 x %25)= 500.000
Calculated corporation tax (e+g)

900.000

 (10.000.000 x 10%) -f= 900.000
Corporation tax to be paid 900

The minimum corporate tax for (F) A.Ş. is calculated as 1,000,000 TL. After deducting 100,000 TL in tax, which is the amount not taken due to the 5-point reduction granted under Article 32(7) of Law No. 5520 to exporting companies, the minimum corporate tax is determined to be 900,000 TL. In this case, since the calculated corporate tax for (F) A.Ş. is equal to the minimum corporate tax, the calculated corporate tax will be 900,000 TL.

Source: Corporate Tax Law Communiqué No. 23
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