Deductions with respect to income to be declared by an annual tax declaration are specified in Income Tax Law and in other relevant laws. In order to make the following deductions from the income to be declared in income tax declaration while income tax base is being determined, there must be an income to be declared in an annual tax return and deductions to be made should satisfy the requirements specified in the relevant legislation.
The revenue that is declared at the annual tax return before the other deductions and the revenue loss of former years are deducted would be taken as the base revenue to calculate the amount that would be deducted.
Accordingly, following items may be subject to deduction:
Life/Individual Insurance Premiums
The 15% of life/individual insurance premiums paid, can be deducted for determining the tax base in the annual tax returns.
The premiums that should be taken into account for determining the tax base are as follows:
- 50% of life insurance payments of the taxpayers’, their spouses and children,
- 100% of death, accident, health, disability, maternity, child birth and education individual insurance
The total amount that would be deducted cannot exceed the 15% of total revenue and annual amount of minimum wage. (The gross annual minimum wage for 2019 is 30.700,80 TL).
After the date 01/01/2013 the premiums for the individual retirement insurance cannot be deducted.
Education and Health Care Expenses
The education and health care expenses done as stated below would be deducted from the annual revenue declared in tax return in condition not to exceed the 10% of total revenue:
- The education and health care expenses should be done in
- The expenses should be verified by the documents taken from the individual or legal personalities who are personal or corporate income
- The expenses should be regarding the taxpayers’ oneself or their spouse and children underage.
Donations and Aids
Limited Deductions
Personal income taxpayers, General and private budgeted public administrations, provincial administrations, municipalities, villages and non-profit associations and the foundations that are exempted from tax by the President of Republic, can deduct the donations and aids against receipt from their annual income in condition that it would not exceed the 5% of total income. (It would not exceed 10% of total income if donations are made to the stated organizations, associations and foundations in the development priority zone).
Non-limited Deductions
a)The donated schools, health institutions, the student dormitories and day care centers which have bed capacity not less than 100 (in development priority zones not less than 50), orphanages, rest houses, care and rehabilitation centers to the General and private budgeted public administrations, provincial administrations, municipalities, villages and all expenses for the construction of the place of worship constructed by the permission of authorized public administrative director, the institutions where the religious education is given under inspection of Directorate of Religious Affairs, youth centers and youth and scouting camps belong to the Youth and Sports Ministry or all donations and aids in kind or in cash made for the construction or for the maintenance of their activities of these establishments can be deducted.
b)The total cost of food, cleaning supplies, clothing and heating donated to the foundations and associations established as food banks for helping poor people in line with the procedures an principles determined by the Ministry of Finance can be
c)General and private budgeted public administrations, provincial administrations, municipalities, villages, non-profit associations, the foundations that are exempted from tax by the President of Republic, the expenses done by institutions which makes scientific research or the expenses for the studies that are supported by Ministry of Culture and Tourism and all donations and aids made for these purposes can be
ç) The total amount of the donations and aids in kind or in cash against receipt to the aid campaigns initiated the President of Republic.
d) The total amount of donations and aids in cash against receipt to the Turkish Association of Crescent and Turkish Green Crescent Society except their commercial enterprises can be deducted.
Sponsorship Expenses
According to The Income Tax Law Article (89/8) the sponsorship expenses done can be deducted from the income declared at annual tax return as follows:
- 100% of expenses for amateur sports,
- 50% of expenses for professional
Donations and aids which are completely deductible in accordance with other laws.
The total amount of the donations and aids in kind or in cash according to:
- The Improvement of Social Aid and Solidarity Law,
- Law on the Establishment of Turkish Scientific and Technical Research Institution,
- Law on Social Services and Child Protection Agency,
- Atatürk High Institution of Culture, Language and History Law,
- Turkish Armed Forces Foundation Law,
- National Afforestation and Erosion Control Mobilization Law,
- Primary Education Law
- Donations made to universities, high technology institutes and the foundations established by the President of Republic and aimed at maintaining and supporting the activities of state universities and at least three quarters of their
- The total amount of the donations and aids in kind and in cash and the sponsorship expenses to the administration established under the law No. 7174 on Cappadocia Area can be deducted.
Source: Revenue Administration – Guidebook on Rental Income for Non-Resident Taxpayers
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