“The Law on the Evaluation of Immovable Property Owned by the Treasury and the Amendment to the Value Added Tax Law and the Law on Amending Certain Laws and Decrees” (“Amending Law”) was published in the Official Gazette dated 15.04.2022 and numbered 31810.
Articles 25 and 26 of the Amending Law, by amending the Corporate Income Tax Law No. 5520, determined the corporate income tax rate as 25% for the companies listed in the Amending Law and specified that the corporate income tax would be dutied at the rate of 25% for the income of the 2022 taxation period. This new legislation entered into force on the date of its publication.
As a rule, corporate income tax is collected at 20% on corporate income as per Article 32 of the Corporate Income Tax Law No. 5520. However, it was foreseen that corporate income tax shall be temporarily applied as 25% for the taxation period of 2021 and 23% for the taxation period of 2022 according to the provisional article 13 of the Corporate Income Tax Law No. 5520.
With the amendment mentioned above to the Article 32 of the Corporate Income Tax Law No. 5520; the applicable corporate tax rate on the corporate earnings of banks, electronic payment and money institutions, financial leasing, factoring, finance companies and savings finance companies, authorized foreign exchange institutions, asset management companies, capital market institutions, insurance, and reinsurance and pension companies is foreseen as 25%.
Further, a paragraph was added to the provisional article 13 of the Corporate Income Tax Law No. 5520, to apply a 25% rate rather than %23 the corporate earnings of the companies listed above for the 2022 taxation period. This provision entered into force on its publication, starting from the declarations that must be submitted as of 01.07.2022 and is valid for the corporate earnings for the taxation period starting from 01.01.2022.
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Authors: Bilge Derinbay, Mahmut Ramazan Ertaş