According to Communiqué No. 311 issued by the Turkish Revenue Administration, there are updated guidelines on the annual tax declaration requirements for employees in 2024 in Turkey.
Salary Income Taxation and Declaration from Single or Multiple Employers
Taxation through withholding:
- For employees earning salary income from a single employer, an annual tax declaration is required if the total income exceeds the fourth income bracket of 3,000,000 TRY for 2024, as specified in Article 103.
- For those earning from multiple employers, an annual declaration is mandatory if the combined income, including from the main employer, surpasses 3,000,000 TRY.
- Employees with multiple employers whose income from secondary employers exceeds 230,000 TRY (second income bracket for 2024) must also file an annual declaration.
Employees with multiple employers can choose which income source to designate as primary. Only salary income is evaluated for declaration requirements, and other income sources are excluded from this calculation.
Deduction Eligibility for Annual Declarations
When submitting an annual tax declaration, employees may deduct expenses related to education, health, and donations from their declared income. Taxes withheld at source can be credited against the calculated income tax. Additionally, salary income not subject to withholding must be declared in line with Article 95 of the same Law.
Rules for Employees with Multiple Employers in the Private Sector
- Multiple Employer Classification: An employee is considered to have multiple employers if:
- They receive additional salary income from another employer or public entity within the year.
- They change employers during the same calendar year.
- They earn income from partnerships or companies in which they become partners.
- Separate Taxation: Salary income from each employer is taxed individually, with no cumulative calculation. Upon changing employers, the new employer’s income starts from a zero base.
- Single Employer Considerations: Certain scenarios, such as company mergers, subcontractor changes under the Turkish Labor Law, or partner/shareholder changes, are treated as a single employer.
- Cumulative Tax Basis: When salaries are earned within the same calendar year, they will be taxed cumulatively.
- Employee Request for Cumulative Taxation: Employees changing employers may request cumulative taxation, applying income tax brackets based on cumulative earnings by informing their new employer. Taxes already withheld can be credited on the cumulative basis in the annual declaration.
Exemptions for Special Income Categories
Certain income categories are exempt from income tax. These include salaries of personnel working on ships or yachts in the Turkish International Ship Registry, and salaries for R&D, design, and support roles, which are tax-exempt under relevant laws. Income tax deductions are not applied to these exempt salaries, meaning they are not part of the annual declaration requirements.
For employees in Free Zones, income tax withheld on salaries for R&D, design, and support personnel is returned to the employer. This exemption extends to other laws that provide income tax exemptions.
Income Tax Rates for 2024 (Salary Income Only)
- 15% for income up to 110,000 TRY
- 20% on the surplus over 110,000 TRY up to 230,000 TRY, with a base tax of 16,500 TRY
- 27% on the surplus over 230,000 TRY up to 870,000 TRY, with a base tax of 40,500 TRY
- 35% on the surplus over 870,000 TRY up to 3,000,000 TRY, with a base tax of 213,300 TRY
- 40% on the surplus over 3,000,000 TRY, with a base tax of 958,800 TRY
To access the Revenue Administration’s Communiqués No. 311 and No. 324 (in Turkish), please refer to the provided link. For any further inquiries, reach out to your customer representative.
