On 10 January 2023, Turkey issued Presidential Decision No. 6652 in the Official Gazette on additional research and development (R&D) and design deduction. According, Turkey extends the application of additional deduction for R&D and design from 31 December 2023 to 31 December 2028.

The Presidential Decision allows for a deduction of 50% on the increased expenses related to R&D and innovation, or innovation activities carried out in the R&D or design centers established under Law No. 5746 if there is at least a 20% increase in specific indicators from the previous year. This deduction will be applicable in calculating corporate income tax according to Article 10 of Corporate Tax Law No. 5520 until 31 December 2028. The increased design expenses compared to the previous year are also subject to the same 50% deduction.

The following indicators applied until 31 December 2028:

  • The share of R&D or design expenditure in total turnover;
  • Number of registered national or international patents;
  • Number of internationally supported projects;
  • The ratio of the number of postgraduate researchers to the total number of R&D personnel in R&D centers;
  • The ratio of the number of designers with graduate degrees to the total number of design personnel in design centers;
  • The ratio of the total number of researchers in R&D centers to the total number of R&D personnel;
  • The ratio of the total number of designers to the total number of design personnel in design centers; and
  • The ratio of turnover obtained from new products from R&D and design activities to total turnover.