Turkey’s Revenue Administration has published Draft General Communiqué No. 25 amending Corporate Income Tax Communiqué No. 1, setting out detailed implementation rules on the domestic minimum corporate income tax, revised exemption conditions for investment funds and partnerships, and the reintroduced fourth provisional tax period.
Turkey’s Revenue Administration published Draft General Communiqué No. 25 amending General Communiqué No. 1 on Corporate Income Tax on 8 April 2026, which sets out implementation details under Law No. 7524 and Law No. 7566 covering the domestic minimum corporate income tax, corporate exemptions and procedural changes.
The draft introduces revised conditions for investment funds and partnerships benefiting from corporate income tax exemptions on real estate income, requiring the distribution of at least 50% of such income as dividends. The distributable profit is calculated after deducting direct real estate-related costs and expenses, as well as mandatory legal reserves. Capital increases from profits will not be recognised as dividend distributions for exemption purposes.
The rules also specify that the 50% distribution requirement does not apply where real estate activities or total activities result in a loss. Where real estate activities are profitable but overall profit is reduced due to losses from other activities, the requirement applies to the remaining total profit. Shared expenses must be allocated between activities on a proportional basis, while depreciation of shared assets must be apportioned according to usage.
In addition, the communiqué clarifies the treatment of profits and losses under exemption regimes. For activity-based exemptions, profits and losses across projects within the same category must be netted, with only the net result qualifying for exemption. For transaction-based exemptions, each transaction is assessed separately, with losses not offsetting exempt gains.
On the domestic minimum corporate income tax, the draft sets out calculation rules confirming that corporate tax cannot fall below a minimum threshold determined before certain deductions and exemptions. It also limits deductible investment contributions to those recorded in incentive certificates before 2 August 2024, excluding subsequent increases. Taxpayers may apply either a priority or proportional allocation method, and unused amounts may be carried forward.
The draft further reintroduces the fourth provisional tax period under Law No. 7566, establishing reporting and payment obligations for the final three months of the fiscal year, alongside provisions on free zone taxation and reduced corporate tax rates on export income.
