Turkey’s Ministry of Treasury and Finance has released an updated guide on the Simple Method of Taxation for business income, aimed at individuals engaged in business activities under Article 20/A of the Individual Income Tax Law (IITL).
This method allows eligible taxpayers to calculate business income by deducting expenses from gross revenue without maintaining detailed records, and it is exempt from individual income tax if criteria are met.
Eligibility requirements include active business participation, specific rental expense limits, turnover thresholds for goods and services traders, and restrictions on certain industries like finance and large-scale manufacturing. Businesses exceeding these limits must switch to real taxation starting January 2026, while those under real taxation can revert to the simple method if they meet the criteria for two consecutive years.
The guide also clarifies reporting obligations, including using the e-Ledger system for record-keeping, and exempts simplified taxpayers from VAT on sales.
