On 3 February 2021, the Turkish Revenue Administration has published Presidential Decree No. 3490 in the Official Gazette introducing a restriction on the deduction of financial expenses. Restriction on the deduction of financial expenses rules was first introduced in 2012 in Article 41 of Income Tax Law and Article 11 of Corporate Income Tax.
Decree No. 3490 provides that, effective from 1 January 2021, the non-deductible financial costs and expenses are set at the rate of 10% for enterprises whose current liabilities exceed the equity. 10% of the total of expenses and cost elements made under the names of interest, commission, maturity difference, dividend, foreign exchange difference, and similar foreign resources used in the enterprise, excluding those added to the cost of the investment, excluding those added to the cost of the investment, excluding those added to the cost of the investment will not be accepted as an expense.
