Turkey Income Tax Calculator
How Turkish Income Tax Works
Turkish income tax (Gelir Vergisi) is a progressive tax administered by the Turkish Revenue Administration (GIB). The system uses five brackets with rates from 15% to 40%, with thresholds adjusted periodically to account for Turkey's high inflation environment. Tax residents are taxed on worldwide income, while non-residents pay tax only on Turkish-sourced income.
Employment income is subject to monthly withholding by employers, who apply the progressive brackets cumulatively throughout the year. According to the Turkish Ministry of Treasury and Finance, income tax is the second-largest revenue source after VAT, contributing approximately 25% of total tax collections. Turkey's tax-to-GDP ratio was approximately 24.6% in 2024, below the OECD average of 34%. Compare Turkey's rates with our Egypt Income Tax Calculator or Poland Income Tax Calculator.
Employees also pay social security contributions (SGK) of approximately 14% of gross salary (employee share), covering pension, health insurance, and unemployment. Employers contribute an additional 20.5%. A minimum living allowance (Asgari Gecim Indirimi) provides partial tax relief for lower-income workers based on family status.
How Turkish Income Tax Is Calculated
The GIB applies a standard progressive bracket formula:
Annual Tax = Sum of (Taxable income in each bracket x Rate for that bracket)
Worked example for an employee earning 500,000 TRY annually:
- First 110,000 TRY at 15% = 16,500 TRY
- Next 120,000 TRY (110,001-230,000) at 20% = 24,000 TRY
- Remaining 270,000 TRY (230,001-500,000) at 27% = 72,900 TRY
- Total tax: 113,400 TRY | Effective rate: 22.7%
- Monthly take-home (after tax only): approximately 32,217 TRY
Key Terms You Should Know
- Gelir Vergisi: Income tax in Turkish, the progressive tax on personal income with rates from 15% to 40%.
- GIB (Gelir Idaresi Baskanligi): The Turkish Revenue Administration, responsible for tax collection and enforcement.
- SGK (Sosyal Guvenlik Kurumu): Social Security Institution. Employee contributions are approximately 14% of gross salary covering pension, health, and unemployment insurance.
- Asgari Gecim Indirimi (AGI): Minimum living allowance, a tax credit that varies by marital status and number of children. Applied monthly to reduce the tax burden on lower-income workers.
- Beyanname: Annual tax return, required for taxpayers with multiple income sources, self-employment income, or rental income above the exemption threshold.
Turkish Tax Brackets for 2026
The following table shows Turkey's income tax brackets. Note that these thresholds are for employment income (gelir vergisi); separate, lower thresholds may apply for other income types. Brackets are frequently adjusted due to high inflation, as reported by GIB.
| Annual Income (TRY) | Rate | Tax on Bracket | Cumulative Tax |
|---|---|---|---|
| Up to 110,000 | 15% | 16,500 | 16,500 |
| 110,001 - 230,000 | 20% | 24,000 | 40,500 |
| 230,001 - 580,000 | 27% | 94,500 | 135,000 |
| 580,001 - 3,000,000 | 35% | 847,000 | 982,000 |
| Above 3,000,000 | 40% | Varies | Varies |
Practical Examples
Example 1: Minimum wage worker earning approximately 204,000 TRY/year (17,000 TRY/month). Tax: 110,000 at 15% + 94,000 at 20% = 35,300 TRY. With AGI credit reducing effective tax, actual PAYE is lower. Effective rate: approximately 15-17%. SGK contributions reduce take-home further.
Example 2: Mid-level professional earning 600,000 TRY/year (50,000 TRY/month). Tax: 16,500 + 24,000 + 94,500 + 7,000 (first 20,000 at 35%) = 142,000 TRY. Effective rate: 23.7%. Monthly take-home after tax and SGK: approximately 31,833 TRY. Use our Salary Calculator for details.
Example 3: Executive earning 4,000,000 TRY/year. Reaches the top 40% bracket. Total tax: 982,000 + (1,000,000 x 40%) = 1,382,000 TRY. Effective rate: 34.6%. Monthly take-home after tax (before SGK): approximately 218,167 TRY.
Tips to Optimize Your Turkish Tax Bill
- Contribute to private pension (BES): Contributions to the individual pension system (Bireysel Emeklilik Sistemi) qualify for a state contribution of 25% up to the annual minimum wage. This effectively provides a 25% return on investment before any market gains.
- Claim the minimum living allowance: Ensure your employer correctly applies your AGI based on marital status and dependents. A married worker with 2 children receives a significantly larger credit than a single worker.
- Deduct education and health insurance: Private health insurance premiums and certain education expenses are partially deductible from taxable income, though limits apply.
- Use the rental income exemption: Residential rental income up to a specified threshold (adjusted annually) is completely exempt from tax. Keep this in mind when calculating total rental returns.
- Time asset sales carefully: Capital gains on real estate held less than 5 years are taxed at progressive rates. Holding property for 5+ years results in a full capital gains tax exemption on the sale.
2026 Context and Recent Changes
Turkey has experienced significant inflation in recent years, with annual consumer price inflation averaging above 50% in 2023-2024, according to TUIK (Turkish Statistical Institute). This has prompted frequent adjustments to tax brackets and minimum wage levels. The minimum wage was raised substantially in 2025 to help workers cope with rising costs. Despite bracket adjustments, many middle-income workers have seen real bracket creep as salary increases lag inflation. Turkey's economy is the 17th largest in the world by GDP, and the government continues to balance revenue needs with economic growth.
Frequently Asked Questions
What are the Turkish income tax brackets for 2026?
Turkey has five progressive brackets: 15% on income up to 110,000 TRY, 20% on 110,001-230,000 TRY, 27% on 230,001-580,000 TRY, 35% on 580,001-3,000,000 TRY, and 40% on income above 3,000,000 TRY. These thresholds are for employment income and are updated periodically to account for inflation. For an employee earning 500,000 TRY, the effective tax rate is approximately 22.7%. Separate, lower thresholds may apply for self-employment and other income types.
What is the minimum living allowance (AGI) in Turkey?
The Asgari Gecim Indirimi (AGI) is a tax credit that reduces the income tax burden for employed workers. The base AGI is calculated as 50% of the minimum wage's annual tax burden for a single worker. Married workers receive additional amounts: 10% for a non-working spouse, plus 7.5% for each of the first two children and 5% for subsequent children. The AGI is applied monthly as a direct credit against tax withheld, and it is most impactful for lower-income workers where it can reduce the effective tax rate by several percentage points.
Do I need to file a tax return in Turkey?
Salaried employees with a single employer generally do not need to file, as tax is settled through monthly PAYE withholding. Annual filing is required if you earn income from multiple employers where combined income exceeds the second bracket threshold, rental income above the annual exemption, capital gains from securities, self-employment or freelance income, or income from abroad. Returns are due by March 31 following the tax year, with payment in two installments (March and July). Filing can be done online through the GIB e-filing portal.
How is rental income taxed in Turkey?
Residential rental income has an annual exemption (adjusted for inflation each year, approximately 33,000 TRY for 2026). Income above the exemption is added to other income and taxed at progressive rates. Landlords can choose between a flat 15% expense deduction on gross rental income or deducting actual documented expenses (maintenance, depreciation, insurance, mortgage interest). Commercial rental income does not benefit from the exemption but is subject to 20% withholding tax at source. Non-residents earning Turkish rental income must file an annual return.
What social security (SGK) contributions do Turkish employees pay?
Turkish employees contribute approximately 14% of gross salary to SGK: 9% for pension (long-term insurance), 5% for general health insurance. Employers contribute an additional 20.5% (11% pension, 7.5% health, 2% short-term insurance). There is also an unemployment insurance contribution of 1% from the employee and 2% from the employer. SGK contributions are subject to minimum and maximum salary floors and ceilings. Total employee deductions (income tax + SGK + unemployment) typically consume 30-40% of gross salary for mid-income workers.
How does Turkey tax non-residents and expats?
Non-residents are taxed only on Turkish-sourced income at the same progressive rates as residents. Tax residency is established by having a legal domicile in Turkey or spending more than 6 consecutive months in the country during a calendar year (temporary absences do not interrupt the count). Turkey has double taxation agreements with over 85 countries, including the US, UK, Germany, and most EU nations. Expats who become Turkish tax residents are taxed on worldwide income. Foreign nationals working in Turkey under an employment contract are subject to SGK contributions and income tax withholding just like Turkish citizens.