Foreign Investor Guide
Reference: Presidency of the Republic of Turkey Investment office www.invest.gov.tr
INVESTMENT AREAS
FOREIGN INVESTMENT GUIDE
- BUILDING A BUSINESS
- WORK PERMIT
- RESIDENCE PERMIT
- REAL ESTATE AND CITIZENSHIP ACQUISITION
- COST OF DOING BUSINESS
- INVESTMENT AREAS
- TAX GUIDE
- LEGAL GUIDE
- INVESTMENT AREAS
There are three types of investment regions in Turkey:
- Technology Development Zones - Technoparks
Technology Development Zones (TGB) are areas designed to support R&D studies and attract investments in high technology. Currently there are 84 TDZs, 63 of which are active; The other 21 regions have been approved and the construction continues.
Advantages of TGBs
- Earnings from software development, R&D and design activities are exempt from income and corporate taxes until December 31, 2023.
- Sales of application software produced in TDZ are exempt from VAT until December 31, 2023. These include software used in system management, data management, business applications, different business sectors, internet, mobile phones and military command control systems.
- The wages of the R&D, design and support personnel working in the zone for these duties are exempt from all taxes until December 31, 2023. The number of support personnel within the scope of exemption cannot exceed 10% of the number of R&D personnel.
- The investment required for the production of the technological product obtained as a result of the R&D projects initiated and finalized in the region can be made within the region provided that the operating company approves it and the Ministry of Industry and Technology gives permission.
- Until December 31, 2023, 50% of the employer's share of the SSI premium will be covered by the state.
- The products to be imported within the scope of R&D, design and software development projects are exempt from customs duty and the documents to be issued are exempt from stamp tax.
- Organized Industrial Zones
Organized Industrial Zones (OIZ *) are designed to enable companies to operate using ready-made infrastructure and social facilities. The infrastructure provided in these regions includes roads, water, natural gas, electricity, communications, waste treatment and other services.
In 80 provinces, there are currently 331 OIZs, 234 of which are active; The construction of the remaining 97 OIZs is still continuing in various regions of Turkey.
Advantages of OIZs
In addition to the existing investment incentives in Turkey (general investment incentives, regional investment incentives, large-scale investment incentives, strategic investment incentives, employment incentives, R&D support, etc.), investors operating in OIZs also benefit from the following advantages:
- VAT exemption in land purchases.
- Property tax exemption for five years, effective from the completion of the facility construction.
- Low water, natural gas and communication costs.
- Tax exemption in division / merging of parcels.
- Local government tax exemption in facility construction and operation.
- Solid waste tax exemption if the OIZ does not benefit from municipal services.
- Free Zones
Free Zones are special areas located outside the scope of customs zones, although they are within the political borders of the country. These regions are designed to increase the number of export-oriented investments. Legal and administrative regulations applied in commercial, financial and economic areas in the customs areas are not implemented or partially implemented in free zones.
There are a total of 19 Free Zones in Turkey, close to the EU and Middle East markets, of which 18 are active and 1 is at the establishment stage. Free Zones are located at the points where access to international trade routes can be provided easily with ports in the Mediterranean, Aegean and Black Sea.
Advantages of Free Zones
- 100% exemption from customs duty and other taxes of the same kind.
- 100% exemption from corporate tax for manufacturing companies.
- 100% exemption from VAT and special consumption tax.
- 100% exemption from stamp tax applied to documents to be issued.
- 100% exemption from real estate tax.
- 100% income and corporate tax exemption for certain logistics services to be provided from Free Zones, provided that they are all abroad.
- 100% exemption from income tax on employee salary (for companies exporting at least 85% of the FOB value of products produced in free zones).
- Goods can be kept in free zones without any time limitation.
- Companies can freely transfer the profit obtained from free zones abroad or in Turkey without any restrictions.
- Exemption from title deed fees in property purchase and sale.
- VAT exemption in construction, project, settlement, permit and approval processes.
- Ready infrastructure, exempt from VAT and other taxes.
- Allowing second hand / used machinery to be brought in.