Transfer Pricing
"What are Turkey's transfer pricing rules for related party transactions?"
Quick Answer
Turkish transfer pricing rules are primarily based on the Corporate Tax Law and its Communiqués, following OECD guidelines. Documentation and reporting obligations apply depending on the taxpayer profile and transaction volume.
Turkish Tax Framework
Transfer pricing in Turkey is primarily regulated under the Corporate Tax Law and secondary legislation (Communiqués) issued by the tax authorities, and is applied through the arm’s length principle in related party dealings. Documentation and reporting obligations are shaped by the relevant provisions of tax procedural rules and transfer pricing communiqués.
Key Points to Remember
- Corporate tax rates may change over time and can differ for certain sectors or periods. Check the current statutory rate and applicable rules for your specific structure
- VAT rates and exemptions depend on the specific goods or services and may change over time. Certain categories may benefit from reduced rates or exemptions under Turkish VAT rules
- Double tax treaties may reduce withholding tax rates
- Tax incentives are available for qualifying investments
Tax Planning Considerations
Documentation and reporting obligations apply depending on the taxpayer profile and transaction scope, and should be assessed under the applicable transfer pricing documentation framework (e.g., local file, master file, and other reporting requirements where relevant).
Businesses should work with qualified tax advisors to optimize their tax position while ensuring full compliance with Turkish tax authorities' requirements.
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