Turkey's Service Export Earnings Deduction (GVK 89/13, KVK 10/1-ğ): The 2026 Conditions for 100%

In 2026 everyone selling services abroad from Turkey is talking about the same number: 100%.

The number is right. But the deduction turns on its conditions, not its rate. When one condition is missing, 100% does not shrink a little — more often it drops straight to zero.

Known as Article 89/13 on the income tax side and Article 10/1-ğ on the corporate tax side, the deduction works the same way for self-employed professionals and for companies. This piece goes through the conditions one by one, using the situations I come across most often. It also covers two newer points: the certification requirement that applies from 2025, and the effect of the minimum corporate tax on companies.

How the rate reached 100%

Period	Rate
2012-2022	50%
2023-2025	80%
2026 onwards	100% (current)

The latest increase came not through legislation but through a Presidential Decision published on 30 April 2026, applying to periods beginning on or after 1 January 2026. Because it is a rate set under authority granted by law, it is a number worth checking each year before planning starts.

To see what the rate means on your own numbers, the service export deduction calculator runs the figure. The conditions below decide whether that figure holds.

Condition 1: The service must be on the list

The deduction is not open to every service. The list is closed: architecture, engineering, design, software, medical reporting, bookkeeping, call centre services, product testing, certification, data storage, data processing and data analysis, designated vocational training fields, and education and health services under the relevant ministry’s permission and supervision.

Consulting, assistance and brokerage services are excluded. Translation, content production and digital marketing are not on the list either.

The mistake I see most often here is in the wording. Even if the work you do is design, an invoice that says “design consultancy” can be read by the tax authority as consulting. The service description on the document has to reflect the listed activity. The contract, the invoice and the delivered work need to speak the same language.

Condition 2: The client must not be established in Turkey

The service must be provided to a company whose legal seat and place of management are outside Turkey, or to a person who is not resident in Turkey.

Two situations are often confused:

A client in a free zone does not count as abroad. A free zone may be a separate area for customs purposes, but a company operating there is established in Turkey. A service provided to it does not qualify. I covered the free zone regime itself in a separate article.

A service provided to a related foreign company is not excluded, but the price is tested separately against what would be charged to an unrelated client. For intra-group services, how the price was set needs documenting from the start.

Condition 3: The service must be used exclusively abroad

A client abroad is not enough. The service has to relate to the client’s activity abroad.

An example: you develop software for a German company. If the software is used in the company’s operations in Germany, the condition is met. If it is developed for the same company’s branch in Turkey, or for its activity aimed at the Turkish market, it is not — even though the invoice went to Germany.

The same logic extends to sources of revenue. Where a product is sold through a foreign platform, revenue from users in Turkey is not treated as payment for a service used abroad.

Condition 4: The service must be provided from Turkey

The deduction is for services produced in Turkey and delivered abroad. The work has to be done with a team and infrastructure in Turkey. Where a significant part of the team works abroad, being able to show which part was produced in Turkey becomes part of the file.

Condition 5: The document must be issued to the client abroad

For a company it is an invoice, for a self-employed professional a self-employment receipt — either way it is issued in the name of the client abroad that receives the service. A platform or intermediary in between is not the addressee unless it is the party to the contract.

How this condition is met when working through platforms is covered in detail in the piece for Upwork and Fiverr earners.

Condition 6: All of the earnings must reach Turkey in time

This is the least discussed and most costly condition.

All of the earnings must be transferred to Turkey by the date the relevant year’s return is due. For an income taxpayer that date is the end of March of the following year; for a company using the calendar year as its accounting period, the end of April. The dates are on the tax calendar.

The decisive word is “all.” If only part of the earnings is brought in, the deduction does not shrink proportionately — it is lost entirely, including for the part that was brought in. A transfer made after the deadline does not restore it.

In practice it gets stuck in the same places:

• A balance left with a company or payment account abroad does not count as brought into Turkey.
• Settling a receivable from a foreign client by offsetting mutual debts and credits may not be accepted as a transfer.
• If a December invoice is not collected before the end of March or April, that year’s deduction is at risk.

The deduction can also be applied in advance tax periods, on the same condition: that period’s earnings must reach Turkey by the filing deadline for that period’s advance tax return.

Where transfers get stuck on their way into a Turkish bank is covered in the piece on why banks treat incoming transfers as loans.

Condition 7: Deductions above the threshold are certified

A new condition applies from 2025 onwards, and very few people are aware of it.

Exemptions and deductions shown on a separate line of the return that exceed TRY 500,000 individually, or TRY 1,000,000 in total across several, now require certification by a sworn financial advisor (YMM). The amounts are updated each year. For 2026 the thresholds are TRY 560,000 and TRY 1,120,000.

The report is submitted to the tax office with the return or within two months after the filing deadline. If it is not submitted in that window, the deduction cannot be used, and a penalty applies on top.

At a 100% rate this threshold means something new. Because the deduction now equals the whole of the earnings, a self-employed professional whose annual earnings exceed TRY 560,000 is subject to certification as well. The threshold catches individuals as much as companies.

The SMMM sets up and maintains the records; the YMM certifies. When the file is kept ready for certification from the start, the report becomes a formality. In a file assembled afterwards, the report becomes the document that exposes the gaps. I explained why the certification report works as a defence tool on the technopark side.

The deduction applies to earnings, not turnover

100% is not 100% of revenue. It is 100% of earnings.

Earnings are revenue from these services minus the expenses related to that revenue. Direct costs are assigned directly; shared costs are allocated to the activity using a reasonable allocation key. Ancillary income that does not arise from the activity itself, such as interest, is not covered by the deduction.

Where a company has clients both in Turkey and abroad, this split sits at the centre of the file.

The limits of the deduction

It cannot be used in a loss year, and it does not carry forward. The deduction is limited to that year’s earnings. An amount unused because earnings were insufficient cannot be moved to later years.

It is not combined with the technopark exemption for the same earnings. Earnings covered by the exemption already leave the tax base and cannot also be subject to this deduction. The decision is a matter of “which one” — see the technopark earnings exemption scope for where that line falls.

It does not remove withholding on dividends. The deduction lowers the company’s corporate tax base. The withholding applied when profit is distributed to shareholders is a separate stage and is unaffected.

VAT is a separate regime. The VAT exemption on service exports is not limited to this list and works under its own conditions. It can apply even where the conditions of the earnings deduction are not met.

For a company, 100% does not mean zero tax

For companies this may be the most important part of the piece.

In the domestic minimum corporate tax calculation, this deduction is not among the items that can be deducted. Corporate tax payable cannot fall below 10% of corporate earnings before the deduction.

The list is not fixed: a communiqué published in July 2026 added the deductions for foreign brokerage earnings, qualified service centres and financial service exports in the Istanbul Finance Centre. The service export earnings deduction was not included in that expansion. The tax authority’s guide on the subject is dated April 2026, before the addition, so anyone checking the list there sees the earlier version.

An example: a company has TRY 5,000,000 of earnings, all from service exports. In the ordinary calculation, the 100% deduction brings the base to zero and the tax to zero. In the minimum tax calculation, assuming no other deductible items, TRY 500,000 — 10% of the earnings — is payable.

Two exceptions change the picture:

Companies starting business for the first time are outside the minimum tax for three accounting periods, including the period in which they start. During that time the 100% deduction works in full.

Income taxpayers have no minimum tax. For a self-employed professional or sole proprietor, the 100% deduction genuinely means zero income tax once the conditions are met.

This is why, in 2026, the question of sole proprietor versus company needs recalculating for anyone exporting services. A decision taken without weighing the minimum tax and the withholding on distributions together is incomplete.

The file that defends the deduction

In an inspection, what keeps the deduction standing is not the line on the return but the file behind it. The file should contain:

• Documents and the contract showing the client is established abroad
• Invoices or receipts describing the service in terms of the listed activity
• Delivery records and correspondence showing the service is used in the client’s activity abroad
• Bank records showing all of the earnings reached Turkey in time
• A revenue and expense breakdown showing how the earnings were calculated, with the allocation key for shared costs
• Where the threshold is exceeded, a certification report submitted on time

In short

The 100% rate in 2026 is the strongest tax advantage Turkey has ever offered service exports. But each of the seven conditions is tested separately, and one missing condition can take the entire deduction with it.

For companies, once the first three periods have passed, roughly 10% of earnings is still taxed through the minimum corporate tax. Where the deduction exceeds the threshold, the certification report is no longer optional — it is a condition of the deduction itself.

I have been at this table since 2003, and what I see in service export files does not change: what loses the deduction is usually not the legislation itself, but conditions remembered only at year end. When the conditions are in place from the first invoice, 100% really is 100%.