A Brief Guide to Turkey’s New 1% Withholding Tax in E-Commerce
A Brief Guide to Turkey’s New 1% Withholding (Stopaj) in E-Commerce
A Brief Guide to Turkey’s New 1% Withholding (Stopaj) in E-Commerce
(Effective as of January 1, 2025)
Table of Contents
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Introduction
On January 1, 2025, a new 1% withholding tax (stopaj) in the e-commerce sector will take effect in Turkey. This measure aims to enhance tax compliance and reduce unregistered transactions. Although the law mentions higher rates (such as 25% for income tax and 15% for corporate tax), the Presidential Decree No. 9284, dated December 21, 2024, has set the withholding rate at 1%.
For e-commerce sellers and service providers—as well as international stakeholders keeping track of Turkish regulations—this guide offers an easy-to-follow overview, with short explanations, bold highlights, and practical examples.
Legal Background
Law No. 7524 (Torba Kanun, published on August 2, 2024): Introduced new withholding rules under Law No. 6563 on the Regulation of Electronic Commerce.
Key Definitions:
Intermediary Service Provider (Aracı Hizmet Sağlayıcı): Any real or legal person that provides an electronic environment allowing third parties to conduct economic or commercial activities.
Electronic Commerce Intermediary Service Provider: Specifically refers to those operating an e-commerce platform (also called a pazar yeri or marketplace) where sellers list products/services.
The Withholding Mechanism: These intermediaries must withhold tax on payments made to service providers and e-commerce service providers for the sale of goods or services in online marketplaces.
9 Questions About the New 1% Withholding
1) Who Is Obliged to Withhold?
Intermediary service providers and electronic commerce intermediary service providers must withhold tax on payments they make to sellers (referred to as “service providers” or “e-commerce service providers”) within the scope of Law No. 6563.
Key Point: If the final payment goes directly from the customer to the seller (i.e., no intermediary is involved in the actual transfer of funds), then no withholding applies.
2) What Is the Withholding Base?
The withholding base is generally the gross payment (excluding VAT) made to the seller. Specifically:
Price of Goods or Services (excluding VAT and any accommodation tax)
Any bonuses, awards, or incentives paid by the intermediary to the service provider
Even if a commission, shipping fee, or bank fee is deducted before transferring the balance to the seller, the tax base remains the full pre-deduction amount (again, minus VAT).
3) What Is the Withholding Rate?
Although law initially set the rate much higher (25% for individual taxpayers, 15% for corporations), the Presidential Decree lowered it to 1%. The President retains authority to reduce it to zero or increase it up to one fold.
4) When and How to Declare the Withholding?
Monthly Filing: The withholding tax must be reported via the Muhtasar ve Prim Hizmet Beyannamesi (Withholding and Premium Service Tax Return) by the 26th of the following month.
Payment Deadline: The withheld amount is also due by the same date (26th).
Data Reporting: Detailed information about each seller (e.g., name, tax ID, withheld amount) must be submitted electronically (via the BTRANS system) by the end of the filing month.
5) Which Payments Are Exempt?
Withholding does not apply if the recipient:
Has no tax liability in Turkey (e.g., not engaged in commerce or agriculture, or not a registered taxpayer)
Is a tax-exempt tradesperson
Operates under simple taxation (basit usul)
Benefits from the special income tax exemption (e.g., certain social content creators and mobile app developers under the relevant articles of the Income Tax Law)
Personal items sold online (like a second-hand coat or household items) are also exempt even if the seller is normally a taxpayer—provided the transaction is clearly unrelated to ongoing commercial activities.
6) How Do Refunds Work?
Before Filing: If the return or cancellation of the goods/services happens before the withholding is declared to the tax office, the intermediary can simply re-adjust its records and no withholding is declared.
After Filing: If the customer returns the product after the withholding tax has been declared and paid, the stopaj cannot be corrected in the monthly filing. The seller can reclaim the withheld amount through annual or provisional tax returns by offsetting it against other taxes due or requesting a refund from the tax office.
7) When Can the Withheld Amounts Be Credited?
All withheld taxes can be credited against:
Quarterly Provisional (Geçici) Tax
Annual Income Tax or Corporate Tax
Any excess remaining after the credit is refundable (either cash or offset against other tax debts).
8) Any Practical Examples?
Example A:
A household electronics retailer sells through an e-commerce platform. The total invoice (excluding VAT) is 1,000 TL. If the marketplace charges a 50 TL commission and then pays 950 TL to the retailer, the withholding base is still 1,000 TL. At 1%, the withheld tax is 10 TL.Example B:
A private individual sells a personal second-hand sofa via a marketplace. Since this sale is not part of an ongoing commercial activity, no withholding applies.
9) When Does the New Rule Come Into Effect?
The new withholding mechanism begins on January 1, 2025. Payments made to sellers on or after this date are subject to 1% stopaj, provided there is an intermediary collecting and transferring the funds.
Q&A Section
Q: Is the 1% withholding the final tax on my income?
A: No. It serves as a prepaid tax. It can be deducted against your final income or corporate tax. If your annual tax liability is zero, you may apply for a refund.
Q: What if I operate my own e-commerce website without an intermediary?
A: If your customer pays you directly (i.e., no intermediary transfers your revenue to you), you do not incur a withholding on these sales.
Q: Can the withholding rate change later?
A: Yes. The President has the power to reduce the rate to 0 or increase it up to double (e.g., 2%).
Q: Do I still file my own tax returns if I have withholding deductions?
A: Yes. You are still obliged to file annual or provisional tax returns and reflect these withholdings for final tax calculation.
Conclusion
Turkey’s new 1% e-commerce withholding tax is designed to capture previously unregistered activities and ensure faster tax collection. While it represents an added compliance step for businesses, it also streamlines tax collection and provides a credit/refund mechanism to avoid double taxation.
For foreign-based or internationally active stakeholders, staying informed about these regulations—and coordinating with your local tax advisors—is crucial to ensuring smooth operations in Turkey’s growing e-commerce market.
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