Tax Advantages of Establishing a Call Center in Turkey

Tax Advantages of Establishing a Call Center in Turkey

Tax Advantages of Establishing a Call Center in Turkey

Establishing a call center in Turkey offers significant tax advantages for businesses providing services to foreign clients. Specifically, when invoicing these services to clients abroad, businesses can benefit from an 80% income exemption. This advantageous tax benefit applies if the call center services are utilized exclusively by clients outside of Turkey.

Key Tax Benefits for Call Centers in Turkey

  1. Income Exemption: A substantial 80% income exemption is available when invoicing for services provided to foreign clients.

  2. Income Tax Deduction: According to Article 89, Paragraph 13 of the Turkish Income Tax Law No. 193, 50% of the income earned from specific services provided to foreign entities can be deducted from taxable income.

Conditions for Tax Benefits

To benefit from these tax advantages, certain conditions must be met:

  • Service Exclusivity: The call center services must be provided to and utilized exclusively by clients who are not residents of Turkey.

  • Invoicing Requirements: The invoice or similar document must be issued in the name of the foreign customer.

  • Service Type: The services must fall under specific categories, including call center and data storage services.

  • Client Location: The clients must be based outside of Turkey with their business, legal, and operational centers located abroad.

Eligible Services

The eligible services under this tax advantage include:

  • Call center services

  • Data storage services

  • Architecture, engineering, design, software, medical reporting, accounting, product testing, certification, data processing, data analysis, and other professional education services, as determined by the Ministry of Finance and relevant ministries.

Practical Application

For a call center operating in Turkey and serving clients in countries like the Netherlands, Belgium, and Germany, the following activities are typically covered:

  • Marketing and sales of products via phone by local personnel to foreign customers.

  • Conducting surveys and providing various customer services over the phone.

Example Scenario

A Turkish call center providing services to companies in Germany might perform tasks such as promoting and selling products, directing potential customers to the relevant companies, and conducting customer satisfaction surveys. Provided the service benefits exclusively the foreign clients and invoices are issued accordingly, the call center can deduct 80% of its income from these activities from its taxable income in Turkey.

Conclusion

Turkey offers attractive tax incentives for call centers that serve foreign clients. By fulfilling specific criteria, businesses can enjoy significant tax benefits, making Turkey an appealing location for establishing call center operations aimed at international markets.

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