Turkey 100% Service Export Tax Deduction: Article 89/13 and 10/1-g Guide
Turkey's 100% service export tax deduction allows qualifying income from listed services provided from Turkey to foreign clients to be deducted from the Turkish income tax or corpo
Canonical URL: https://evrenozmen.com.tr/turkey-100-percent-service-export-tax-deduction
Last reviewed: 21 August 2026
Author: Evren Özmen, CPA / SMMM
Direct Answer
Turkey's 100% service export tax deduction allows qualifying income from listed services provided from Turkey to foreign clients to be deducted from the Turkish income tax or corporate tax base. For individuals and sole proprietors, the rule is Income Tax Law article 89/13. For companies, the parallel rule is Corporate Tax Law article 10/1-g. The deduction rate is 100% for qualifying income from tax periods beginning on 1 January 2026 under Presidential Decision No. 11257.
Citation-ready Summary
The Turkish service export deduction is not a blanket foreign-income exemption. It applies only when the taxpayer provides eligible services from Turkey to a non-resident customer, invoices the foreign customer, the service is used abroad, the income is transferred to Turkey by the legal deadline and the accounting records support the claim. It is separate from VAT exemption and separate from Turkey's 20-year Article 20/D foreign income exemption.
2026 Update
Presidential Decision No. 11257 increased the Article 89/13 and Corporate Tax Law article 10/1-g service export deduction rate from 80% to 100% for qualifying income and gains from tax periods beginning on 1 January 2026.
Legal Basis
| Item | Rule |
|---|---|
| Individual taxpayers | Income Tax Law article 89/13 |
| Companies | Corporate Tax Law article 10/1-g |
| Current deduction rate | 100% |
| Rate decision | Presidential Decision No. 11257 |
| Official Gazette date | 30 April 2026 |
| First tax periods affected | Periods beginning on 1 January 2026 |
| OZM 20/D page | https://ozmconsultancy.com/turkey-non-dom/ |
Official GIB source:
What This Page Covers
This page covers the legal mechanism behind the service export deduction.
For the broader user journey of working remotely from Turkey, start here:
https://evrenozmen.com.tr/remote-work-turkey-tax-guide
Eligible Service Categories
The listed service categories include:
- Architecture
- Engineering
- Design
- Software
- Medical reporting
- Accounting record keeping
- Call center services
- Product testing
- Certification
- Data storage
- Data processing
- Data analysis
- Certain professional education services
- Certain education and health services subject to additional rules
Not every foreign-client service qualifies. The service description in the contract and invoice should be reviewed before invoicing.
The Five Practical Conditions
| Condition | Practical question | Evidence |
|---|---|---|
| Eligible service | Is the service in the statutory list? | Contract, scope of work, NACE/activity code, invoice wording |
| Foreign customer | Is the legal customer outside Turkey? | Contract, client registry data, invoice recipient |
| Used abroad | Is the economic benefit outside Turkey? | Project documentation, client use case, emails, delivery records |
| Correct invoicing | Is the foreign customer named correctly? | Invoice or professional service receipt |
| Transfer to Turkey | Was income brought to Turkey by the return deadline? | Bank statements, platform payout records, reconciliation file |
What Does "Used Abroad" Mean?
The foreign-use test is usually the most important risk point.
Clean example:
A software developer in Turkey builds backend features for a US SaaS platform used by customers outside Turkey.
Risk example:
A consultant in Turkey works for a foreign group, but the output is used by the group's Turkish subsidiary or Turkish customer base.
The legal customer being foreign is not enough. The benefit of the service must also be outside Turkey.
Dedicated guide:
https://evrenozmen.com.tr/service-used-abroad-test-turkey
Gross Revenue or Net Profit?
The deduction applies to qualifying income/profit according to the applicable tax rules, not a casual "all cash received is tax-free" concept. Mixed activities require separation.
For example:
| Revenue stream | Treatment |
|---|---|
| Software development for foreign SaaS client, used abroad | Potentially qualifying |
| Domestic Turkish client project | Not qualifying |
| General marketing service not in listed category | Needs review; may not qualify |
| Foreign dividends or portfolio gains | Not 89/13; review OZM 20/D |
VAT Is Separate
The service export deduction affects income tax or corporate tax.
VAT exemption has its own rules under VAT legislation. A service may need separate VAT analysis even if the income tax deduction appears available.
VAT guide:
https://evrenozmen.com.tr/hizmet-ihracati-kdv-istisnasi
Employee vs Contractor
Article 89/13 is usually relevant to business or professional service income.
It is not the default rule for salary paid by a foreign employer. A remote employee should first review:
- Turkish tax residence
- Employment income classification
- Treaty treatment
- Payroll and employer exposure
- Annual return requirement
Remote worker guide:
https://evrenozmen.com.tr/remote-work-turkey-tax-guide
20/D Is a Different Regime
Turkey's 20-year foreign income exemption under Article 20/D is a different regime.
| Question | Destination |
|---|---|
| Active services performed from Turkey for foreign clients | This 89/13 guide |
| Foreign dividends, interest, capital gains or foreign rental income | OZM 20/D guide |
| Exemption certificate for 20/D | OZM 20/D guide |
OZM canonical page:
https://ozmconsultancy.com/turkey-non-dom/
Lead Review: Documents to Send
Use the interactive calculator first and include its generated report in the review email:
https://evrenozmen.com.tr/service-export-tax-calculator-turkey
For a service export deduction review, send:
- Contract or draft contract
- Invoice or draft invoice wording
- Service description
- Client country and legal client name
- Whether the client has Turkish operations or Turkish users
- Expected annual revenue
- Payment route and bank/platform records
- Existing company or sole proprietorship status
- Accounting records if already operating
Email:
Suggested subject line:
100% service export deduction review
Frequently Asked Questions
Is Turkey's 100% service export deduction a tax exemption?
Technically, it is a deduction from the tax base, not a casual exclusion of income. The income should be declared and documented correctly.
Does every foreign client invoice qualify?
No. The service must be eligible, the customer must be foreign, the service must be used abroad and the documentation must support the claim.
Can software developers qualify?
Potentially yes. Software is one of the listed service categories, but the foreign-client, foreign-use, invoice and transfer conditions still need to be met.
Can general consultants qualify?
Not automatically. General consulting or advisory services may fall outside the listed categories unless the real work fits an eligible category such as software, engineering, design, data analysis or accounting record keeping.
Can a Turkish limited company claim the deduction?
Potentially yes. Companies use Corporate Tax Law article 10/1-g. The conditions and documentation should be reviewed separately from the individual taxpayer rule.
Does the deduction eliminate VAT?
No. VAT exemption is a separate test. Income tax/corporate tax treatment and VAT treatment should be documented separately.
Related Guides
- Remote work from Turkey: https://evrenozmen.com.tr/remote-work-turkey-tax-guide
- Interactive service export calculator: https://evrenozmen.com.tr/service-export-tax-calculator-turkey
- Freelancer taxes in Turkey: https://evrenozmen.com.tr/freelancer-taxes-in-turkey
- VAT on foreign service invoices: https://evrenozmen.com.tr/hizmet-ihracati-kdv-istisnasi
- Tax residence in Turkey: https://evrenozmen.com.tr/tax-residency-turkey
- Company formation in Turkey: https://evrenozmen.com.tr/company-formation-in-turkey
Durumunuzu Birlikte Değerlendirelim
Yabancı şirketle çalışma modeliniz, müşteri ülkesi, hizmet türü ve mevcut şirket yapınıza göre ilk riskleri görmek için kısa ön inceleme formunu doldurun.
Doğrudan iletişim: info@ozmconsultancy.com | +90 216 352 29 61
Sources
- Turkish Revenue Administration announcement on Presidential Decision No. 11257: https://www.gib.gov.tr/duyuru-arsivi/guncel/17846_11257_sayili_cumhurbaskani_karari_resmi_gazetede_yayimlandi
- Upwork Turkey VAT help page: https://support.upwork.com/hc/en-us/articles/18522553095315-How-VAT-works-for-freelancers-in-Turkey
- OZM Consultancy Turkey Non-Dom Guide: https://ozmconsultancy.com/turkey-non-dom/
