With the Presidential Decree No. 9286, Dividend Withholding Tax Rate Increased to 15%

Yayınlanma Tarihi: 27 Aralık 2024



With the Presidential Decree No. 9286, Dividend Withholding Tax Rate Increased to 15%

With the changes made with the Decree Annexed to the Presidential Decree No. 9286 published in the Official Gazette dated 22/12/2024 and numbered 32760;

·        Within the authority to determine the withholding rates, given in Article 94 of the Income Tax Law No. 193, the withholding rates to be applied to the dividends written in subparagraphs (1), (2) and (3) of the second paragraph of Article 75 of the said Law, distributed by the fully fledged taxpayer corporations to full fledged and limited taxpayer real persons, non-income and corporate taxpayers, those exempt from income tax and limited taxpayers who are exempt from income tax

·        Within the authority to determine the witholding rates, given in Article 15 of the Corporate Tax Law No. 5520, the withholding rates to be applied to the dividends distributed to tax-exempt corporations under subparagraphs (1), (2) and (3) of the second paragraph of Article 75 of the Income Tax Law,

·         Within the framework of the authority to determine the withholding rates in Article 30 of the Law No. 5520, the withholding rates to be applied to the dividends listed in subparagraphs (1), (2) and (3) of the second paragraph of Article 75 of the Income Tax Law, distributed by full-fledged taxpayer corporations to limited taxpayer corporations or limited taxpayers exempt from corporate tax, except for those who obtain dividends through a workplace or permanent representative in Turkey, and the withholding rates to be applied to the dividends of limited taxpayer corporations submitting annual or special declarations, Withholding tax rates to be applied on the amount transferred to the head office from the corporate income before deducting deductions and exemptions and after deducting the calculated corporate tax,

Are increased from 10% to 15%.

As it is known, dividends distributed by full-fledged taxpayer corporations to full-fledged taxpayer real persons, limited taxpayer real persons, limited taxpayer corporations, those which are not  subject to income or corporate tax and those exempt from income tax are subject to income/corporate tax withholding. With the regulation made by the Presidential Decree, the rate of withholding tax has been increased from 10% to 15%. As of the publication date of the Decree, dividends distributed will be subject to 15% withholding tax.

This Decree has entered into force as of December 22, 2024.

You can access the Decree from the link https://gib.gov.tr/node/179193.

The announcement of the Revenue Administration is as follows;

Regulation made with the Decree Annexed to the Presidential Decree No. 9286

With the regulation made by the Presidential Decree, the rate of withholding tax on dividend payments was increased from 10% to 15%.

Dividends distributed by full-fledged taxpayer corporations to full-fledged taxpayer real persons, limited taxpayer real persons, limited taxpayer corporations, non-income and corporate taxpayers and those exempt from income tax are subject to income/corporate tax withholding.

Half of the dividends received by real persons are exempt from income tax and if the remaining amount exceeds the second bracket of the income tax tariff for the relevant year (230.000 TL for 2024), it must be declared with the annual income tax declaration. All of the tax paid by withholding is deducted from the tax calculated in the declaration.

Withholding tax is the final tax for limited taxpayer real persons and corporations, non-income and corporate taxpayers and those exempt from income tax.

Dividends distributed as of the publication date of the Decree will be subject to 15% withholding tax.

https://www.gib.gov.tr/duyuru

Sincerely, for your information.