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Hiring in Turkey

Hiring employees compliantly in Turkey means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Turkey so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Turkey; or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Need assistance hiring in Turkey? Contact us about our International EOR Service

Labor Laws in Turkey

Employee Probation Period

  • The Turkish Labor Law gives an employer a maximum two-month probation period during which employment may be terminated without penalty.

Annual Leave in Turkey

  • Employees are entitled to paid annual leave, provided that they have worked for at least one year, including the probationary period. Paid time off is dependent on the number of years of service:
    • Years 1-5: 14 working days
    • More than 5 years but less than 15: 20 working days
    • 15 years or longer: 26 working days
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Holidays in Turkey

Here is the full list of public holidays in Turkey:

New Year’s Day 1st January
National Sovereignty and Children’s Day  23rd April
Labor Day and Solidarity Day 1st May
Commemoration of Ataturk, Youth and Sports Day 19th May
Ramadan Religious Holiday for 3.5 days
Victory Day 30th August
Sacrifice Feast  Religious Holiday for 4.5 days
Republic Day 29th October

 

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Maternity Leave Turkey

  • Mothers are entitled to 16 weeks of maternity leave
  • Pregnant women are eligible to receive 8 weeks of maternity leave preceding and following childbirth.
  • In addition, they are eligible for lump-sum pregnancy, childbirth, and nursing benefits..

Paternity Leave Turkey

  • Fathers are entitled to 5 days of paid leave
  • Fathers are entitled to 3 days of paid leave in case of adoption

Sick Leave in Turkey

  • In accordance with article 46 (c) of the Turkish labor law, all employees are entitled to maximum one week paid sick leave upon production of confirmative medical report. Sick leave might be extended. Extended sick leave is granted on unpaid basis.
  • Employers are not obligated to provide sick pay to employees, but employees are entitled to sick pay through government disability programs.
  • In practice, most employers continue to pay employees their full salary while they are sick and deduct the amount paid by the Social Security Institution from the employee’s salary.

Working Hours in Turkey

  • Work hours cannot exceed 45 per week and should be equally divided between the number of days worked.
  • There is no ‘standard’ work week in Turkey.

Overtime in Turkey

  • If working hours exceed 45 in a week, employees are entitled to overtime pay.
  • This includes increasing the employee’s regular hourly rate by 50%.
  • In lieu of payment, employees may be granted 1.5 hours of ‘free time’ for every overtime hour worked.
  • Overtime rates may be increased on the basis of a collective bargaining agreement or employment contract.
  • The total number of overtime hours may not exceed 270 hours per year.

Termination of Employment in Turkey

  • As per article 17 of Turkish Labor Law 4857, both employee and employer can terminate an open-ended employment contract, provided that required notice period is given to the other party.
  • In case fixed-term employment contract is concluded only for a defined period of time (with a specified end date) there will not be a notice of termination/notice pay obligation.
  • The minimum notice period depends on the length of service
  • Notice periods can be substituted by payment in lieu.
  • The employer may terminate the employment contract by paying in advance the wages corresponding to the term of notice.
  • Employee may pay the notice payment for terminating the contract (by resignation).
  • In the presence of just cause for termination parties don’t have to observe notice periods.
  • Employers have the right to make a severance payment in lieu of notice.
  • Severance payments are required for termination of an employment contract whether or not there is a just cause for termination
  • The employee must have been employed for more than one year in order to receive severance.

Notice Period in Turkey

  • In the event there is no cause justification, employers are obliged to comply with mandatory termination notice periods which vary depending on the length of the employment. The minimum legal periods are as follows:
  • Less than six months of employment: two weeks’ notice
  • Between six months and 18 months of employment: four weeks’ notice
  • Between 18 months and three years of employment: six weeks’ notice
  • More than three years of employment: eight weeks’ notice

Severance in Turkey

  • Severance payments are required for termination of an employment contract whether or not there is a cause justification.
  • The employee must have been employed for more than one year in order to receive severance.
  • The severance payment is calculated by multiplying the employee’s last 30 days’ gross wage by the number of years employed

Turkey Salary and Wages

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13 / 14th Month Salary in Turkey

  • No
  • There is no statutory requirement to pay the 13th or the 14th month salary.
  • Employees are entitled to 14 days of holiday pay which increases with length of service.
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Income Tax in Turkey

  • Individuals who are resident in Turkey (full liability taxpayers) are subject to tax on their worldwide income.
  • Nonresidents (limited liability taxpayers) are taxed only on earnings and revenues derived in Turkey.
  • Turkey has a unitary tax system under which income derived from different sources is aggregated and tax due is computed on the total aggregate income.
  • Under the unitary system, withholding taxes are considered advance payments of tax and are credited against the tax due in the annual return.
  • Income derived in Turkey by residents and nonresidents are allocated to the following categories:
    • Commercial income
    • Agricultural income
    • Employment income (remuneration)
    • Self-employment earnings
    • Revenues from immovable properties (including royalties)
    • Income from capital investments (dividends and interest)
    • Other earnings and gains (capital gains)
  • The following rates apply to employment income from 1 January 2023 (numbers in parentheses represent rates and brackets applicable to non-employment income)

Taxable income (TRY )

Tax on column 1 (TRY)

 

Tax on excess (%)

 

Up to 70,000 - 15%
70,000 to 150,000 10,500 20%
150,000 to (370,000) 550,000 26,500 27%
370,000 (500,000) to 1,900,000 (85,900) 134,500 35%
Over 1,900,000 (607,000) 621,400 40%
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Social Security in Turkey

  • Effective from 1 January 2023, the government of Turkey has increased the Social Security Minimum Wage Amount to 10,008.00 TRY Gross and 8,506.80 TRY Net.
  • The monthly SSI Ceiling Amount has increased to a gross amount of 75,060.00 TRY.
  • For Turkish nationals, the general rates are 20.5% (if certain conditions are satisfied, it is reduced by 5% to 15.5%) for the employer and 14% for the employee.
  • A foreign national who remains covered under the social security system of one’s home country is not required to pay Turkish social security premiums up to a maximum period of three months, provided proof of foreign coverage is filed with the local social security office.
  • If there is a social security treaty between the home country and Turkey, the exemption period may be longer, depending on the treaty.
  • If the employee is not subject to foreign social security, full contributions will generally be imposed in Turkey.
  • The employee's portion of the social security contributions is deductible in determining taxable income.
  • Unemployment insurance premiums are calculated over an upper earnings level of TRY 735.75 per day between 1 January 2020 and 31 December 2020.

Contribution

Group 1083

Social Security Contribution

Unemployment Insurance

Employee

Group 1083

14%

1%

Employer Group 1083 20.5% 2%

Note: - State makes 1% contribution to unemployment insurance.

Immigration Turkey

Need assistance hiring in Turkey? Contact us about our International EOR Service

Definite-term work permit.

  • A work permit for a maximum of one year shall be issued in the first application for the foreigner.
  • Such work permit does not exceed the term of the foreigner’s employment or service agreement to work at a specific workplace owned by a legal entity or a real person, or a public institution or establishment, or other workplaces owned by the same in the same business sector.
  • In the case of an extension request, the foreigner shall be granted a maximum of two years’ extension at the first extension application for the same employer, and for further applications, a maximum of three years’ extension shall be granted.

The Turquoise Card may be granted to foreigners who have the following characteristics:

  • Are evaluated to be highly qualified labor given their education, salary, professional knowledge and experience, contribution in science and technology, and similar qualifications
  • Are evaluated to be highly qualified investors given their investment or export level, size of the employment they will provide, contribution in scientific and technological development, and similar qualifications
  • Contribute in scientific and technological development or are scientists or researchers who conduct studies that are considered to be strategic on the international level in terms of the country’s interest in the fields of science, industry and technology
  • Are successful on the international level in cultural, artistic or sportive activities
  • Contribute in the international recognition or promotion of Turkey or the Turkish culture and carry out international activities in relation to national interests of Turkey
    • The Turquoise Card will be given for a transition period of three years.
    • The General Directorate assigns a specialist to monitor the activities and commitments of the Turquoise Card holder within the transition period in 12-month periods.
  • The transition period registration on the Turquoise Card that is not canceled within the transition period shall be removed if the request to remove the transition period registration is approved and the Turquoise Card becomes indefinite.

Indefinite-term work permit.

  • Foreigners with a long-term residence permit or a legal work permit with a minimum term of eight years may apply for an indefinite-term work permit.
  • However, fulfilling the application criteria does not automatically entitle the foreigner to be granted an indefinite work permit.

Independent work permit.

  • Under the Law, the following persons are required to obtain an independent work permit in order to work in Turkey:
    • Statutory managers of limited liability companies who are also shareholders of the relevant company
    • Board of directors’ members of joint stock companies who are also shareholders of the relevant company
    • Commandite shareholders of partnerships in commendam, the capital of which is divided into shares

Type of Visa/ Permit

Documentation

Validity

Eligibility

Definite-term work permit

  • Passport
  • Work visa application Form
  • Employment Contract or formal job offer

1 year (can be extended)

  • This is issued to foreigners applying for fixed term employment

The Turquoise Card

  • Application form
  • Copy of the passport or equivalent document of the foreigner
  • Certificate of conformity taken from related public organization or institution
  • Diploma,
  • labor contract
  • CV
  • appointment letter

3 years (can be extended to an indefinite term)

  • Highly qualified individuals
  • Highly qualified investors
  • Can contribute in scientific and technological development
  • Are internationally successful in cultural, artistic or sporting activities
  • Can contribute to the international recognition or promotion of Turkey

Independent work permit

  • Labour contract
  • Invitation letter
  • Application letter for work permit
  • Foreign personnel application form
  • Photocopy of the passport
  • Copy of the diploma or interim graduation certificate translated into Turkish by certified translators or official institutions
  • Turkey Trade Registry Gazette which shows the most recent capital and partnership structure of the organization or institution which will employ the foreign personnel
  • Balance sheet and profit/loss statement of the last year approved by the tax office or the certified public accountant

This certificate is valid for three (3) months from the date of its issue

  • Statutory managers of limited liability companies who are also shareholders of the relevant company 
  • Board of directors’ members of joint stock companies who are also shareholders of the relevant company 
  • Commandite shareholders of partnerships in commendam, the capital of which is divided into shares
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Value Added Tax (VAT) in Turkey

  • The standard rate of VAT is 18%.
  • There is also a reduced rate of 8% applied to: basic foodstuffs; medical products; books; and other, and a super-reduced rate of 1% applied to: agricultural products; certain residential properties; newspapers & periodicals; and other.

VAT

Standard Rate

Group 1083

18%

Reduced Rate Group 1083 8%
Reduced Rate Group 1083 1%
Zero Rate Group 1083 0%
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Mandatory Benefits in Turkey

  • These are mandatory benefits as postulated by law
  • These include probationary period, public holidays, annual leave, sick leave, maternity leave, parental leave, overtime pay, notice period, and severance pay
  • Mandatory benefits also include social security benefits.
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Mandatory Benefits overview

  • Probationary period

  • Annual Leave

  • Public Holidays

  • Sick Leave

  • Maternity Leave

  • Paternity Leave

  • Overtime Pay

  • Notice period

  • Severance Pay

  • Social Security Benefits

Payments And Invoicing

  • Tax is imposed on a calendar-year basis in Turkey.
  • Employers must withhold income tax from salaries and wages paid to employees.
  • All withholding taxes must be declared monthly on the 23rd day and paid on the 26th day of the month following the month of payment (in cash or by accrual).
  • A taxpayer who derives commercial or self-employment income must file and pay advance income tax quarterly.
  • The advance tax amount equals 15% of net income.
  • The advance payments must be made by the 17th day of the second month following the end of the quarterly tax period.
  • Advance tax paid is deducted from the income tax payable in the final tax return.
  • Annual income tax returns must be submitted to the tax authorities between 1 March and 31 March of the following year.
  • The balance of tax due must be paid in two equal installments in March and July.
  • Nonresidents are generally not required to file income tax returns if they have only earnings subject to withholding tax.
  • Nonresident individuals or Turkish citizens who reside in Turkey with the intention of staying or nonresident individuals who derive income not subject to withholding tax must file annual income tax returns for other sources of earnings, including commercial income.
  • If nonresident individuals having such earnings leave Turkey, they must file an “occasional” tax return 15 days before their departure.

Payroll Accrual in Turkey

Country Accruals Additional Information

Social security contributions 2.00%
Disability, old age, death 11.00%
General health insurance 7.50%
Unemployment 2.000%
maternity 12 weeks
Vacations 7.26%
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Description

All employees, including foreign nationals, are subject to compulsory social security. Only the application of unemployment insurance is exceptional for a foreigner, depending on the existence of reciprocal provisions between their home country/jurisdiction and Turkey.

On the other hand, in the case where an assignee remains in the social security system in the home country/jurisdiction and substantiates their social security coverage through a document received from the competent authority in their home country/jurisdiction, they are not subject to social security in Turkey.

Contributions are payable by both the employer and the employee based on the employee’s salary. The rates stated above are applied to the gross total of salaries, wages and bonuses up to a current maximum monthly of TRY19,188.00 for the whole year 2019. In calculating the income withholding tax on the wages by the employer, the employee contribution is deducted from the withholding tax base.

Payroll Accruals Additional Information

      Employment Accruals
Annual Leave

Employees are entitled to paid annual leave, provided that they have worked for at least one year, including the probationary period. Paid time off is dependent on the number of years of service:

  • Years 1-5: 14 working days
  • More than 5 years but less than 15: 20 working days
  • 15 years or longer: 26 working days
  This equals 3.83% (14/365 days) of annual income
Maternity Leave Pregnant women are eligible to receive 8 weeks of maternity leave preceding and following childbirth.   This equals 15.38% (8/52 weeks) of annual income
Paternity Leave Fathers are allowed a parental leave of up to three days.   This equals 0.82% (3/365 days) of annual income
Sick Leave In accordance with article 46 (c) of the Turkish labor law, all employees are entitled to maximum one week paid sick leave upon production of confirmative medical report.   This equals 1.92% (1/52 weeks) of annual income
Overtime  If working hours exceed 45 in a week, employees are entitled to overtime pay.
This includes increasing the employee’s regular hourly rate by 50%.
In lieu of payment, employees may be granted 1.5 hours of ‘free time’ for every overtime hour worked.
Overtime rates may be increased on the basis of a collective bargaining agreement or employment contract.
The total number of overtime hours may not exceed 270 hours per year.
  Overtime is paid at an additional 48 TRY
Severance The severance payment is calculated by multiplying the employee’s last 30 days’ gross wage by the number of years employed   This equals 8.22% (30/365 days) of annual income
Social Security Employers must make the following contributions: - Social Security 20.5%; Unemployment Insurance 2%.   This equals 22.5% of annual income

Accrued Benefits in Turkey

Christmas Bonus % 0%
Christmas Bonus Over Vacations % 0%
Severance per Year%

Employees are entitled to severance pay equal to one month's pay after completion of one year of employment (8.33% of annual salary)

8.33%
Vacations %

Employees who hve worked for 1 to 5 years are entitled to 14 days of annual leave (4.12% of annual salary)

4.12%
Of annual
salary
Notice %

Employees are entitled to 20 day notice period for one year of service or more (5.49%)

5.49%
Christmas Bonus Over Notifications % 0%
Vacations Plus % 0%

Total percentage of Salary (yearly)

The total employment accruals as a percentage of salary per annum

17.85%

Why use Global Expansion to hire in Turkey

Establishing a branch office or subsidiary in Turkey can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Turkey labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Turkey law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Turkey. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Turkey Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.

 

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