ARTICLE 393- Service contract is an agreement where the worker undertakes to work dependent to an employer for a definite or indefinite term and The employer undertakes to pay a wage according to the work done.

Any contracts where the worker undertakes to give a service as a regular basis as a part-time is also a service contract.

Provisions relating to general service contract apply to apprenticeship contracts as well by analogy, special regulatory provisions are reserved.

B. Establishing

Dear Valued Client,

We would like to remind you about a development which will enter into force on October 2018 unless any delay occurs.

Overview

Pursuant to the 18/2/2017 dated General Statement on the Withholding Tax Return and Monthly Premium & Service Declarations which is published in the 29983 numbered Official Gazette, it is announced that WITHHOLDING declaration that should be provided due to tax legislation and MONTHLY PREMIUM & SERVICE DECLARATION which should be provided due to 5510 numbered Social Securities and General Health Insurance Law, are to be combined under a single return called “Withholding Tax and Premium Service Return”. Afterward, this transition process is delayed several times because of technological infrastructure and practical difficulties. Most recently, the implementation is extended to the date of 01.10.2018 with the revision on the “General Statement on the Withholding Tax Return and Monthly Premium & Service Declarations” (Item No:1) published within 30345 numbered and 29.05.2018 dated Official Gazette by the Ministry of Finance.

In the recent days, several banks are demanded an explanation from the receiver with blocking the foreign currency units over 50.000 USD which are Transferred from Abroad, because of their notification and explanation liability to the Turkish Central Bank.

The foreign companies to transfer money with foreign currency to Türkiye, shall be provided against possible delays with respect to payment dates and contractual obligations. It is important to fulfill the obligation of declaration and statement by the receiver party not to be subject of any trouble.

It has been announced on our website that we have expecting upcoming statements due to uncertainty regarding both the market expectation and the decree interpretation after the Presidential Decree which is published on the date of 13.09.2018.

The Ministry of Treasury and Finance issued a press statement about the Presidential Decree with regard to converting the agreements in foreign currency into Turkish lira. However, no progress has been made yet regarding the subsidiary regulations following the press statement.