Open menu

2023 II. Period Statutory Deductions on Payroll

2023 II. Period Statutory Deductions on Payroll

The statutory deductions applicable in a standard Turkish payroll are social security premium, income tax, and stamp tax. Also, the salaries generated from liaison offices in Türkiye are exempt from income tax per Article 34/14 of Income Tax Law, and these are only subject to social security.

Also, the income tax exemption as much as the income tax deduction amount calculated over the minimum wage for all wages introduced in 2022 will continue in 2023 as well.

Social Security Premium

Social Security Premium is calculated over wages monthly and paid jointly by the employee and the employer. The contribution rates are as follows:

Employee Employer
SSI Premium %14 %20,5
SSI Unemployment Premium %1 %2
Total %15 %22,5
Discount** %5
Total - With the Discount %15 %17,5

**Timely payment of social security premiums by the employer is a pre-condition for applying the employer discount (Incentive No. 5510.)

The rates above are applied to the social security base consisting of gross wages, bonuses, and other payments subject to social security premiums.

However, if the social security base is higher than the social security premium ceiling, which is renewed every year, the social security premium ceiling amount valid for that period is considered to calculate the premiums.

As of July 1st, 2023, the social security ceiling amount is 100,608.90 TRY. This ceiling amount is updated annually according to the changes in the minimum wage (7.5 times the minimum wage).

SSI Base and Ceiling

Period Monthly SSI Base Monthly SSI Base Ceiling
2023 II. Period 13,414.50 TRY 100,608.90 TRY

2023 Liability for Income Tax

Per the Income Tax Law, Article 1, the tax year is the calendar year in Türkiye, and there is a cumulative income tax system that follows the calendar year. The applicable tax rate is determined based on the year-to-date cumulative income tax base of the employee. Therefore, the tax rate of the employees will increase throughout the year as their cumulative income tax base increases.

Below are the income tax brackets that are applicable for the salary income on 2023 tax year (Income Tax Communique No. 323):

Minimum Maximum %
0 70,000.00 15%
70,000.01 150,000.00 20%
150,000.01 550,000.00 27%
550,000.01 1,900,000.00 35%
1,900,000.01 and more   40%

2023 Income Tax Exemption

The income tax exemption as much as the income tax deduction amount calculated over the minimum wage for all wages introduced in 2022 will continue in 2023 as well.

Liability for Stamp Tax

The stamp tax is applied on employment income through the payroll. The applied rate is 0,759 percent as of January 1, 2015.

The stamp tax base equals the total gross earning on the payroll, and the stamp tax is calculated over that total gross earning.

The stamp duty exemption for all wages brought in 2022 up to the minimum wage level will continue in 2023 as well.

2023 Minimum Wage Tax Exemptions

The increase in the minimum wage as of July 1, 2023, has also affected the exemption amounts for July and subsequent months.

Period Income Tax Exemption Stamp Tax Exemption
January 1,276.02 75.96
February 1,276.02 75.96
March 1,276.02 75.96
April 1,276.02 75.96
May 1,276.02 75.96
June 1,276.02 75.96
July 1,710.35 101.82
August 1,902.62 101.82
September 2,280.46 101.82
October 2,280.46 101.82
November 2,280.46 101.82
December 2,280.46 101.82

Minimum Wage Sample Calculation as of July 1st, 2023

Gross Minimum Wage 13,414.50 TRY
SSI Employee (%14) 1,878.03 TRY
Unemployment Employee (%1) 134.15 TRY
Total Deduction 2,012.18 TRY
Net Minimum Wage 11,402.32 TRY

Minimum Wage Employer Cost Calculation Sample as of July 1st, 2023

Gross Minimum Wage 13,414.50 TRY
SSI Employer (%20.5) 2,749.97 TRY
Unemployment Employer (%2) 268.29 TRY
Employer Cost (without discount of 5%) 16,432.76 TRY
Employer Cost (with a discount of 5% 15,762.04 TRY

Sample Calculation- 2 as of July 1st, 2023

Monthly Gross Salary 30,000.00 TRY
SSI Employee (%14) 4,200.00 TRY
Unemployment Employee (%1) 300.00 TRY
Total SSI Deduction 4,500.00 TRY
Income Tax Base 25,500.00 TRY
Income Tax Amount (%15) 3,825.00 TRY
Income Tax Exemption 1,710.35 TRY
Income Tax Payable 2,114.65 TRY
Stamp Tax Base (Before Exemption) 30,000.00 TRY
Stamp Tax Base Exemption 13,414.50 TRY
Stamp Tax Base (After Exemption) 16,585.50 TRY
Stamp Tax Payable 125.88 TRY
Total Deduction Amount 6,740.54 TRY
NET WAGE 23,259.46 TRY

2023 Payroll Calculation Method Sample

You can find below a sample calculation process from gross salary to net salary;

  • Total gross earning: gross base salary + all benefits and allowances
  • Gross base salary: monthly base salary / 30 * working days of the employee
  • SSI base: total gross payment – exemptions (i.e., in-kind meal allowance)
  • SSI employee contribution: Social security base * 0.14
  • SSI employee unemployment contribution: social security base * 0.01
  • SSI employer contribution: social security base * 0.205
  • SSI employer unemployment contribution: social security base * 0.02
  • Cumulative income tax base: Current income tax base + cumulative income tax base from the previous months
  • Income tax base: total gross payment – SSI employee contribution – SSI employee unemployment contribution
  • Income tax: income tax base * tax rate
  • Income tax exemption: The tax amount calculated over the applicable minimum wage
  • Income tax payable: Income tax – income tax exemption
  • Stamp tax base (before exemption): total gross payment
  • Stamp tax base exemption: Monthly gross minimum wage amount
  • Stamp tax base (after exemption): Stamp tax base – stamp taxe base exemption
  • Stamp tax: stamp tax base * 0.00759
  • Total employee deduction: SSI total employee contribution + income tax + stamp tax
  • Net payment: total gross payment - total employee deduction

The tax rate of the employees will increase throughout the year as their cumulative income tax base increases. As the cumulative income base of the employee change, the tax bracket of the employee changes as well. The income tax bracket for January can be 15%, and in February, the tax bracket would be increased and can be 20% due to an extra bonus payment.

You can reach the official announcement of the minimum wage amount applicable as of July 1st, 2023 via the link (In Turkish).

You can reach Income Tax Communique No. 323 via the link (In Turkish).

You can reach Stamp Tax Communique No 66 via the link (In Turkish).

You can reach Stamp Tax Table via the link (In Turkish).

Should you have any queries or need further details, please contact your customer representative.

Written by İrem Güner, Posted in Social Security Law and Legislation, Taxation Law

  • Notification!

    Contents provided in this article serve to informative purpose only. The article is confidential and property of CottGroup® and all of its affiliated legal entities. Quoting any of the contents without credit being given to the source is strictly prohibited. Regardless of having all the precautions and importance put in the preparation of this article, CottGroup® and its member companies cannot be held liable of the application or interpretation of the information provided. It is strictly advised to consult a professional for the application of the above-mentioned subject.

    Please consult your client representative if you are a customer of CottGroup® or consult a relevant party or an expert prior to taking any action in regards to the above content.

About The Author

İrem Güner

Senior Client Relations Specialist
This website is using cookies.
In this website, we use cookies to develop your user experience, obtain efficient work and track statistical data. You are agreeing to our use of cookies by browsing our website. Please review Çerezler (Cookies) page for detailed information of how we manage the cookies. This choice is valid for 30 days until you delete the cookies in your web browser.