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Withholding to Be Applied to the Advertisement Services in Internet

Withholding to Be Applied to the Advertisement Services in Internet

The amendment of the resolutions of Council of Ministers regarding the tax deductions within the Art. 15 and 30 of the Law on Corporate Tax no.5520; and Art. 94 of the Income Tax Law no.193; and including some services in the scope of tax deduction under Art. 11/7 of the 213 numbered Tax Procedure Law, is determined with the Presidential Decree (the “Decree”) no. 476 on 18.12.2018.

The related Decree has taken the payments made to the ones that provide or mediate to provide the service online, into the scope of the tax deduction without considering whether these payers are taxpayers or not.

As you may recall, the President is authorized to determine different deduction ratios providing these ratios are in between the limits designated in the tax laws, with the amendment of Art. 11 of 6745 numbered Tax Procedure Law published in the Official Gazette on 07.09.2016. The withholding ratios to be applied to the payments made to the online advertisement providers/mediators shall be as follows according to the Decree which is published with respect to this Art.11:

  • 15% for the payments to the individuals according to the Art.94 of the Income Tax Law;
  • 0% for the payments made to the fully responsible taxpayer institutions, according to the Art. 15 of the Corporate Income Tax Law;
  • 15% for the payments made to the limited taxpayer institutions, according to the Art. 30 of the Corporate Income Tax Law.

The Decree is effectuated on the date of issue to be performed for the payments made as of 01.01.2019 and shall be executed by the Ministry of Treasury and Finance.

You may reach the Official Gazette including the full text of the amendments made with the annex of the Presidential Decree via this link.

Written by Selma Kıy, Seda Arıcı, Posted in Taxation Law

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About The Author

Selma Kıy

Certified Public Accountant - SMMM

Seda Arıcı

Legal Consultant | Attorney
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