A significant tax advantage is on the agenda for manufacturing companies and agricultural production institutions that possess an industrial registration certificate.
An important corporate tax regulation closely affecting the production and agricultural sectors in Turkey has been approved by the Grand National Assembly's Planning and Budget Committee. According to the approved proposal, the profits exclusively derived from production activities of institutions that possess an industrial registration certificate and are actually engaged in production activities with the profits that institutions engaged in agricultural production activities obtain from these production activities corporate tax rate for %12,5 It is planned to be implemented as follows.
This regulation could create a significant financial advantage for manufacturing companies and agricultural production institutions, considering the current general corporate tax rate. However, the regulation is still in the legislative process; the details of its implementation will become clear after it is approved by the Grand National Assembly and published in the Official Gazette.
What does the regulation bring?
The current corporate tax rate is... %25 This is how it is implemented. With the new regulation, the corporate tax rate for producers and agricultural production institutions that meet certain conditions is applied only to the profits they obtain from their production activities. %12,5 It is planned to be implemented as follows.
The most important detail at this point is this:
The reduced rate will apply only to earnings from manufacturing or agricultural production activities, not to all company earnings.
Therefore, the general corporate tax rate may continue to apply to non-production business income, financial income, rental income, or earnings from other activities. For this reason, it is crucial for firms to properly separate their production income from other income streams.
Who can benefit?
Institutions that can benefit from the regulation can be broadly categorized into two groups:
- Manufacturers holding an industrial registration certificate
Companies that possess an industrial registration certificate and are actively engaged in production activities will be able to benefit from a reduced corporate tax rate for profits derived exclusively from their production activities.
At this point, simply possessing an industrial registration certificate may not be sufficient. The company must be actively engaged in production, and the income to which the deduction will be applied must genuinely stem from production activities.
- Institutions engaged in agricultural production activities
Institutions engaged in agricultural production activities are also expected to benefit from a 12.5% rate exclusively on profits derived from these production activities.
Therefore, it would be beneficial for agricultural companies to review their operational structure, revenue sources, and accounting records in light of this regulation.
Which earnings will be covered?
At the heart of the regulation "profits derived exclusively from production activities" The statement indicates that the reduced rate will only apply to profits arising from production.
Therefore, companies will need to make the following distinction:
- Profits derived from production activities
- Profits derived from agricultural production activities
- Commercial trading income
- Service revenues
- Financial income
- Rental or other incidental income
- Export revenues
- Intra-group or mixed activity revenues
Income separation will become critical, especially for companies involved in both manufacturing and trading. Incorrect classification could pose a risk during future tax audits.
Will it be applied together with the export discount?
According to the adopted regulation, the existing rate applied to export earnings will also apply to earnings benefiting from this reduced rate. 5-point discount It will not be implemented.
Therefore, manufacturing and exporting companies need to evaluate both their existing tax advantages and the advantages that will arise from the new regulation. The most suitable financial impact for each company may vary depending on its production, export, domestic sales, cost, and profit structure.
What preparations should companies make now?
Although the regulation is still in the legislative process, it would be beneficial for manufacturing companies and agricultural production institutions to prepare in advance.
The following topics, in particular, should be reviewed:
Sanayi sicil belgesi kontrolü
It should be checked whether the industrial registry certificate is available, valid and compatible with the field of activity.
Actual production status
Whether the company is actually engaged in production activities should be evaluated based on its production infrastructure, capacity, personnel structure, and activity records.
Income segregation
Production profits and other income items should be separated for accounting and financial record purposes.
The relationship between exports and production.
İhracat yapan firmalarda üretim kazancı, ihracat kazancı ve diğer gelir unsurları birlikte analiz edilmelidir.
Evaluation in conjunction with other incentives
A holistic incentive strategy should be created, encompassing investment incentives, R&D tax credits, TÜBİTAK support, KOSGEB support, export support, and other financial advantages.
How can GrantSary provide support in this process?
GrantSary olarak üretici firmalar ve zirai üretim yapan kurumlar için bu tür düzenlemeleri yalnızca bir vergi haberi olarak değil, strategic incentives and growth opportunities We consider it as such.
Within this scope, we offer support to companies in the following areas:
- Sanayi sicil belgesi uygunluk kontrolü
- Fiili üretim faaliyeti ön analizi
- Preliminary assessment for the separation of production profit and other income.
- Compliance work coordinated with financial advisors and finance teams.
- Evaluating export, production, and incentive advantages together.
- An integrated incentive roadmap encompassing investment, R&D, KOSGEB, TÜBİTAK, and export support.
- Monitoring legislative changes.
- Preparing a feasible action plan specific to the company.
The aim here is not simply to see if the company can benefit from the new regulation. The main objective is to help the company build a stronger financial and strategic structure by evaluating all grants, incentives, tax advantages, and support mechanisms together.
Why is preliminary analysis important?
Not every manufacturing company may benefit from this regulation in the same way. This is because, in order to qualify for the reduced rate, it is not only the company's status as a manufacturer that matters, but also the nature of its earnings, its documentation status, its operational structure, and its income breakdown.
Therefore, the preliminary analysis study provides the company with answers to the following questions:
- Is my industrial registration certificate sufficient for this advantage?
- Can my actual production activity be considered within the scope of the regulation?
- Which of my incomes are eligible for the reduced rate?
- How should my non-production income be categorized?
- How should the export discount be evaluated?
- How can the most advantageous structure be established, along with other incentives?
- How should we prepare for 2027 and beyond?
The regulation, which stipulates a 12.5% corporate tax rate for profits derived from production and agricultural activities, could create a significant opportunity for manufacturing companies and agricultural production institutions. However, to properly benefit from this opportunity, careful consideration should be given to documentation, activity, profit separation, and its relationship with other incentives.
At GrantSary, we offer manufacturing companies a holistic consulting approach that addresses not only the application or document process but also all aspects of grants, incentives, R&D, investment, export, technology, and tax advantages together.
Can your company benefit from this tax advantage?
If you are a manufacturer with an industrial registration certificate or engaged in agricultural production activities, we can discuss together how your company might be affected by this regulation.
