ARTICLE
22 October 2021

Remote Working Period Increased For Technology Development Zones And R&D/Design Centers

EA
Esin Attorney Partnership

Contributor

Esin Attorney Partnership, a member firm of Baker & McKenzie International, has long been a leading provider of legal services in the Turkish market. We have a total of nearly 140 staff, including over 90 lawyers, serving some of the largest Turkish and multinational corporations. Our clients benefit from on-the-ground assistance that reflects a deep understanding of the country's legal, regulatory and commercial practices, while also having access to the full-service, international and foreign law advice of the world's leading global law firm. We help our clients capture and optimize opportunities in Turkey's dynamic market, including the key growth areas of mergers and acquisitions, infrastructure development, private equity and real estate. In addition, we are one of the few firms that can offer services in areas such as compliance, tax, employment, and competition law — vital for companies doing business in Turkey.
Presidential Decree No. 4625, published in the Official Gazette dated 17 October 2021, increased the period for employees to spend up to 50% of the total working hours out of...
Turkey Tax

Presidential Decree No. 4625, published in the Official Gazette dated 17 October 2021, increased the period for employees to spend up to 50% of the total working hours out of R&D or design centers and technology development zones until 31 December 2022, within the scope of the withholding tax incentive applied for these centers and zones.

What does Presidential Decree No. 4625 mean?

Under Temporary Article 2 of Law No. 4691 on Technology Development Zones and Article 3 of Law No. 5746 on Promoting Research, Development and Design Activities, the working periods that employees spend out of technology development zones and R&D or design centers are deemed within the scope of the withholding tax incentive, provided that the period spent out of these zones and centers does not exceed 20% of the total working period pertaining to the application of the incentive and the period outside of zones and centers is directly related to the projects carried out in these zones and centers. The president can increase the percentage to up to 50%.

Presidential Decree No. 4625 increased the percentage from 20% to 50% to be effective until 31 December 2022. The decree came into effect on 17 October 2021.

Conclusion

Within the scope of the withholding tax incentive applied to technology development zones and R&D or design centers, the percentage of the working periods that can be spent out of technology development zones and R&D or design centers has been increased from 10% to 50% until 31 December 2022.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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