🚢 Transit Trade via Türkiye: Effective Tax of ~1.25%, and Zero in İFM
A fair disclaimer, as always. The tax door has opened, but the banking door remains firmly in place: transit flows are a classic focus of compliance scrutiny (MASAK, sanctions screening, origin of goods, and source of funds). The setup works for those who have a clean, documented chain: contracts, bills of lading, invoices, payment flows—everything must reconcile. Any transit structure should be built from day one with the bank in mind, not just the tax office.
If you purchase goods in one country and sell them to another without bringing them into Türkiye, this is now almost entirely untaxed. The conditions and potential pitfalls are outlined below.
What is offered.
Under legislative package No. 7582, corporate taxpayers deduct 95% of profits from the tax base for two types of operations:
- Classic transit: goods purchased abroad and sold abroad, without physically entering Türkiye.
- Intermediation in foreign transactions: both the seller and the buyer of the goods are located outside Türkiye.
The math: out of 100 liras of transit profit, only 5 are taxed; at a 25% statutory rate, this yields an effective rate of 1.25%. For companies in the Istanbul Financial Center (İFM) holding a participant certificate (katılımcı belgesi) and in approved industrial zones, the deduction is 100%—meaning zero tax on transit profits.
Why this is stronger than it looks.
The service export incentive has a well-known trap: the minimum corporate tax (10% of profit before deductions) eats into company benefits. Here, that trap was eliminated by a specific amendment: the transit deduction is expressly accounted for in calculating the minimum tax base. This means a company genuinely achieves a 1.25% rate—and zero in İFM—without the pitfall that disrupts the entire picture for service exporters.
Conditions—all mandatory:
- The goods must not clear customs in Türkiye (they are either not brought into the country or move under a transit customs regime).
- In intermediation transactions, both counterparties must be outside Türkiye.
- The key requirement: the profit must be repatriated to Türkiye before the filing deadline for the annual corporate income tax return. If you miss the deadline, the incentive is forfeited permanently, even if the funds are repatriated later. If repatriated only partially, the deduction applies solely to the repatriated portion.
- Separate accounting: revenue, cost of goods sold, and expenses related to transit operations must be tracked separately and not commingled with other business activities.
- This is a deduction, not an exemption: it applies only against taxable profit, cannot be used in a loss-making year, and cannot be carried forward to future periods.
Additional bonuses.
VAT does not arise at all; because the transaction takes place outside Türkiye, invoices are issued without KDV. This applies to profits starting January 1, 2026, and is applied for the first time as early as the third quarterly provisional tax period of this year.
Who benefits from this.
Trading companies, re-exporters, procurement offices, and intermediaries operating between Asian manufacturers and markets in Europe, the Middle East, and the CIS. Türkiye has always been a logistically convenient hub; now it has also become tax-competitive for this business model, offering an effective rate lower than many traditional trading jurisdictions.
The takeaway: transit trade via a Turkish company has become one of the most cost-effective legal regimes in the region: an effective 1.25% rate, zero in İFM, no VAT, and no minimum tax trap. However, the incentive hinges on strict compliance: timely repatriation of profits, separate accounting records, and pristine documentation. Those who set this up properly from day one will gain a viable trading hub rather than a dispute with the tax authority.