What is a Withholding Tax Return in Türkiye?

Who must file a Withholding Tax Return?

When is a Withholding Tax Return filed? How is a Withholding Tax Return prepared?

 

All businesses are required to submit regular written statements, either monthly or quarterly.

Businesses are required to regularly declare their income, expenses, wages and insurance premiums paid to their employees, and rent payments in writing.

Businesses are responsible for the tax amount on their tax return. A withholding tax return is one type of return. If you want to learn what a withholding tax return is and when and who is required to file one, you're in the right place.

 

What is a Withholding Tax Return?

 

A withholding tax return is the written declaration, or declaration, of the tax amounts, including employee withholding tax rates, rent withholding tax information, and self-employment withholding tax information, to the relevant tax office.

According to Article 84 of the Income Tax Law, "A withholding tax return is for the collective reporting of taxes withheld by employers or other persons performing tax withholding, together with their tax bases, to the tax office." In other words, employers, not employees, are responsible for the withholding tax return. Employers are also responsible for the amount of tax due.

 

When is a Withholding Tax Return Submitted?

 

The withholding tax return submission periods are divided into two: monthly or quarterly. This difference varies depending on the employer's information.

 

If a business has no employees, the withholding tax return is submitted quarterly, meaning the rent and self-employment tax rates are reported collectively every three months. However, if there are employees, the workers', rent, and self-employment tax rates must be reported monthly.

 

Monthly withholding tax returns must be submitted by the 26th of each month. Returns prepared quarterly must be filed by the 26th of the last month of each quarter.

 

 

 

 

How is a Withholding Tax Return Prepared?

Withholding tax returns are prepared by personnel in the company's relevant accounting department or by the company's financial advisor, based on the company's information.

There are different codes for each item to be reported on the withholding tax return. Withholding tax rates are calculated and recorded separately. These codes vary depending on the employee's wages. For example, those earning minimum wage are typically processed with code 011, while those earning wages higher than minimum wage are processed with code 012.

The codes commonly used when preparing a withholding tax return are as follows:

011 Minimum wage workers

012 Other salaried workers

013 Severance pay payments

014 Attendance allowances

015 Notice pay payments

021 Payments covered by Article 18

022 Other self-employment income payments

041 Payments made for the rental of goods and rights listed in Article 70

There are many codes such as these. The person preparing the return prepares the return by selecting the appropriate code based on the information the business needs to declare. It is very important that the returns are filed regularly and in a controlled manner.