Short answer: If a person or company resident in Türkiye provides a service to a client abroad and the service is used abroad, the transaction counts as a service export. Qualifying service exports are exempt from VAT; for certain services such as software, design and engineering, part of the profit can also be deducted from the income or corporate tax base.
Conditions for a service export
- The service must be performed for a client abroad.
- The service must be used abroad.
- An invoice or freelance receipt must be issued for the fee.
- Bringing the fee into Türkiye in foreign currency and documenting it is recommended.
VAT exemption
No VAT is charged on the invoice for a qualifying service export, which keeps your price competitive for clients abroad. VAT paid on inputs related to the service may be refunded under certain conditions.
Profit deduction
A statutory percentage of the profit from exporting services listed in the law, such as software, architecture, engineering, design, data processing and call centres, can be deducted in the annual return. As the rate and scope may change with legislation, check before filing.
Documentation
- Contract or order correspondence with the client
- Invoices or freelance receipts issued
- Bank receipts for foreign-currency payments
- Records of service delivery (reports, code delivery, emails and so on)
A note for freelancers
Those working through platforms such as Upwork and Fiverr can also benefit from these advantages if they meet the conditions. Platform commissions and payment provider fees should be tracked separately in the records.
For an eligibility check and a proper document routine, see our freelance and professional accounting service.
