Start with the actual activity
Manufacturing, trading purchased goods and providing services require different assessments. Begin with the operating licence, the work actually performed and the transactions producing the profit. Any transitional provisions linked to the licence date and duration also need review.
The 2026 change for manufacturing profits
Law No. 7577 extended the relevant exemption for products manufactured in a free zone to sales within that zone and to other free zones, in addition to foreign sales. It applies to income earned from 1 January 2026. Sales to other parts of Türkiye should not be confused with those destinations.
Separate manufacturing and trading
A business may sell both its own products and goods purchased from elsewhere. Recording everything together makes it harder to identify the profit attributable to each activity. Product-level costs and sales records help support the exemption calculation.
Consider VAT separately
The income or corporate tax exemption does not automatically determine the VAT treatment. The nature and location of the supply need separate review. A customer’s free-zone address is not a blanket reason to issue every invoice without VAT.
Build the transaction file
Keep operating licences, manufacturing and trading records, invoices, dispatch or customs documentation, and cost allocations together. A clear separation of qualifying and other income helps identify the issues that need detailed review.