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Venture capital fund Investment allowance Venture capital fund can be set aside from the profit of relevant The investment allowance exemption carried from 2005, if period or declared income in order to be invested in venture any, may be finally deducted from the profit of 2013 remaining capital investment partnerships established or to be established after all abovementioned deductions are applied. There is no in Turkey or to acquire venture capital investment fund shares. limitation on this deduction in terms of amount or ratio. If there This fund may not exceed 10 percent of corporate profit or is still an amount which cannot be deducted since the profit of declared income and 20 percent of shareholders’ equity. 2013 is insufficient, it can be carried forward by indexing same as before. In case taxpayers do not make the specified investments until the end of the year when the fund is set aside, taxes not New deduction; Sheltered business place accrued in time are collected together with delay interest. According to the regulation on the establishment of sheltered The portion of amounts set aside as venture capital fund not business places, for establishing such business places, eight or exceeding 10 percent of declared income may be deducted more people with at least 40% mental or psychological disability from corporate profit provided that it is separately shown on and at the age of at least 15 registered in Turkish Labor Agency the tax return. This fund must be definitely used in line with its must be employed. Secondly, the ratio of disabled individuals purpose. It is taxed in case it is withdrawn from the enterprise, employed in sheltered business places to the total number of distributed to shareholders or in cases such as cease of workers must be no less than 75 percent. The employer of the business, liquidation, transfer-merger etc. business place which fulfills these conditions applies to the Provincial Directorate of Family and Social Policies in order to Services provided to abroad be entitled to sheltered business place status. Another right of deduction is related to the architecture, On the other hand, law no. 6518 has introduced a new engineering, design, software, medical reporting, accounting, deduction practice for the wage payments made to the disabled call center and data storage services rendered in Turkey for individuals working in these business places. Pursuant to the foreign persons and entities and benefitted abroad. Half of law which became effective on 19 February 2014, 100 percent the profit which these service businesses derive from the of the annual gross amount of these wage payments can be abovementioned activities may be deducted from corporate treated as deduction in the corporate tax return. The deduction profit. can be benefited even if these wages are undertaken by other persons and entities. Companies operating in education and health industry may similarly deduct half of the profit they derive from these However, it should not be forgotten that the deduction may be services rendered in Turkey for foreigners. However, these applied for maximum five years for each disabled employee. companies must provide education and health services under Furthermore, the amount to be deducted annually may not the permit and inspection of the relevant ministry. exceed 150 percent of the annual gross amount of minimum wage for each disabled employee. Finally, it should not be forgotten that the invoices related to all of the services above rendered in Turkey for foreigners must be Sheltered business places which are expected to begin issued in the name of the foreign customer. operations starting from this year are expected to benefit from this deduction opportunity as from 2014. In this case, this deduction will be taken into account as the last deductible item in the tax return (before the investment allowance line). 14 Nisan 2014 Nisan 2014