What is stopaj (withholding tax)?
Stopaj is Türkiye’s tax withheld at source: the payer deducts tax from defined payments and remits it to the tax office on the payee’s behalf. It runs through the Income Tax Law (Art. 94) and Corporate Tax Law (Arts. 15 and 30, the latter for payments to non-residents) and is collected via monthly withholding returns.
The payments a startup actually withholds on
The everyday list: employee salaries (income tax withheld through payroll); office rent paid to individuals; professional fees to self-employed persons (lawyers, accountants, freelancers); dividends to individual or foreign shareholders; and — the one that surprises founders — cross-border payments to non-resident providers for professional services, royalties and software licences, where the Turkish payer must withhold under CTL Art. 30 unless a double-tax treaty reduces the rate. Rates are set by Presidential decision and change; verify per payment type at the time of payment rather than budgeting from memory.
The classic mistakes
Four recur in diligence. Treating foreign SaaS and licence invoices as withholding-free when the character of the payment (royalty vs. service vs. sale) says otherwise; forgetting reverse-charge VAT that often accompanies the same invoice; grossing up contracts silently — a “net of tax” clause makes the Turkish payer bear the stopaj, repricing the deal; and missing treaty relief because no tax-residency certificate was collected from the counterparty. Each is findable in a one-hour ledger review, which is exactly what a buyer’s tax diligence does.
Is stopaj a final tax?
Sometimes — for many individual payees withholding is final; for companies it is generally an advance credited against assessed tax. The distinction drives who cares about the paperwork.
Does stopaj apply to payments to foreign contractors?
For independent professional services rendered by non-residents, withholding under Art. 30 is the default; treaties typically remove it if the provider has no Turkish fixed base and stays under presence thresholds — with the residency certificate as the price of relief.
Related: VAT, transfer pricing.