R&D Center Incentives

Incentives and Support for R&D, Innovation, and Design Activities in Turkey
Overview
Turkey offers a comprehensive range of incentives to promote investment in research, development (R&D), innovation, and design activities. These incentives are provided through tax benefits, financial grants, and regulatory exemptions aimed at fostering technological advancement and competitiveness.
 
Project-Based Financial Support

Several institutions provide funding and support for R&D, innovation, and design projects:

• TÜBİTAK (The Scientific and Technological Research Council of Turkey)

• Ministry of Industry and Technology

• KOSGEB (Small and Medium Industry Development Organization)

• Regional Development Agencies

• European Commission Programs

Companies engaged in eligible projects can access direct financial support through these organizations.

Tax Incentives
Companies can benefit from significant tax advantages, including:

• 100% deduction of eligible R&D, innovation, and design expenditures from the corporate income tax base.

  • This applies to activities conducted in:

    • Certified R&D Centers (minimum of 15 full-time R&D employees),

    • Certified Design Centers (minimum of 10 full-time design employees),

    • Projects supported by government bodies, foundations, or international funding sources.

• Additional tax benefits:

  • 50% exemption on the employer’s share of social security premiums for eligible R&D and design personnel.

  • Full exemptions from stamp duty and customs duty for approved projects.

  • VAT exemption for equipment purchases used within certified R&D or design centers.

Treatment of Project Costs

• Successful project costs must be capitalized and amortized over five years.

• Unsuccessful project costs may be expensed immediately and fully deducted in the year incurred.

Incentives for Employing Fundamental Science Graduates
Companies hiring graduates from fundamental sciences (e.g., mathematics, physics, chemistry, biology, biochemistry, biotechnology, industrial design, molecular biology and genetics, metallurgy, and related engineering fields) benefit from additional support:

• For a period of two years, the government subsidizes the gross wages of R&D personnel holding undergraduate degrees in these disciplines.

Additional Incentives Based on Performance Growth
Companies demonstrating at least 20% growth in specific R&D or design-related performance metrics are eligible for further tax advantages.
Eligible growth areas include:

• The ratio of R&D/design expenses to total sales,

• The number of domestic and international patent applications,

• The amount of internationally funded projects,

• The proportion of researchers with advanced degrees,

• The ratio of researchers to total employees,

• The revenue generated from new products developed through R&D.
   

When any of these metrics improve by 20% or more year-over-year, companies can deduct an additional 50% of the increase in qualifying R&D or design expenses from their taxable income.