Employee Education Expenses Turkey – Tax Treatment Explained

Table of Contents

Introduction

Employee education expenses Turkey are becoming increasingly important for companies seeking to improve workforce quality while managing their tax responsibilities. In this article, we examine how such expenses are treated under the Turkish Income Tax Law, particularly Articles 61 and 28.

This article explores how education expenses provided to employees are treated under Turkish tax law, specifically in light of Articles 61 and 28 of the Turkish Income Tax Law (GVK).

Definition of Wage and Its Tax Relevance

Under Article 61 of the Turkish Income Tax Law, wages include not only salaries but also any monetary or non-monetary benefits provided to employees. When an employer pays for an employee’s education, this may be classified as a wage—unless specific exemptions apply.

Employee Education Expenses Turkey Under Article 28

Article 28 of the Income Tax Law in Turkey provides certain tax exemptions for education-related expenses, particularly for:

Employees and students studying abroad,
Students receiving support for education within Turkey.

However, this article creates a distinction: while education expenses for foreign education may be exempt from tax, similar expenses for domestic education in Turkey often do not benefit from the same treatment.

Tax Treatment of Employee Education Expenses Turkey

Companies in Turkey increasingly invest in employee development to stay competitive, especially in technology and R&D. These investments often include covering employee education expenses such as postgraduate degrees or language training, either in Turkey or abroad.

1. Tax Authority’s Interpretation – Official Rulings

Official tax rulings from the Turkish Revenue Administration show a mixed approach:

Domestic education expenses are generally considered as taxable wages.
Foreign education expenses may be exempt under Article 28, provided they meet certain criteria.
If the recipient is a partner/shareholder of the company—even if they are also an employee—the expense is usually treated as taxable.

2. Evaluation and Legal Criticism

The legal framework does not explicitly exclude domestic education support from exemption, but in practice, the tax authority rarely applies Article 28 for education in Turkey. Given the rise of private universities and high-quality institutions in Turkey, this distinction seems outdated.

Legal Interpretation of Employee Education Expenses Turkey

Employee education expenses are crucial for corporate development, especially in rapidly evolving sectors. However, the current implementation of Turkey’s Income Tax Law creates inconsistent outcomes:

Support for education abroad can be exempt from tax.
The same support for domestic education in Turkey is often taxed as wage.
Education support for employee-shareholders is often disqualified from exemption.

We recommend a revision of Article 28 to include tax exemption for education provided within Turkey, especially when the training directly benefits the company. Such a change would not only modernize the law but also help retain foreign currency within the country and encourage long-term human capital investment.

Tax Treatment of Employee Education Expenses in Turkey