About Turkish KDV (VAT)
KDV — Katma Değer Vergisi — is Turkey's value-added tax, equivalent to VAT in Europe. In July 2023, Turkey undertook a major VAT reform, raising the standard rate from 18% to 20%, the reduced rate from 8% to 10%, and maintaining the lowest rate at 1%. These changes took effect from 10 July 2023 and remain in force through 2024.
The 20% standard rate applies to most goods and services including electronics, clothing, vehicles, construction, and professional services. The 10% reduced rate covers food products sold in restaurants and cafes, hotel accommodation, health services, and certain agricultural goods. The 1% rate applies to basic food staples sold in retail such as fresh produce, bread, and essential agricultural products.
Turkish businesses registered for KDV must file monthly or quarterly returns with the Revenue Administration (Gelir İdaresi Başkanlığı — GIB). The KDV invoice (KDV faturası) must clearly show the pre-tax price, rate applied, KDV amount, and total price including KDV.
Frequently Asked Questions
Turkey has three KDV rates as of 2024: 20% (standard, applies to most goods and services), 10% (reduced, for restaurants, hotels, health services, some food), and 1% (lowest, for basic food staples like fresh vegetables, fruit, and bread). These rates were updated in July 2023 under Turkey's tax reform package.
To remove KDV from a VAT-inclusive price, divide the total by (1 + rate). For 20%: divide by 1.20. For 10%: divide by 1.10. For 1%: divide by 1.01. The result is the pre-tax price, and the difference is the KDV amount. Our calculator does this automatically — select "Remove KDV" mode and enter the VAT-inclusive price.
The 1% KDV rate applies to basic food staples sold in retail settings, including fresh fruits and vegetables, eggs, milk, bread, and other essential agricultural products. It also applies to certain newspapers and periodicals. This rate is designed to keep essential goods affordable for consumers. Note that the same food items sold in a restaurant or cafe are subject to the 10% rate.
Yes, Turkey exempts certain transactions from KDV entirely (0% / exempt). These include exports of goods and services, international transportation, services provided to diplomatic missions, and certain financial and insurance services. Businesses engaged in exempt transactions may not deduct input VAT on related purchases. Foreign tourists can also claim a VAT refund on purchases over a minimum threshold through the Tax Free Shopping scheme.