Transfer Pricing Rules in Turkey: 2026 Guide for Foreign Investors and Group Companies

Transfer pricing remains a critical tax regulation for any multinational entity, governing the pricing of transactions—ranging from goods and services to loans and intellectual property—between related parties or associated persons. In Turkey, these regulations mandate that all intra-group transactions strictly adhere to the arm’s length principle. This framework is essential to prevent disguised profit distribution and ensure full tax transparency across borders.
At GlobalBridge Turkey, we provide a holistic approach by integrating transfer pricing compliance with tax optimisation, company formation, double taxation agreements, and investment incentive schemes. This ensures that foreign investors maintain seamless legal compliance while effectively minimising potential tax risks.
Key Legal Framework
In Turkey, the primary legislation for transfer pricing is found under Article 13 of the Corporate Tax Law No. 5520. This article is largely aligned with the OECD Transfer Pricing Guidelines, ensuring a standard that international investors will find familiar. Essentially, any transaction between related parties—including shareholders, group companies, or entities connected via management or capital—must be priced as though it were conducted between independent parties under identical circumstances.
If a transaction fails to meet the arm’s length principle, the price difference is legally classified as disguised profit distribution. Consequently, the company may face additional corporate tax assessments and withholding tax obligations.
Accepted Transfer Pricing Methods
Turkish legislation recognises five primary methods for determining the correct pricing of transactions:
Method
Application
Comparable Uncontrolled Price (CUP)
Compares prices with similar transactions between independent parties
Cost Plus Method
Adds an appropriate mark-up to the direct and indirect costs
Resale Price Method
Deducts a standard gross margin from the final resale price
Profit Split Method
Allocates combined profits based on each party’s relative contribution
Transactional Net Margin Method (TNMM)
Compares net profit margins from comparable transactions
The most appropriate method should be selected based on the specific nature of the transaction. In cases where a taxpayer cannot determine an arm’s length price using these five standard methods, they are permitted to develop and apply their own internal method.
Documentation and Reporting Obligations (2026)
Staying compliant requires rigorous documentation and reporting. The following requirements are in effect for 2026:
Local File (Annual Transfer Pricing Report)
Must be prepared by all corporate taxpayers involved in transactions with related parties.
Must be ready by the time the corporate tax return is filed.
Must be submitted to the authorities within 15 days if requested during a tax audit.
Master File
Mandatory for companies that exceed specific net sales and asset thresholds, typically set at 500 million TL or above.
Country-by-Country Report (CbCR)
Required for multinational groups with a consolidated annual group revenue of €750 million or more.
Transfer Pricing, Controlled Foreign Corporation and Thin Capitalisation Form
This form must be filed electronically as an attachment to your annual corporate tax return.
Note that transactions with an annual net total below 30,000 TL are exempt from disclosure on this form.
Advance Pricing Agreement (APA)
Taxpayers seeking long-term certainty can enter into an Advance Pricing Agreement (APA) with the tax administration. This allows for the pre-determination of pricing methods for up to 5 years, significantly reducing the risk of double taxation.
Consequences of Non-Compliance
Failure to comply with the arm’s length principle carries significant financial and legal risks:
The transaction difference is reclassified as disguised profit distribution.
The entity will be subject to additional corporate tax and withholding tax.
Tax loss penalties (ranging from 50% to 100%) and default interest will be imposed.
Given the increasing frequency of transfer pricing audits, a lack of proper documentation creates a high-risk profile for the business.
Compliance and Optimisation with GlobalBridge Turkey
Transfer pricing compliance is particularly vital for management fees, royalties, intra-group services, and the trade of goods. GlobalBridge Turkey, alongside our expert tax advisors and solution partners, provides comprehensive support in:
Preparation of local and master file documentation.
Strategic method selection and benchmarking.
Advance Pricing Agreement (APA) applications.
In-depth risk analysis.
This integrated support ensures your business remains legally compliant while preventing costly tax penalties.
Transfer pricing regulations are inherently complex and vary based on your specific corporate structure and transaction volume. The information provided here is for general guidance only. We strongly recommend developing a bespoke transfer pricing strategy and compliance plan with our professional consultants. At GlobalBridge Turkey, we operate with a philosophy of Radical Transparency, ensuring every investor takes the right steps tailored to their unique circumstances.
📞 Book a Free Consultation – Get a personalised transfer pricing compliance assessment and risk analysis for your group transactions.

LEGAL DISCLAIMER
The information provided in this article is for general informational purposes only and does not constitute professional legal, financial, or investment advice. While we strive to maintain high standards of accuracy and “Radical Transparency,” regulations and market conditions in Turkey may change frequently.
We strongly recommend consulting with our professional advisors or legal experts before taking any formal action or committing to an investment. GlobalBridge Turkey and its partners cannot be held liable for any decisions made or actions taken based on the content of this article.