Transfer pricing is one of the most critical compliance areas for multinational companies operating in Turkey. The Turkish Revenue Administration has aligned its transfer pricing regulations with OECD guidelines, and enforcement has intensified significantly in recent years. This guide explains the transfer pricing framework in Turkey for 2026, including documentation requirements, penalties, and best practices.
What is Transfer Pricing?
Transfer pricing refers to the pricing of transactions between related parties — such as a Turkish subsidiary and its foreign parent company. Turkish tax law requires that these transactions be conducted at arm’s length prices — meaning the prices must be comparable to what independent parties would agree to in similar circumstances. If transfer prices are not at arm’s length, the Revenue Administration can adjust the taxable income, resulting in additional tax liabilities and penalties.
Turkish Transfer Pricing Regulations
Transfer pricing in Turkey is primarily governed by Article 13 of the Corporate Tax Law (Law No. 5520) and detailed in the Transfer Pricing General Communiqué. The regulations follow OECD Transfer Pricing Guidelines and cover:
- Definition of related parties (shareholders with 10%+ ownership, group companies, companies sharing common management)
- Arm’s length principle and acceptable transfer pricing methods
- Documentation and reporting requirements
- Advance Pricing Agreements (APAs)
- Corresponding adjustments and mutual agreement procedures under DTAs
Accepted Transfer Pricing Methods
Turkey accepts five transfer pricing methods, consistent with OECD guidelines:
- Comparable Uncontrolled Price (CUP): Most preferred method; compares prices in controlled transactions to comparable uncontrolled transactions
- Cost Plus Method: Adds an appropriate markup to the cost of goods or services
- Resale Price Method: Subtracts an appropriate margin from the resale price to a third party
- Transactional Net Margin Method (TNMM): Compares the net profit margin of the controlled transaction to comparable independent transactions
- Profit Split Method: Splits the combined profit from a controlled transaction based on the relative contributions of each party
Documentation Requirements
Turkish transfer pricing documentation follows a three-tier structure aligned with the OECD BEPS Action 13:
- Master File (Ana Dosya): Required for companies that are part of a multinational group. Contains organizational structure, group business overview, intangibles, intercompany financial activities, and group financial and tax positions
- Local File (Yerel Dosya): Required for all companies with related-party transactions. Contains detailed information about the Turkish entity’s transactions, functional analysis, transfer pricing methods applied, and comparability analysis
- Country-by-Country Report (CbCR / Ülke Bazlı Raporlama): Required for multinational groups with consolidated revenue exceeding 750 million EUR. Filed by the Turkish entity or received from the parent through exchange of information agreements
Annual Transfer Pricing Form
All corporate taxpayers with related-party transactions must file the Annual Transfer Pricing Form together with their corporate tax return. This form discloses the nature and volume of related-party transactions, the website methods used, and whether documentation has been prepared. Late or incomplete filing carries significant penalties.
Penalties for Non-Compliance
Transfer pricing non-compliance in Turkey can result in:
- Income adjustment: The Revenue Administration can re-characterize transactions at arm’s length prices, increasing taxable income
- Tax loss penalty: One-time penalty equal to the underpaid tax
- Default interest: Monthly interest accruing from the original due date
- Deemed dividend distribution: If the transfer pricing adjustment results in a deemed profit distribution to a foreign related party, withholding tax may also apply
Celikel CPA — Transfer Pricing Services
At Celikel CPA, we assist multinational companies with comprehensive transfer pricing services including documentation preparation (Master File, Local File), benchmarking studies and comparability analyses, Annual Transfer Pricing Form filing, and advisory on intercompany transaction structuring.
Need transfer pricing support? Contact us: yigit@celikelcpa.com | WhatsApp: +90 544 649 40 87
