Turkish Accounting Standards: TFRS, IFRS and VUK

Quick answer

Turkish accounting standards in 2026: when TFRS, BOBİ FRS and VUK tax books apply, how they differ from IFRS, and which audit and e-ledger duties apply.

Foreign companies operating in Turkey need to work within two connected frameworks: Turkish Financial Reporting Standards (TFRS), which are aligned with International Financial Reporting Standards (IFRS), and the VUK tax books used for statutory filings. This guide explains which standards apply in Turkey for 2026, including recent regulatory updates and compliance obligations.

Which accounting framework applies in Turkey?

Turkey operates a multi-tier accounting standards system governed by the Public Oversight, Accounting and Auditing Standards Authority (KGK). The framework includes three main tiers:

📊 TFRS

Türkiye Finansal Raporlama Standartları

The full set of Turkish Financial Reporting Standards, aligned with IFRS. Mandatory for public interest entities including publicly traded companies, banks, insurance companies, and other financial institutions.

📋 BOBİ FRS

Large & Medium Companies

A simplified accrual-based framework designed for large and medium-sized non-public companies that are subject to statutory audit. Provides a middle ground between full TFRS and basic tax accounting.

📒 Uniform Chart of Accounts

Tekdüzen Hesap Planı

The statutory bookkeeping standard mandatory for all companies for tax reporting purposes. Every company in Turkey must maintain its books according to this chart, regardless of size or ownership structure.

TFRS vs IFRS: Key Differences

TFRS is essentially the Turkish translation of IFRS with some local interpretations. The KGK translates and adopts each IFRS standard, issuing it as a corresponding TFRS standard. In substance, a company applying TFRS is also compliant with IFRS. However, there are minor differences in implementation guidance and transition provisions specific to the Turkish market.

2026 IFRS Amendments Coming Into Effect

For 2026, key IFRS amendments coming into effect include changes to IFRS 9 and IFRS 7 regarding classification and measurement of financial instruments, as well as Annual Improvements to IFRS (Volume 11). These amendments will be reflected in the corresponding TFRS updates published by the KGK.

| Aspect | TFRS | IFRS | |---|---|---| | Governing body | KGK (Public Oversight Authority) | IASB (International Accounting Standards Board) | | Language | Turkish (official), English (reference) | English (official) | | Applicability | Public interest entities in Turkey | Globally adopted jurisdictions | | Substance | Aligned with IFRS (Turkish translation) | Original standards | | Local additions | Implementation guidance for Turkish market | None (jurisdiction-neutral) |

Statutory Books and Tax Reporting

All companies in Turkey, regardless of whether they apply TFRS or BOBİ FRS for financial reporting, must maintain their books according to the Uniform Chart of Accounts and the Turkish Tax Procedure Law (VUK). This dual-reporting requirement is important for foreign companies to understand:

VUK-Based Books

Used for tax calculations and reporting to the Revenue Administration. All tax declarations, withholding calculations, and VAT returns are prepared based on VUK-compliant books. This is the primary accounting obligation for every Turkish company.

TFRS / BOBİ FRS Statements

Used for financial reporting, statutory audits, and group consolidation. Companies subject to statutory audit must prepare separate financial statements under TFRS or BOBİ FRS in addition to their VUK-based books.

E-Ledger (e-Defter)

Electronic general ledger mandatory for companies above revenue thresholds. The e-Ledger system requires digital record-keeping through the Revenue Administration’s infrastructure, with monthly submissions signed with electronic certificates.

E-Invoice (e-Fatura)

Electronic invoicing required for most commercial companies. Turkey’s e-Invoice system is one of the most advanced in the world, mandating structured electronic invoices exchanged through registered integrators.

Dual Reporting: Key Takeaway

Foreign companies must understand that maintaining VUK-compliant books is a non-negotiable legal requirement in Turkey, even if their parent company requires IFRS-aligned financial statements. Both sets of records must be maintained simultaneously, and the VUK books serve as the basis for all tax obligations.

SMMM engagement and filing responsibility

Most operating companies use a licensed SMMM for statutory bookkeeping, declarations and electronic filing. The precise signature and filing route depends on the taxpayer, the declaration and the current rules; some taxpayers that are outside the mandatory professional-signature scope can obtain credentials and file directly. It is therefore inaccurate to state that every company is legally unable to file any return without an external SMMM.

Tax Return Preparation: Preparing and signing monthly VAT returns, withholding tax declarations, stamp tax returns, and annual corporate income tax returns
Statutory Book Maintenance: Maintaining the general ledger, journal entries, and subsidiary ledgers in accordance with the Uniform Chart of Accounts
Monthly/Annual Filings: Filing all periodic declarations and notifications with the Revenue Administration and Social Security Institution
Regulatory Compliance: Ensuring compliance with VUK (Tax Procedure Law), KGK (Accounting Standards), and other regulatory requirements

Practical onboarding point

The filing authority, signature requirement and bookkeeping responsibility should be confirmed when the tax registration is activated. Foreign-owned companies normally appoint a local SMMM at the start so the registered tax types, books and filing calendar are configured correctly. For details, visit our bookkeeping services page.

Statutory Audit Requirements

Statutory audit by an independent audit firm is mandatory for companies meeting certain size criteria. Companies subject to audit must apply either TFRS or BOBİ FRS. The KGK determines the audit thresholds, which are reviewed periodically.

2026 Statutory Audit Thresholds

Companies exceeding two of the following three criteria are subject to mandatory statutory audit:

| Criterion | 2026 threshold | |---|---| | Total assets | TRY 500 million+ | | Net revenue | TRY 1 billion+ | | Employees | 150+ |

For the general category, the current decision uses these thresholds for financial periods beginning on or after 1 January 2026 and applies its multi-period test. Listed and specially regulated categories can follow separate schedules or direct inclusion rules, so the KGK decision must be checked before concluding that a company is outside audit. The audit must be conducted by a KGK-authorized independent auditor or audit firm under Turkish Auditing Standards.

Sustainability Reporting (New)

Since January 2024, Turkey has adopted TSRS 1 and TSRS 2, which are translations of IFRS S1 (General Requirements for Sustainability-related Financial Information) and IFRS S2 (Climate-related Disclosures).

TSRS 1 - General Requirements

Based on IFRS S1, this standard requires companies to disclose information about sustainability-related risks and opportunities that could reasonably affect cash flows, access to finance, or cost of capital over the short, medium, and long term.

Based on IFRS S2, this standard focuses specifically on climate-related risks and opportunities. It requires disclosure of governance, strategy, risk management, and metrics related to climate change impacts on the company.

Expanding Scope

While initially applicable to larger public companies, the scope of sustainability reporting is expected to expand in the coming years. Foreign companies with Turkish subsidiaries should proactively prepare for these requirements, particularly if their parent company already reports under IFRS Sustainability Standards or the EU CSRD.

Quick comparison of Turkish accounting frameworks

| Requirement | Applicable to | Standard / framework | Regulator | |---|---|---|---| | Statutory bookkeeping | All companies | VUK + Uniform Chart of Accounts | Revenue Administration (GİB) | | Financial reporting (full) | Public interest entities | TFRS (aligned with IFRS) | KGK | | Financial reporting (simplified) | Audited non-public companies | BOBİ FRS | KGK | | Statutory audit | Companies exceeding thresholds | TDS (aligned with ISA) | KGK | | E-Ledger & e-Invoice | Taxpayers within the current activity, turnover or special-scope rules | GİB e-Defter / e-Fatura | Revenue Administration (GİB) | | SMMM engagement / signature | Depends on taxpayer and filing scope; commonly used by operating companies | 3568 framework and tax communiqués | GİB / TÜRMOB | | Sustainability reporting | Large public companies (expanding) | TSRS 1 & TSRS 2 | KGK |

Official sources

Does Turkey require sustainability reporting?

Turkey has adopted TSRS 1 and TSRS 2 (aligned with IFRS S1 and S2) since January 2024. Currently, these standards apply primarily to larger public interest entities. However, the scope is expected to expand progressively. Foreign companies whose parent companies already report under IFRS Sustainability Standards or EU CSRD should prepare for these requirements in Turkey as well.

What is BOBİ FRS and who uses it?

BOBİ FRS is the simplified financial reporting framework for large and medium non-public companies subject to statutory audit. It sits between full TFRS and basic tax accounting: accrual-based and audit-ready, but with fewer disclosure and measurement demands. Most audited foreign-owned subsidiaries that are not public interest entities choose it.

In which language and currency are the books kept?

Statutory books are kept in Turkish and in Turkish lira. Companies meeting strict conditions can obtain permission for functional currency bookkeeping, but this is exceptional. Group reporting in English or another currency is prepared as an additional layer on top of the VUK books, not instead of them.

Can the parent company’s ERP replace Turkish bookkeeping?

No. Your group ERP can feed data, but the legal records must follow the Uniform Chart of Accounts, be maintained by a licensed SMMM, and flow into the e-Ledger system. The practical setup we run for most clients: local VUK books as the legal base, with a mapped export to the group ERP for consolidation.

Continue Your Turkey Finance Planning

For the operating layer behind statutory and group reporting, compare accounting fees for foreign companies, build a monthly accounting document process and maintain a company-specific Turkey tax filing calendar. Employers can also model 2026 payroll and employer cost before hiring.

Celikel CPA - Your Accounting Partner in Turkey

At Celikel CPA, we provide comprehensive accounting services in Turkey for foreign companies operating in Turkey. Our services cover every aspect of Turkish accounting compliance:

Turkish Statutory Bookkeeping: Full VUK-compliant bookkeeping using the Uniform Chart of Accounts, including general ledger maintenance and journal entry processing
TFRS / IFRS Financial Statements: Preparation of financial statements under TFRS for companies subject to statutory audit or parent company consolidation requirements
E-Invoice & E-Ledger Setup: Complete setup and ongoing management of Turkey’s mandatory electronic invoicing and ledger systems
Monthly & Annual Tax Returns: Preparation, filing, and signing of all periodic tax declarations including VAT, withholding, stamp tax, and corporate income tax
Liaison with Statutory Auditors: Coordination with independent audit firms for companies subject to mandatory statutory audit

Talk to Celikel CPA Explore services

Frequently Asked Questions

Does my Turkish subsidiary need to follow IFRS?

It depends on the company’s classification. If your subsidiary qualifies as a public interest entity or exceeds the statutory audit thresholds, it must apply TFRS (which is aligned with IFRS) or BOBİ FRS. All companies, regardless of size, must maintain VUK-based statutory books for tax purposes. If your parent company requires IFRS-aligned statements for consolidation, your CPA can prepare these alongside the mandatory VUK books.

What is the difference between VUK books and TFRS financial statements?

VUK (Tax Procedure Law) books are maintained according to the Uniform Chart of Accounts and serve as the basis for all tax calculations and filings in Turkey. TFRS financial statements are prepared for financial reporting, statutory audits, and group consolidation purposes. The two can produce different figures for the same period due to differences in recognition, measurement, and classification rules. Most companies maintain VUK books as their primary records and prepare TFRS statements as an additional layer.

Is a local CPA mandatory for all companies in Turkey?

Most operating companies engage a licensed SMMM, and many declarations are filed through the professional-intermediation and signature framework. However, the legal route is taxpayer-specific; certain taxpayers outside the mandatory signature scope can obtain credentials and submit their own electronic declarations. Confirm the applicable route when activating the tax file.

What are the e-Ledger and e-Invoice requirements?

E-Ledger and e-Invoice are separate GİB systems with activity, turnover and special-scope entry rules. A company must check each obligation and transition date under the current communiqué; registration for one electronic document does not mean every other system starts on the same date. Filing periods and technical routes also depend on the applicable rules.

When does my company need a statutory audit?

For the general category and financial periods beginning on or after 1 January 2026, the thresholds are TRY 500 million total assets, TRY 1 billion annual net sales and 150 employees. The decision applies a multi-period test, while listed and specially regulated companies can have separate criteria or direct inclusion. Check the current KGK decision before applying the general table.