28.10.2022/69
Exemption Applicable for the Conversion of Foreign Currencies in the 30.09.2022 Balance Sheets to Currency Protected Deposit Accounts (KKM)
With Law No. 7407 published in the Official Gazette No. 31849 dated 28.05.2022, an amendment was made to the temporary 14th article of the Corporate Tax Law. According to this amendment, companies were allowed to convert foreign currencies in their 31.03.2022 balance sheets to Turkish Lira deposits and participation accounts until the end of 2022 using the conversion rate, and the Turkish Lira assets obtained in this way were exempt from corporate tax, including any gains resulting from year-end valuations, provided that they were held in Turkish Lira deposits and participation accounts for at least three months.
Additionally, the President was authorized to extend this exemption to foreign currencies in the 30.06.2022 and 30.09.2022 balance sheets.
Based on this authority, the exemption for foreign currencies in the 30.09.2022 balance sheets was applied with Presidential Decree No. 6297, published in the Official Gazette No. 31996 on 27.10.2022.
Accordingly, companies that convert the foreign currencies in their 30.09.2022 balance sheets to KKM accounts and keep them in the account for at least 3 months will have the interest, profit shares, and support payments under currency protection exempt from corporate tax.
However, it should be noted that this exemption does not cover foreign exchange gains, meaning that any exchange rate gains obtained during the conversion to KKM accounts will be subject to tax.
You can access the relevant Presidential Decree here.
Best regards,
BİLGENER
