Calculation of Reduced Corporate Tax for SPP Investments and Manufacturing and Exporters

Calculation of Reduced Corporate Tax for SPP Investments and Manufacturing and Exporters

For SPP investments made within the scope of the incentive certificate, if they are realized in the 1st, 2nd and 3rd regions, the regional supports applied in the 4th region; if they are realized in the 4th, 5th and 6th regions, the regional supports applied in the region will be utilized.

Investment contribution rate and tax deduction rates by region are given below:

It is beneficial to follow the steps below in the application of reduced corporate tax on SPP investment:

1. First, discounted corporate tax will be applied to earnings from other activities during the investment period.
2. The investment period is short in SPP investments. For this reason, the investment period and operation period should be determined correctly. The investment period is the period between the beginning of the temporary tax period in which the investment is started and the end of the temporary tax period that includes the date of completion of the investment (closing application or actual completion).
3. When applying reduced tax on earnings from other activities, 80% of the total investment contribution amount can be used (taking into account the limitation of the total investment amount). The remaining part will be used when the investment starts to generate income during the operation period.
4. The difference between the direct financial equivalent of the amount of energy provided from the investment and consumed in operation (excluding VAT and various fund fees) and the cost incurred to provide this energy (SPP depreciation, labor costs for its operation, periodic cleaning and maintenance costs can be counted among the costs) is considered as the profit from the investment.
5. In the event that some of the energy produced is sold, the profit from this sale is also considered as profit from the investment. In this case, the sales proceeds will be added to the gain referred to in the previous article.

Example 1:

(A)After the investment is commissioned, the direct financial equivalent of the amount of energy produced and consumed in the enterprise instead of being purchased from outside due to the investment is 3.000.000,00-TL. The cost incurred during the period for the production of energy is 1.200.000,00-TL (depreciation and other expenses). In addition, some of the energy was sold for a fee and a revenue of TL 400.000,00 was obtained from this sale.

The company’s corporate tax base at the end of the 2023 accounting period is 80.000.000,00 TL.

• The dates of commencement and completion of the investment coincide with the third advance tax period. The enterprise is considered to be in the investment period in this period. Discounted corporate tax can be applied to the income from other activities during the investment period. The investment contribution amount that can be utilized during the investment period is calculated as follows: 10.000.000*%30*%80=2.400.000,00-TL

• During the operation period, the remaining investment contribution amount will be used: 10.000.000*%30*%20=600.000,00-TL

• The taxpayer’s discounted tax rate is found as follows: 25-25*70%=7,5% (For ease of understanding, it is assumed that the taxpayer does not benefit from the manufacturer or exporter discount at this stage).

• The tax base that will allow the taxpayer to use the investment contribution amount of 2.400.000,00-TL is: 2.400.000/0,175=13.714.285,71-TL (Since a low tax rate of 25-7,5%=17,5% is paid, the investment contribution amount to be used is divided by 0,175).

Accordingly, the discounted corporate tax calculation table and the tax payable for the third provisional tax period are as follows

Yatırım, üçüncü geçici vergi döneminde tamamlandığından mükellefin kalan yatırıma katkı tutarını (600.000-TL) sonraki dönemde, yatırımdan elde edilen kazanca indirimli vergi uygulamak suretiyle kullanması gerekecektir. Kalan yatırıma katkı tutarının kullanılmasına ilişkin hesaplama aşağıda yer almaktadır:

• Soruya göre  yatırımdan elde edilen kazanç 3.000.000-1.200.000+400.000=2.200.000-TL’dir. Bu tutar indirimli kurumlar vergisine tabi tutulacak matrahtır.

• Bu tutara uygulanacak indirimli vergi oranı ile kullanılacak yatırıma katkı tutarı: 2.200.000*%17,5=385.000-TL olacaktır (genel vergi oranı-indirimli vergi oranı*matrah).

• Kalan yatırıma katkı tutarı ise 600.000-385.000=215.000,00-TL olacaktır.

Buna göre, 2023 hesap dönemindeki indirimli kurumlar vergisi hesaplama tablosu ile ödenecek vergi aşağıda yer almaktadır:

*Amount found by adding 2.200.000,00-TL to the previous period’s reduced tax base.

Since the taxpayer has paid 12.600.000,00 TL tax in the third provisional tax period, it will pay 17.215.000,00-12.600.00,00=4.615.000,00 TL corporate tax in this period.

Although the taxpayer has a high tax base in this period, reduced corporate tax cannot be applied to the income from other activities. The remaining investment contribution amount is used only by applying reduced tax on the income from the investment. Accordingly, the amount of contribution to investment carried forward to the next period is determined as 215.000,00-TL.

Example 2: Same In the third provisional tax period, TL 20.000.000,00 of the company’s earnings arise from manufacturing, TL 30.000.000,00 from exports and TL 10.000.000,00 from earnings other than manufacturing and exports..  YThe application of the reduced corporate tax calculated above without taking into account the manufacturing and export earnings, in case these earnings are taken into account, will be as follows:

As it is known, the 1-point discount applied to manufacturing and export earnings will be applied as 5 points for export earnings starting from the third provisional tax period. Before determining the reduced corporate tax rate according to Article 32/A, the tax rate to be applied to manufacturing and export earnings should be determined. After this rate is determined, 32/A can be applied.

When determining the bases to be used for the investment contribution amount, we consider that the investment contribution amount should be broken down according to the proportion of manufacturing, export and external earnings in the taxpayer’s total earnings. The discounted corporate tax rates that will emerge after applying tax deductions to the rates of 20%, 24% and 25% are different. Therefore, the bases to reach the investment contribution amount should be determined according to these rates. After this determination is made, the bases to be applied discounted corporate tax for each investment contribution amount are found. Then, the tax bases to be taxed at the rates of 20%, 24% and 25% can also be determined.

It is clear that if the earnings are sufficient and the entire investment contribution amount is used, this calculation will not cause a change in the investment contribution amount utilized. However, since the bases that will enable the utilization of this amount will change, the tax base subject to the general rate and the tax to be paid will also change. For this reason, it is important to make the calculation accordingly.

The table below shows the calculation according to the type of income: