Establishing a Software or Game Company in Turkey: Tax Advantages and Incentives for Foreign Investors

Turkey has emerged as a prime destination for foreign entrepreneurs, software developers, gaming startups, and technology investors aiming to establish a foothold in Europe, the Middle East, and Central Asia

With its strategic geographical location, relatively low operational costs, highly qualified workforce, and strong government-backed tax incentives, Turkey offers significant advantages for international software and game development companies.

If you are considering establishing a software company in Turkey or opening a game development company in Turkey, understanding the available tax exemptions and Technopark incentives is essential.

Why Establish a Software Company in Turkey?

Turkey’s technology ecosystem has grown rapidly in recent years. Many international entrepreneurs choose Turkey because of:

• Competitive operational and employee costs

• Access to highly skilled software developers and engineers

• Strong banking and financial infrastructure

• Easy company establishment procedures for foreigners

• Strategic access to European, Asian, and Middle Eastern markets

• Government-supported technology incentives and tax exemptions

Particularly for companies exporting software services abroad, Turkey offers highly advantageous tax benefits.

Tax Advantages for Software and Game Companies in Turkey

Turkish legislation offers significant tax exemptions for software companies serving international clients, provided specific conditions are met.

Tax Incentive	Benefit	Condition
VAT Exemption	100% exemption	Service performed in Turkey, client abroad
Corporate Tax Reduction	Significant reduction	Exported software services

To qualify for these incentives:

• The software or digital service must be performed in Turkey

• The client must be located abroad

• The service must be utilized outside Turkey

• The invoice must be issued to a foreign company or foreign individual abroad

• The payment must be received in foreign currency and transferred to Turkey

Companies meeting these conditions may benefit from:

• 100% VAT exemption for qualifying export services

• Significant Corporate Tax or Income Tax advantages for exported software services

These incentives make Turkey highly attractive for international software exporters and digital businesses.

Which Services Are Covered Under the Exemptions?

The incentives generally apply to a wide range of technology and digital services, including:

Software Development Services

• Custom software development• SaaS platform development• Coding and programming services• Software testing and debugging

Game Development Services

• Mobile game development• PC and console game development• Digital gaming applications• Backend gaming infrastructure services

IT and Technology Services

• Data processing and analysis• Cloud and storage services• Artificial intellig

ence and automation services• Engineering and digital design services

Technopark Incentives in Turkey

echnoparks are government-supported zones that foster innovation, software development, and R&D activities, offering unparalleled benefits for technology companies.

Additional Advantages of Technoparks

In addition to standard software export tax incentives, companies operating within Technoparks may also benefit from:

• 100% Corporate Tax exemption on qualifying activities• 100% VAT exemption for software-related services• 100% income tax exemption on salaries of software developers and engineers• Reduced social security (SGK) contributions for employees• Government-supported R&D and innovation environment

These incentives significantly reduce operational costs for startups and international technology companies.

Can Foreigners Establish a Company in Turkey?

Yes. Foreign individuals and foreign companies can establish a company in Turkey with 100% foreign ownership.

The most commonly preferred company type is a Limited Liability Company (Ltd. Şti.), which can generally be established within a few business days once the required documents are prepared.

Foreign investors usually prefer Turkey for:

• Software companies

• Mobile game studios

• AI startups

• IT consultancy companies

• E-commerce infrastructure companies

• SaaS businesses

• Digital marketing agencies

Why International Gaming Companies Choose Turkey

Turkey has become a growing hub for mobile gaming and software development. International gaming companies often choose Turkey because of:

• Young and tech-oriented population

• Affordable developer costs compared to Europe and the US

• Strong local gaming ecosystem

• Tax-efficient operational structure

• Access to multilingual talent

For many startups, Turkey offers the possibility to combine lower operational costs with substantial tax incentives.

Legal and Accounting Support for Company Formation in Turkey

When establishing a software or game company in Turkey, it is important to work with professionals familiar with:

• Company formation procedures

• Tax incentive applications

• Technopark applications

• Accounting compliance

• Employment regulations

• Work permits for foreign employees

• International taxation and invoicing

Proper legal and accounting structuring is essential to maximize available incentives and maintain compliance with Turkish legislation.

Turkey offers substantial opportunities for foreign software companies, gaming startups, and technology investors seeking an internationally competitive and tax-efficient structure.

With VAT exemptions, Technopark incentives, salary tax advantages, and relatively low operational costs, Turkey is increasingly becoming a preferred destination for international technology businesses.

If you are considering opening a software company in Turkey or establishing a game development company in Turkey, obtaining professional legal and tax guidance before the incorporation process is strongly recommended.