The Türkiye and Japan tax treaty: what leaving profit costs
A Japanese parent holding at least a quarter of a Turkish subsidiary pays 10% on dividends, and 15% below that. Both sides withhold 15% domestically, so this is one of the more balanced treaties in the network.
Türkiye refunds half of what a software company or game studio spends on advertising, app store commissions and hosting when it sells to customers abroad, and up to 70% when those customers are in one of twenty target markets. It is paid in cash, against invoices you have already settled. Try it with your own numbers.
01How much is the shareholding threshold worth in Japan?
A parent in Japan that clears the shareholding test pays 10% on dividends leaving Türkiye, and one that misses it pays 15%. On $500,000 that is $25,000 decided by the share register. The 25% holding is settled when the Turkish company is formed.
- Dividend leaving Türkiye$500,000
- Withheld with the 25% holding, at 10%$50,000
- Withheld below it, at 15%$75,000
- What the holding is worth$25,000
02What does Türkiye withhold on payments to Japan?
| Payment leaving Türkiye | What you actually pay | Türkiye's rate with no treaty | The ceiling this treaty sets | Conditions |
|---|---|---|---|---|
| Dividends | treaty helps10% | 15% | 10% to 15% | 10% where the parent holds at least 25%, otherwise 15%source |
| Interest | 10% | 10% | 10% to 15% | The treaty allows Türkiye up to 10% to 15% here, which is above the 10% it charges anyway, so this line is unchanged by the treaty.source |
| Royalties | treaty helps10% | 20% | 10% | Türkiye's domestic royalty rate is 20%source |
03How does the Japan treaty compare with Türkiye's others?
Japan shares its 10% dividend rate with Poland, Singapore and the United Arab Emirates. 6 of the treaties here go lower, down to 5% for Austria.
- 5%6
- 10%4
- 15%10
Japan sits in the middle of Türkiye's range at 10% to 15%. It is better than the 15% to 20% the United Kingdom, Sweden and Korea face, and short of the 5% Germany, Austria and Switzerland reach. Its 10% qualifying rate matches Poland, Singapore and the Emirates.
04What happens to the money once it lands in Japan?
| In Japan | Rate |
|---|---|
| Corporate tax on ordinary profit | 23.2%source |
| Withholding tax on dividends to a foreign parent | 15%source |
Türkiye against Japan, measure by measure.
05What catches out groups based in Japan?
- The 25% threshold applies, so a minority Japanese holding pays the higher rate.
- Interest is a range rather than a single figure, so the terms of the loan decide the rate.
- Six hours separate Tokyo from Istanbul, which makes the operational side harder than the tax side.
06How does this sit alongside what Türkiye pays Japan groups back?
A Japanese publisher can run global marketing through a Turkish company and take 50 to 70% of it back in cash. The treaty only decides what a later distribution costs, and the two are settled in different filings and usually in different years.
| What you spend it on | Programme item | Paid back | Annual cap |
|---|---|---|---|
| Ads and player acquisition | Digital product promotion: ads & marketing (up to 10 products/yr) | 50% to 70% | 50 000 000 ₺ ≈ $1,043,841 |
| App store and platform commissions | App store & platform commissions (up to 10 products/yr) | 50% | 20 000 000 ₺ ≈ $417,537 |
| Hosting and servers | Hosting costs | 50% | 5 000 000 ₺ ≈ $104,384 |
What Türkiye would pay back on your spending
Türkiye runs a government programme that refunds part of what a software company or game studio spends on reaching customers abroad. It covers advertising, app store and platform commissions, and hosting. The refund is paid in cash against invoices the company has already settled, so it does not depend on the company making a profit. The standard rate is 50%, and it rises to 70% when the customers being targeted are in one of the twenty countries on the Turkish Ministry of Trade's target list.
Put your own yearly figures in below. The rates and the annual caps come from the same file as our full calculator, and the total updates as you type.
07Questions we get asked
Is 10% good by Türkiye's standards?
It is comfortably better than average. Only a handful of treaties reach 5%, and many sit at 15% or 20%.
Does Japan tax the dividend again?
Japan applies its own rules to received foreign dividends, with relief mechanisms that depend on the holding, so the Turkish rate is one half of the calculation.
Who is telling you this
CyberScope Solutions is an Istanbul consultancy that manages Türkiye's IT export incentive claims for software companies and game studios. Treaty rates decide what a group pays to move profit, and they come up in almost every first conversation, so we keep them written down rather than looked up each time.
- Every figure is sourced. Each number links to the page it came from and carries the date we last checked it.
- You find out early if it is not for you. The first call is thirty minutes and we will say plainly if your spend pattern does not suit the programme.
- These pages get rebuilt, not left. Rates and caps come from the same file as our calculator, so when one changes the page changes with it.
Turn that number into money
Send us the rough shape of your spend. You get back what it is worth, what setting it up involves, and how fast the first claim can go in. Companies already operating here treat this as routine, and the six month window means the clock is running on invoices you have already paid.
- A reply from a person within one working day
- No mailing list, no drip sequence
- Thirty minutes, and you keep the numbers either way
Got it.
We will read it properly and reply within a working day. If you would rather get it over with now, pick a time that suits you.
Book a 30 minute call08Where these numbers come from
- https://taxsummaries.pwc.com/turkey/corporate/withholding-taxes checked 2026-08-21
- https://taxsummaries.pwc.com/quick-charts/corporate-income-tax-cit-rates checked 2026-08-20
- https://taxsummaries.pwc.com/quick-charts/withholding-tax-wht-rates checked 2026-08-20