Teknopark tax breaks and where the Turkish tech industry sits

Founders working through the numbers on a move to Türkiye usually get to the office question late, and then find something confusing: the export incentive programme pays 50% of an office in London and nothing towards an office in Istanbul.

The two sides of the arrangement are handled by two different regimes, and once you see how they fit together the domestic side is the more generous of the two for anyone employing engineers.

What the export programme does and does not cover

Article 8 of Decision No. 10962 covers rent for units abroad, including shared office memberships, at 50% and up to 70% where the office is in one of the Ministry's target countries. It covers a sales or business development presence in a market you are selling into. Up to 25 such units can be supported.

Your Turkish premises are not in scope, because the programme exists to pay for building export markets rather than for the cost of being in Türkiye. Hosting, advertising, store commissions, software licences and the salaries of marketing and business development staff are all covered. The desk they sit at is not.

Teknoparks are the other half

Türkiye's answer for the domestic side is the Technology Development Zone, set up under Law No. 4691 and known everywhere as a teknopark or teknokent. There are dozens of them, usually attached to a university, and the benefits are aimed squarely at software companies.

Profits from software developed through R&D work carried out in the zone are exempt from corporate tax. Deliveries of that software and the related services are exempt from VAT, under legislation currently running through 2028.

The payroll side is where it becomes material for a studio. Salaries of R&D, design and support personnel working in the zone are exempt from income tax through the end of 2028, for pay up to 40 times the gross minimum wage, which is a ceiling high enough that most engineering salaries sit comfortably underneath it. On top of that, the Treasury covers half the employer's share of social security contributions for those staff, with support personnel counted up to 10% of full-time R&D headcount.

Turkish payroll carries a substantial gap between what an employee receives and what an employer pays, as it does across Europe. These two exemptions close a large part of that gap for exactly the people a studio hires most of.

How the two fit together

The clean way to think about it is that one regime pays for selling abroad and the other pays for building here.

The export programme reimburses the money you spend reaching players and customers in other countries, plus the marketing and business development people who do that work. The teknopark regime reduces the cost of the engineering that makes the product. Between them they cover most of what a software company actually spends money on.

They are administered separately, by different ministries, with separate applications, and for most software companies they are not alternatives. Sorting out how they sit together for a particular mix of income is one of the more common things we get asked to do.

Where the industry clusters

Istanbul is large enough that "based in Istanbul" tells you almost nothing, so it helps to know where things cluster.

On the European side, Maslak and Levent form the corporate spine: towers, headquarters, banks and the larger technology companies, with the metro running straight down it. This is where a company goes when it wants an address that reads as established, and it is priced accordingly.

On the Asian side, Kadıköy has become the district where a lot of the games and startup world lives and works. It is denser, cheaper, full of cafes and coworking space, and it has the informal advantage that a large share of the people you would want to hire already live nearby. Ataşehir sits behind it as the more corporate Asian-side option.

The teknoparks sit slightly apart from both, attached to the universities: İTÜ ARI Teknokent in Maslak and Boğaziçi's zone on the European side, and Bilişim Vadisi in Kocaeli as the largest of the purpose-built zones outside the city. Ankara has ODTÜ Teknokent, Izmir has its own. The pattern across all of them is the same: campus-style buildings, a mix of local startups and multinationals, and rents kept deliberately competitive because the zones are measured on how many companies they attract.

The working day is better placed than people expect

Türkiye sits on UTC+3 all year, with no clock changes, and for a company selling to the world that position matters more than the office address.

A normal Istanbul working day overlaps completely with Europe, which is one or two hours behind. At nine in the morning you can talk to a team in Singapore, where it is early afternoon. At four in the afternoon New York is starting its day. A live-ops team here can hold a call with a publisher in Berlin, a partner in Seoul and a platform contact in San Francisco inside a single day without anyone joining at midnight, which is not true from London and is definitely not true from California.

For a games company that runs events, responds to store issues and watches acquisition campaigns across regions, that overlap is an operational advantage, not just a pleasant detail.

Getting around

Istanbul is split by water, and the split is real. Crossing between the European and Asian sides in rush hour by road can take an hour or more, which is why companies tend to hire on the side they sit on and why people are particular about which side they live on.

The metro network has expanded a great deal and keeps expanding, and the Marmaray line runs under the Bosphorus, so a commute that follows rail rather than road is usually straightforward. The ferries are the option nobody warns you about in a bad way: they are frequent, cheap, and the commute most people who have one refuse to give up.

The practical advice is the same one locals give. Pick your office and your home on the same side of the water, or on the same rail line, and the city is easy.

The practical shape for most studios

A foreign studio setting up here typically ends with something like this: a company registered in Istanbul, engineering in a teknopark unit or a normal office depending on whether the payroll benefit is worth the paperwork, commercial staff wherever the founders want to sit, and a small sales presence abroad once there is a reason for one.

The office is rarely the decision that matters. Payroll and user acquisition are the two lines that dominate a software company's spending, and both are heavily subsidised here: user acquisition through the export programme at 50% or 70% in target countries, and engineering payroll through the teknopark exemptions.

If you want to see the export side against your own numbers first, the calculator does that in a couple of minutes. The teknopark question is one to settle once you know roughly how many engineers you expect to have here.