Withholding Tax and Calculation Method
Withholding tax and its calculation is based on the gross wage and is subject to rates that are updated each year. The type of withholding tax is also taken into consideration when determining the method used to calculate withholding tax. The deduction rates applied in wage and rent withholding are different from each other. For this reason, the deduction to be made is also shaped depending on the rate. The deduction rate to be applied in rent withholding is 20%. Accordingly, withholding deduction can be reached by calculating 20% of the gross rent amount. For example, in a situation where the gross rental value is 2000 TL, 400 TL, which is 20% of the price, is paid to the tax administration as withholding deduction, while the remaining 1600 TL from the deduction remains to the owner of the property as net rent.
In wage withholding, the collection process is carried out on the amount remaining after the SSI deduction is applied on the gross price. At this point, the rates determined depending on the tax tariff determined every year are applied on income brackets. In the 2022 tax tariff, 15% tax deduction is applied for the income bracket up to 32,000 TL and 40% for incomes above 880,000 TL.
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