Withholding tax and the muhtasar return: deducting and paying in someone else's tax

Rıza Usta the tailor's first muhtasar

Rıza Usta's tailor shop is under real taxation. The shop belongs to a retired teacher; for the rent they agreed "16,000 lira a month in my hand". Two journeymen work with him. He also has a mali müşavir (accountant).

At the end of the first month his mali müşavir asked: "Did you pay exactly 16,000 for the rent? Then you have another 4,000 lira of withholding tax, by the 26th." The first question that came to Rıza Usta's mind was: "I'm the tenant, why does the landlord's tax concern me?"

The miller's share

In the old days, when a villager took his wheat to the mill, the miller set aside his own share before handing over the flour. The share was taken at the source, before the flour reached the villager's hands.

Withholding tax (stopaj) is like that. The word means deducting at the source. On some payments the state takes its tax before the money reaches the other party's hands. But this time it isn't the miller who sets the share aside; it's you, the one making the payment: when you pay the rent, a fee or a salary, you deduct the tax and pay it in on the other party's behalf.

If you forget to deduct it, the tax does not disappear. The tax office asks you for that tax as the one who made the payment, and late payment interest and a penalty may come on top. That's why withholding tax is not something to skip because "it isn't my tax".

You briefly saw what withholding tax is in the lesson What is tax?. Here we move on to its calculation and its calendar.

Rent: if you rent from a person

If you are under real taxation or you are a company, under Income Tax Law art. 94 you deduct withholding tax from the rent of a workplace you rent from a person. For 2026 the rate is 20% of the gross rent (Council of Ministers Decision No. 2009/14592).

The gross rent is the amount before tax is deducted; the net rent is what reaches the landlord's hands. Because Rıza Usta agreed "16,000 in my hand", 16,000 lira is the net rent. To find the gross, the net amount is divided by 0.80:

Rıza Usta's real monthly outflow for rent is 20,000 lira: 16,000 lira to the landlord and 4,000 lira to the tax office. When signing the contract, pay attention to whether the amount written is gross or net; the difference is 20% every month. Also pay the rent not by hand but through a bank or PTT: for workplace rent this is mandatory whatever the amount (Income Tax General Communiqué Serial No. 328), and paying by hand carries a separate penalty.

If you rent the shop from a company, the situation is different: the company issues you an invoice with VAT, and you do not deduct withholding tax. If the person renting it to you is a business owner themselves, ask your mali müşavir about the situation.

Self-employment: mali müşavir, lawyer, architect

When you make payments to self-employed professionals such as a mali müşavir, a lawyer or an architect, you also deduct withholding tax. For 2026 the rate is 20% of the gross fee. These people issue you a self-employment receipt (serbest meslek makbuzu), most of them electronically today.

The monthly fee Rıza Usta pays his mali müşavir:

The VAT on the receipt becomes deductible VAT if you are a VAT taxpayer. The 1,000 lira of withholding tax you deducted is paid in with the muhtasar. If your mali müşavir works as a company and issues you an invoice, no withholding tax is deducted. You saw how a mali müşavir's fee is set in the lesson Mali müşavir fees and the contract.

Tax deducted from salaries

You also deduct income tax and stamp duty from an employee's salary. These are calculated with the payroll, not with a rate. In 2026 the part equal to the minimum wage is exempt from income tax and stamp duty. That's why these taxes are not deducted from the salary of a journeyman working for the minimum wage; for a journeyman paid above the minimum wage there is a deduction, and the amount can change from month to month during the year. The payroll tells you the amount; the steps of the calculation are in the lesson The first payroll.

Muhtasar: all in one return

All the withholding taxes you deducted during the month, that is, the deductions from rent, self-employment fees and salaries, are declared by the 26th of the following month with the withholding tax and premium service return (muhtasar ve prim hizmet beyannamesi); the tax is also paid by the same date. The last payment day for the SGK premium declared on the same return, however, is the end of the following month. Muhtasar means "summary": the tax deducted from many people is gathered in a single form. Your mali müşavir files the return; you pay the money.

Rıza Usta's October 2026 muhtasar:

The taxes on the October muhtasar are paid on 26 November 2026 at the latest. If you have no employees and the conditions are met, there is also the option of filing this return once every three months. All the days are in the lesson A month's calendar.

If you are under simplified taxation

Income Tax Law art. 94 keeps those whose profit is determined under simplified taxation outside the withholding tax obligation. If you are under simplified taxation, you do not deduct withholding tax on rent and self-employment payments; you pay the rent and the fee in full. If you have employees, the withholding tax and premium service return is still filed and the SGK premium is still paid; ask your mali müşavir whether tax is deducted from salaries.

Rıza Usta's routine

Rıza Usta talked to his landlord and had the contract say "gross 20,000 lira, withholding tax paid in by the tenant". Now every month on rent day he puts the 4,000 lira aside separately. When the 26th comes, the money for the muhtasar is ready.