Summary

Turkey has a broad based social security system covering retirement benefits, disability and industrial injury, maternity benefits, unemployment and health insurance.

Entitlement to benefits generally derives from and individual’s contribution history, although some benefits in the area of social assistance and social benefits arise due to residence in Turkey.

Details

Contributions

The combined employer contribution rate (including those to the unemployment insurance fund) is 22.5% on annual earnings up to $46,000. Employee contributions are 15% on the same earnings base. Maximum employer contributions are therefore $10,300 per year, and maximum employee contributions $6,900.

Treaties

Turkey has 35 bilateral social security agreements, including most major EEA countries and the UK and Canada. These agreements determine which country has the right the charge social security, has the obligation to provide benefits, and prevent social security being levied twice on the same income. Most inbounds expatriates to Turkey therefore continue to pay home social security rather than Turkish contributions. There is no bilateral agreement with the US, so US employees working in Turkey on assignment are subject to double contributions.

Many of Turkeys agreements are for less than the ‘standard’ five years, although the Turkish authorities are generally accepting of applications for extended home country coverage.

Exemptions

A foreign national who remains covered under the social security system of their home country is not required to pay Turkish contributions for up to three months, provided proof of foreign coverage is filed with the local social security office.

Given the comparatively low level of income cap for social security purposes, exempting certain elements of income from the scope of social security is unlikely to produce cost savings for the few non Turkish employees who are subject to Turkish social security.

Administration

Monthly social security contributions must be paid over by the 26th of the following month. SSI contributions are paid to the tax office via a process called ‘MUHSGK’.

Benefits

Benefits are generally low and are rarely accessed by non-Turkish nationals. Contributions to the Turkish social security system or the regimes of some of the countries with which Turkey has bilateral agreements gives access to Turkey’s Universal Healthcare system.

Other

Individual contributions to Turkish social security is tax deductible.

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