Evaluating the taxation of compensation

The recently adopted exemption of compensations and aids under Income Tax Law Article 25 from taxation constitutes great significance in Turkish Tax system. The method by which the compensations provided numerus clausus under the law are taxed, the matters to be taken into account when exercising taxation and the determination of beneficiaries should be assessed in particular. Herein this thesis, the cases of tax-exemptions which include the exemptions under Article 25 of Income Tax Law shall be approached in general. In the recent years, the subject of taxation of compensations rose considerably in importance. Thus, we shall examine the way in which taxation is exercised, the legislations from which taxation is derived, and the importance of tax-exemptions. Regarding these topics, we shall further evaluate our analyses with tax rulings issued by Turkish Revenue Administration.