2026 comparison of income tax, corporate tax, and dividend withholding
When deciding whether to set up a sole proprietorship or a limited company, it lets you see your tax burden in advance. Enter your annual profit and it compares the income tax you would pay as a sole proprietor with the corporate tax and personal tax on dividends you would face in a limited company. The result is not fixed; as profit rises, tax brackets apply differently, so which structure is more advantageous can change — sole proprietorships often win at low and mid profits, while limited companies can come ahead at higher profits.
Enter the amounts and limited company options. Results update instantly with every change.
Taxable profit (revenue − expenses)
1,800,000.00 TL
400,000 TL for 2026. Ages 18–29 and first-time taxpayer status for up to 3 tax periods; applies only to sole proprietorships, not Limited/JSC.
Newly established companies are exempt from minimum corporate tax during their first three years of activity.
If yes, 15% withholding is calculated; if the post-exemption amount exceeds the 2026 declaration threshold (400,000 TL), shareholder annual income tax and credit/refund are included.
Business income — actual-basis income tax
Income tax payable
512,500.00 TL
Corporate tax + shareholder annual income tax (withholding credit)
Final total tax burden
594,750.00 TL
Comparison result
Under the selected assumptions, the difference between the lower tax burden and the other option is 82,250.00 TL.
Difference (Sole − Limited)
-82,250.00 TL
2026 non-wage income tax brackets and effective tax rate
Minimum corporate tax and first-three-year exemption for limited companies
50% dividend exemption, 400,000 TL threshold, withholding credit and estimated refund
Annual tax-burden comparison of sole proprietorship vs limited company
Young entrepreneur exemption (ITA art. 20 bis) — sole-proprietorship asymmetry
You can get CPA (SMMM) advice for entity choice, tax planning, and your specific situation.
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