Minimum Wage, Lower and Upper Limits for Insurance Premiums

In accordance with the Minimum Wage Determination Commission Decision published in the Official Gazette dated 30 December 2023; It has been decided to determine a single minimum wage at the national level, and to be applied equally for all employees at the national level between 01.01.2024 and 31.12.2024, the worker’s minimum wage for one day of normal work (666.75) will be six hundred sixty-six lira and seventy-five kuruş. , the monthly gross amount was 20,002.50 TL.

Daily earnings limits are defined in Article 82 of the Social Insurance and General Health Insurance Law No. 5510 and “The lower limit of daily earnings used as the basis for calculating the premiums to be received and allowances to be given in accordance with Law No. 5510 is one-thirtieth of the minimum wage, and the upper limit is 7 times the lower limit of daily earnings.” It is stipulated that it will be 5 times.

According to this; The Insurance Premium base and ceiling amounts to be applied between 01.01.2024 – 31.12.2024 will be as follows:

In accordance with Article 25 of Law No. 3308, the wages to be paid to candidate apprentices, apprentices and students who receive vocational training in enterprises, who continue internship or complementary education, and the increases in these wages; the candidate apprentice or the apprentice’s parent or guardian, or himself if the person is of legal age; For students, it is determined by a contract between the school principal and the business owner, in accordance with the principles determined by the Ministry. However, students receiving vocational training in enterprises and students receiving internship or complementary education in vocational and technical secondary schools and institutions are not allowed to pay more than 30 percent of the net amount of the minimum wage in workplaces employing twenty or more personnel, 15 percent in workplaces employing less than twenty personnel, candidate apprentices and Apprentices cannot be paid less than 30 percent of the minimum wage appropriate to

their age, and 12th grade students of vocational training centers who have gained journeyman qualification cannot be paid less than fifty percent of the minimum wage.

Wages to be paid to candidate apprentices, apprentices and students are exempt from all taxes.

Insurance premiums of candidate apprentices, apprentices, students receiving vocational training in enterprises and students who are subject to internship, complementary education or field training while studying in vocational and technical secondary education schools and institutions are paid at fifty percent of the minimum wage, paid by the Ministry and the universities to which higher education institutions providing vocational and technical education are affiliated. It is covered from the appropriation included in the budget.

The regulations in the “Law on Amendments to the Income Tax Law and Certain Laws” published in the Official Gazette dated December 25, 2021, include articles regarding the exemption of the minimum wage from income tax and stamp duty. Likewise, in these regulations, it has been adopted that income tax and stamp duty will not be collected on income equal to the minimum wage for wage earners who earn income above the minimum wage.

In accordance with the aforementioned regulations, the monthly net amounts of the minimum wage between 01.01.2024 and 31.12.2024 are as follows:

Minimum Wage Deductions and Net AmountEmployer Contribution to Minimum Wage

TLTL

Gross Amount 20,002.50 Employer’s Share of Insurance Premium (20.5%)* 4,100.51

Insurance Premium Workers’ Share (14%) 2.800,35 Unemployment Insurance Employers’ Share (2%)

400.05

Unemployment Sig. Workers’ Share (1%)200.03

Total Deductions3,000.38

Net Amount to be Paid*17,002.12 Total 4,500.56

The cost of a minimum wage earner to the employer is 24,503.06 TL per month throughout 2024. Namely;

Cost of Minimum Wage to Employer TL

Gross Fee 20,002.50

Employer Insurance and Unemployment Premiums 4,500.56

Total Cost(*) 24.503,06

(*) However, employers who regularly submit their monthly premiums and service documents to the Social Security Institution and pay their premiums regularly and have no debts will be able to benefit from a 5-point insurance premium discount (therefore, employer insurance premiums will be reduced to 15.5% instead of 20.5%). and when the said discount is taken into account, the cost of the minimum wage to the employer will be 23,502.94 TL per month.

On the other hand, since the amount corresponding to the minimum wage is excluded from tax, a minimum wage earner will not be able to benefit from discounts such as insurance, personal insurance, union dues, disability discount. However, those who earn wage income exceeding the minimum wage are entitled to disability discount, union dues, etc., if any. Discounts may be made.

Application of Income Tax Exemption for Wages Above the Minimum Wage

The provision of paragraph No. 18, which was added to the first paragraph of Article 23 of the Income Tax Law, regulating Wage Exceptions, by Law No. 7349, is as follows:

“The wages of the service personnel corresponding to the remaining amount after deducting the workers’ social security institution premium and unemployment insurance premium from the monthly gross amount of the minimum wage valid in the month of payment (provided that, in the taxation of wage income exceeding the exemption, the income bracket amounts and rates in which the tax will be calculated are within the scope of the exemption. The amount of tax to be paid is calculated by deducting the part corresponding to the exemption amount from the tax amount found in this way. The tax that will not be collected due to the exception cannot exceed the tax that should be calculated on the monthly minimum wage in the relevant month. For those who receive wages from more than one employer, this exemption is only for the most It is applied to the higher wage.”

With the provision of the said article; The remaining part of the wages paid to service personnel, after deducting the workers’ insurance premium and unemployment insurance premium from the gross minimum wage valid in the relevant month, is exempt from income tax, and it is ensured that income tax is not collected on the part of the wage income corresponding to the minimum wage.

In taxation of wage income above the minimum wage; Taxation will be made according to the tax brackets and rates to which the cumulative tax base is subject, including the amount within the scope of the exemption. In other words, in the taxation of wage income exceeding the exemption amount, it is envisaged that the income tax bracket and rate to be applied will be determined by adding the exemption amounts in the relevant month and previous months, and the tax will be calculated by taking into account the tax brackets and rates to which the cumulative amount determined in this way is subject. In this way, it is ensured that all wage earners benefit from the minimum wage exemption in a way that does not exceed the exemption amount enjoyed by minimum wage earners.

For example; First, the worker’s insurance premium (25,000 15=) 3.187,50 TL income tax will be calculated (According to the Income Tax tariff to be applied in 2024, there is a 15 percent tax on the income tax base up to the first bracket and 20% tax for the amounts in the second income bracket.) Monthly income tax amount corresponding to the minimum wage (2,550.32 TL) will be deducted from the calculated income tax (3,187.50 TL in the first bracket) and the income tax to be paid will be (3,187.50- 2,550.32=) 637.18 TL. The second month’s cumulative gross wage will be (25,000+25,000=) 50,000 TL, and when 7,500 TL, which is the insurance and unemployment insurance premium amount of the worker for the previous and current month, is deducted from this amount (3,750 + 3,750=), the cumulative tax base amount will be 42,500 TL. . In other words; The cumulative amount to be found by adding the first month’s tax base of 21,250 TL and the second month’s tax base of 21,250 TL will be 42,500 TL. Cumulative amounts calculated in this way will be taken into account when determining the tax rate according to the brackets in the Income Tax Tariff. The amount on which income tax will be calculated in the second month will be (21,250 It will be found in TL. The calculation will continue in this way in the following months. (According to the income tax tariff determined for 2024, if the total amount of the minimum wage tax calculation in the following months exceeds the first income bracket subject to a 15% rate; the excess part will fall into the 20% income bracket. While the income tax corresponding to the monthly minimum wage is calculated on the exceeding portion The tax amount calculated by taking this rate into consideration should be deducted. When the calculation is made in accordance with the income tax tariff to be applied to wages in 2024, it is calculated as 2,550.32 TL per month in January-June, 3,001.06 TL in July, and 3,400.43 TL in August-December. The income tax to be paid will be calculated by deducting it from the income tax.) Thus, all wage earners will benefit from the same amount of tax exemption as the minimum wage earner.

Application of Stamp Duty Exemption for Wages Above the Minimum Wage

The article that aims to ensure that stamp duty is not collected on the part of the wages paid to service personnel corresponding to the monthly gross minimum wage is as follows:

Coming after the phrase “papers related to wages” in paragraph (34) of the section titled “IV- Papers related to commercial and civil affairs” of the table numbered (2) annexed to the Stamp Tax Law No. 488 dated 1/7/1964 (This article Exception for the wages regulated in paragraph 18 of the first paragraph, within the portion corresponding to the monthly gross minimum wage.