Payroll employer cost calculator

Order of calculation

A month’s payroll is calculated in this order:

1. Social security base: If gross pay exceeds the upper limit of earnings subject to premiums, the limit is used. Under Article 82 of Law 5510 the daily upper limit is 9 times the lower limit.
2. Employee contributions: The employee’s social security and unemployment insurance shares on that base.
3. Income tax base: Gross pay less the employee’s social security and unemployment shares.
4. Income tax: Tax calculated with the progressive tariff on the cumulative base since the start of the year, less the minimum wage exemption.
5. Stamp duty: On gross pay, less the exemption corresponding to the minimum wage.
6. Net pay: Gross less employee contributions, income tax and stamp duty.
7. Employer contributions: The employer’s social security and unemployment shares on the base, less premium support if the conditions are met.
8. Total employer cost: Gross pay plus employer contributions.

Social security rates (Law 5510, Article 81)

Law 7566 set the disability, old-age and survivors’ rate at 21% (employee 9%, employer 12%) from 1 January 2026. In addition, unemployment insurance under Law 4447 is calculated on the same base as an employee and an employer share.

Premium support (Law 5510, Article 81(ı))

For private-sector employers, a set number of points of the employer’s disability, old-age and survivors’ premium is covered by the Treasury. Under Law 7566 this support is two points from 1 January 2026. It is conditional:

• Monthly premium and service documents and the combined withholding and premium returns are filed on time,
• The employee share and the part of the employer share not covered by the Treasury are paid on time,
• There is no premium, administrative fine, late penalty or late interest debt to the Social Security Institution (this condition is treated as met while an installment or restructuring plan continues).

For employers operating in manufacturing, under the same conditions, provisional Article 108 of Law 5510 applies this support as five points until 31.12.2026; the President may extend it until 31.12.2027. For a 50,000 TL gross salary, the employer SGK rate drops to 16.75% and the total employer cost is 59,375 TL.

If you do not qualify, leave the incentive option unticked.

Income tax brackets (Income Tax Law Article 103, wage income)

The brackets apply to the cumulative annual base, so someone on the same gross salary can take home less later in the year. Entering earlier months’ cumulative base in the calculator gets the bracket change right.

Minimum wage exemption and stamp duty

Under Article 23(18) of the Income Tax Law, the wage corresponding to the gross minimum wage less the employee’s social security and unemployment contributions is exempt from income tax. In practice, the tax that would be calculated on the minimum wage is deducted from each employee’s calculated income tax. Someone on the minimum wage therefore pays no income tax; on higher salaries the exemption covers part of the tax.

The fixed exemption amount in the calculator (4,211.33 TL a month) applies from January to June. In July the minimum wage’s own cumulative base passes 190,000 TL and the exemption amount changes.

Stamp duty is calculated on gross pay; the calculator deducts the part corresponding to the minimum wage as exempt.

Period label

The calculator’s parameters are for 2026 H1 (the first half of 2026). The minimum wage, earnings limits, exemption amounts and rates change periodically, and the parameters are updated for each new period.

In the HR module payroll is calculated in these steps, exported as PDF and Excel, and approving it creates the accounting accrual automatically. For where it fits in the monthly close, see the month-end close guide.