Calculators
Severance Pay Calculator
Severance pay is calculated as one month's gross wage for each full year of service (Article 14 of Act No. 1475). Enter your start and end dates and gross wage below; the current statutory ceiling and stamp tax are applied automatically.
No income tax or social security contribution is deducted from severance pay; only stamp duty is (Income Tax Act, Art. 25/7). Whether you qualify for severance pay (resignation, termination for just cause, retirement etc.) is not part of this calculation.
Eligibility Requirements for Severance Pay
To qualify for severance pay, an employee must have worked at least one full year for the same employer and the contract must have ended for a reason recognized by law — the employer's termination, the employee's termination for just cause (Article 24), or special circumstances such as marriage, military service, or retirement. Resignation generally does not give rise to a severance right.
Statute of Limitations for Severance Pay
Severance pay claims are subject to a five-year statute of limitations running from the date the employment contract ended (Additional Article 3 of Act No. 4857, introduced by Act No. 7036). If no action or enforcement proceeding is brought within this period, the employer may raise a limitations defense.
Interest Where Severance Pay Is Paid Late
If severance pay is not paid in full and on time, the employer must pay it together with the highest interest rate banks apply to deposits for the period of delay (Article 14/11 of Act No. 1475). This interest starts running from the date the contract ended and can be markedly higher than the general statutory interest rate.
Severance Pay After Reinstatement
An employee who wins a reinstatement action must apply to the employer to resume work within ten working days of the judgment becoming final; if the employer does not reinstate the employee within one month, the contract is deemed terminated on that date. Under the Court of Cassation's settled practice, the period the employee spent out of work is added to their length of service, and severance pay is calculated on this extended period.
How the Severance Pay Ceiling Is Applied
The ceiling caps the calculation for employees whose dressed-up gross wage exceeds it; whatever the employee's actual wage, the amount calculated per full year cannot exceed the ceiling. For the second half of 2026, for example, the ceiling is 73,729.87 TL; an employee earning more than this per month has their severance calculated on the ceiling, not their actual wage.
Payments Included in and Excluded from the Severance Calculation
| Payment | Included? |
|---|---|
| Recurring transport, meal, or provision allowances | Included — added to the gross wage |
| Regular/periodic bonuses | Included — monthly equivalent is calculated |
| Overtime pay | Excluded |
| One-off bonus or award | Excluded |
Key Points in the Severance Pay Process
| Topic | Rule |
|---|---|
| Limitation period | 5 years from the end of the employment contract (Additional Art. 3) |
| Late-payment interest | The highest interest rate banks apply to deposits (Art. 14/11) |
| Deduction | Only a 0.759% stamp tax; no income tax is withheld |
| Ceiling (H2 2026) | 73,729.87 TL — wages above this are capped at the ceiling |
Source Legislation
The links below go to the official, current text of the law on the Turkish Presidency's Legislation Information System.
Last updated: September 11, 2026
Frequently Asked Questions
How many years must one work to qualify for severance pay?
The employee must have worked for the same employer for at least one full year (Article 14 of Act No. 1475). No severance right arises for employment under one year.
What is the severance pay ceiling?
A cap set twice a year (January and July) by the Ministry of Treasury and Finance; if the gross wage exceeds it, the calculation is based on the ceiling.
Can an employee who resigns receive severance pay?
Generally no, unless the resignation is for a just cause under Article 24, or falls under statutory exceptions such as marriage, military service, or retirement.
What deductions apply to severance pay?
Only a stamp tax of 0.759% is deducted; income tax is not withheld from severance pay.
What happens if severance pay is not paid on time?
The employer must pay the highest interest rate banks apply to deposits for the period of delay (Article 14/11 of Act No. 1475).
How is severance pay calculated for an employee who wins a reinstatement action?
The employee must apply to resume work within ten working days of the judgment becoming final; if the employer does not reinstate them within one month, the contract is deemed terminated on that date, and the period spent out of work is added to their length of service for the severance calculation.
How often is the severance pay ceiling updated?
The Ministry of Treasury and Finance updates it every January and July, in line with the increase in the civil servant salary coefficient.
Can part-time employees receive severance pay?
Yes; part-time employees qualify for severance pay on the same one-year and other conditions; the calculation uses the dressed-up gross wage determined by their part-time employment.