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The Young Entrepreneur Support, provided by the state to encourage young people to step into business life and offer them financial assistance, helps many young entrepreneurs turn their dreams into reality.
This support aims to reduce the financial difficulties that young entrepreneurs may face and provides them with a significant advantage in growing their businesses. So, who can benefit from this support and how can one apply?
In this guide, we will cover in detail the definition of Young Entrepreneur Support, the types of support offered, application requirements and process, incentive amounts, and relevant laws. We will also answer the question of whether KOSGEB support and Young Entrepreneur Support can be received at the same time. Well then, let's get started!
What is Young Entrepreneur Support?
Young Entrepreneur Support is a government assistance program. This program aims to enable young business people aged 18-29 to realize their new business ideas.
The assistance is designed to reduce the financial difficulties of young business people during the establishment and expansion stages of their businesses.
What are the Young Entrepreneur Supports?
Young Entrepreneur Support is created to help young business owners between the ages of 18 and 29 in establishing and maintaining their businesses. The benefits provided by this program include:
• Income tax exemption: In 2023, the earnings of young entrepreneurs up to 150,000 TRY were exempted from income tax. This exemption limit is redefined every year and remains valid for 3 years.
• BAĞ-KUR premium support: For young entrepreneurs, 1 year of BAĞ-KUR premiums is paid by the state. The lowest monthly BAĞ-KUR premium amount determined in 2023 is 3,452.76 TRY. Consequently, a total amount of 41,433.12 TRY in assistance is provided to young business owners for one year.
What are the Requirements for Young Entrepreneur Support?
To benefit from the Young Entrepreneur Support advantage, the following conditions must be met:
• An age limit has been set for those who can benefit from the Young Entrepreneur Support Program. This limit covers those who have reached the age of 18 but have not yet completed the age of 29.
• Pursuant to the duplicated Article 20 of the Income Tax Law, those whose earnings fall within the scope of young entrepreneur exemption can also receive this support.
• Those who have been insured under BAĞ-KUR for the first time since 01.06.2018 also have the right to benefit from the young entrepreneur support.
• Those whose tax registration is opened for the first time due to commercial or professional activity can also receive this support.
• Finally, those who have established an ordinary partnership or a sole proprietorship are also included in the scope of young entrepreneur support.
Who Cannot Benefit from Young Entrepreneur Support?
Not all young entrepreneurs have the right to benefit from this incentive. First of all, entrepreneurs who entered business life before 01.06.2018 cannot receive this support.
In addition, individuals who are partners with another company or who were previously taxpayers and closed their business do not have the right to benefit from this incentive either. Finally, it is not possible for people who establish joint-stock or limited liability companies to receive young entrepreneur support.
How Much is the Incentive Amount in Young Entrepreneur Support?
The legal amendment announced in the Official Gazette decisions on March 12, 2023, has provided a comprehensive tax exemption for taxpayers doing business by receiving young entrepreneur support.
With this change, young entrepreneurs have gained the right not to pay tax on their earnings within the 150,000 TRY limit, which was determined according to the 2nd bracket of the income tax tariff for the year 2023. This tax exemption will be updated every year and applied to remain valid for 3 years.
How Much is the BAĞ-KUR Premium in Young Entrepreneur Support?
Within the framework of supports aimed at young entrepreneurs, BAĞ-KUR premiums are covered by the state in the relevant year following the start of the support period. For the year 2023, the lowest monthly BAĞ-KUR premium amount is set at 3,452.76 TRY. This means that for individuals benefiting from the young entrepreneur support, premium payments totaling 41,433.12 TRY over the course of one year are covered by the state.
What are the Laws Registry to Young Entrepreneur Support?
Regulations regarding the tax and premium exemptions of young entrepreneurs are determined by specific laws and general communiqués. These laws are as follows:
• General Communiqué No. 193 on Income Tax states that young entrepreneurs can be tax-exempt up to a certain income amount.
• Law No. 6663 contains regulations on income exemption for young entrepreneurs. According to this law, young entrepreneurs are exempted from income tax up to a certain amount of income.
• Law No. 5510 on Social Insurance and General Health Insurance contains provisions related to BAĞ-KUR premium exemption. According to the provisions of this law, young entrepreneurs are exempted from the obligation of paying BAĞ-KUR premiums for a certain period of time.
While the specified legal regulations determine the form of application of the young entrepreneur support, they also explain how young entrepreneurs will benefit from this support. It is recommended that individuals planning to become young entrepreneurs carefully review these regulations.
However, it should be noted that these laws are general provisions and do not contain specific sections regarding young entrepreneur support. Detailed information about young entrepreneur support can be found in the implementation regulations and general communiqués of these laws. You can also obtain detailed information with the help of your financial advisor.
How to Apply for Young Entrepreneur Support?
To apply for the Young Entrepreneur Support, a petition must be submitted through the Interactive Tax Office. During this application process, young entrepreneurs who meet the requirements can obtain support from their financial advisors.
You can start benefiting from the support by taking the document submitted to the tax office by your financial advisor, which contains the approval "Can receive young entrepreneur support," to the BAĞ-KUR Insured Registration Service of the Social Security Institution Directorate nearest to your residential address. If you have accumulated BAĞ-KUR premium debts, you can also have your debts canceled during this process.
During the application phase, it is important to pay attention to the business commencement date. The business commencement date specified in your application is accepted as the date of establishment of the company, and your support request is approved based on this date.
If informal income earned before the date of establishment of the company is detected, because the young entrepreneur support has been received unjustly, penal sanctions will be applied and the repayment of the supports provided will be requested.
Is It Possible to Benefit from KOSGEB Support and Young Entrepreneur Support at the Same Time?
It is possible to benefit from Young Entrepreneur Support and KOSGEB assistances at the same time. Young Entrepreneur Support offers comprehensive opportunities for individuals planning to implement their business concepts. KOSGEB, on the other hand, provides financial assistance packages directed towards newly established enterprises.
By receiving these two assistances simultaneously, you can reduce the financial burden created by tax and insurance premium payments, and also take advantage of other benefits offered for new businesses.
Unlike the Young Entrepreneur Support opportunity, the packages offered by KOSGEB contain features that support the establishment and performance of your business. Thus, you can handle the establishment and operating processes in a much easier way.
Young Entrepreneur Support is an important tool that encourages innovative and visionary young entrepreneurs to enter commercial life. The right to receive this support, provided by KOSGEB and other institutions, can be obtained by young entrepreneurs who meet certain criteria.
Such supports offer great opportunities for young entrepreneurs who want to realize their business ideas and create a positive impact on the entrepreneurship ecosystem.
