Turkish Uniform Chart of Accounts: Core Accounts, Debit-Credit Logic and Journal Entries

Turkey’s Uniform Chart of Accounts (Tek Düzen Hesap Planı, TDHP) links every transaction to a three-digit account code and fixes which side of the ledger increases that account. It was introduced by General Communiqué No. 1 on the Accounting System (Official Gazette No. 21447 bis, 26 December 1992) and has applied since 1 January 1994. Turkish tax law requires businesses to keep their books on this chart, so any company with a Turkish entity, from an e-commerce seller to a foreign-owned subsidiary, ends up using these codes.

Debit and Credit: One Rule

Debit is the left side and credit the right, and the side that increases an account depends on its nature. Asset accounts (Cash 100, Trade Receivables 120, Merchandise 153) and expense accounts increase with debits. Liabilities (Trade Payables 320), equity (Capital 500) and income (Domestic Sales 600) increase with credits. Contra accounts work in the opposite direction of the group they adjust: Accumulated Depreciation (257) sits among assets but increases with credits.

Core Accounts at a Glance

The nature and debit-credit details below follow the account descriptions in the Communiqué.

Code	Account	Nature	Debit	Credit
100	Cash	Current asset	Increases (receipts)	Decreases; never a credit balance
102	Banks	Current asset	Increases	Decreases
120	Trade Receivables	Current asset	Increases (sale)	Decreases (collection)
153	Merchandise	Current asset	Increases (purchase)	Decreases (sale, withdrawal)
191	Deductible VAT	Current asset	Increases (input VAT)	Decreases (deduction, carry-over)
255	Fixtures and Furniture	Fixed asset	Increases	Decreases
257	Accumulated Depreciation (-)	Fixed asset (contra)	Decreases (disposal)	Increases (depreciation charged)
320	Trade Payables	Short-term liability	Decreases (payment)	Increases (debt incurred)
331	Payables to Shareholders	Short-term liability	Decreases	Increases
360	Taxes and Funds Payable	Short-term liability	Decreases (payment)	Increases (accrual)
391	Calculated (Output) VAT	Short-term liability	Decreases (correction)	Increases (VAT on sales)
500	Capital	Equity	Decreases	Increases
549	Special Funds	Equity	Decreases (offset)	Increases (set aside from profit)
590	Net Profit for the Period	Equity	Decreases	Increases
591	Net Loss for the Period (-)	Equity (contra)	Increases	Decreases
600	Domestic Sales	Income	Decreases	Increases
601	Export Sales	Income	Decreases	Increases
621	Cost of Merchandise Sold (-)	Expense (cost)	Increases	Decreases
642	Interest Income	Income	Decreases	Increases
645	Gains on Sale of Securities	Income	Decreases	Increases
649	Other Ordinary Income and Gains	Income	Decreases	Increases
679	Other Extraordinary Income and Gains	Income	Decreases	Increases
689	Other Extraordinary Expenses and Losses (-)	Expense	Increases	Decreases
690	Profit or Loss for the Period	Closing account	Expense transfer	Income transfer
692	Net Profit or Loss for the Period	Closing account	Net loss	Net profit
740	Service Production Cost	Cost (option 7/A)	Increases	Cleared by year-end allocation
770	General Administrative Expenses	Cost (option 7/A)	Increases	Cleared by year-end allocation

Accounts That Are Often Mixed Up

Account 645 is Gains on Sale of Securities. When securities are sold, a favorable difference between the sale price and cost is credited to it, so it is an income account and does not increase with debits. The unfavorable difference is booked to 655, Losses on Sale of Securities, which increases with debits.

Account 649 is Other Ordinary Income and Gains. “Extraordinary” is reserved for 679 (income) and 689 (expense), meaning items not expected to occur regularly.

Account 549 increases with credits, because amounts set aside from profit are credited to it.

590 and 690/692 are not the same. Income statement accounts are transferred to 690 at year-end, and its balance is the result before tax. The tax provision goes to 691, and the two are closed into 692, the result after tax. At year-end, 692 is transferred to 590 (or 591 for a loss).

Options 7/A and 7/B: Why 740 and 770 Appear Together

740 and 770 are 7/A accounts, which track expenses by function (production, administration, marketing). Under the Communiqué, 7/A is mandatory for production and service businesses above defined size thresholds. Trading businesses, and production or service businesses below the thresholds, may apply 7/B if they wish. Under 7/B, expenses are tracked by type in the 79 series (for example 792 Salaries and Wages of Staff, 794 Miscellaneous Expenses) and distributed to functions at period-end. Check the current thresholds in the amendments to the Communiqué; one business does not use both options together.

740 collects the production costs of the services a service business sells, while 770 collects general administrative costs such as management, office, accounting, personnel and legal functions, both as debits.

Sample Journal Entries

The amounts below are illustrative and use a 20% VAT rate.

Event	Debit	Credit
Credit sale of goods, TRY 1,000 + TRY 200 VAT	120 Trade Receivables 1,200	600 Domestic Sales 1,000; 391 Output VAT 200
Cost of the same sale, TRY 600	621 Cost of Merchandise Sold 600	153 Merchandise 600
Credit purchase of goods, TRY 5,000 + TRY 1,000 VAT	153 Merchandise 5,000; 191 Deductible VAT 1,000	320 Trade Payables 6,000
Service expense, TRY 10,000 + TRY 2,000 VAT, paid by bank transfer (option 7/A)	770 General Administrative Expenses 10,000; 191 Deductible VAT 2,000	102 Banks 12,000
VAT for the period: 391 balance TRY 6,000, 191 balance TRY 4,000	391 Output VAT 6,000	191 Deductible VAT 4,000; 360 Taxes and Funds Payable 2,000
Depreciation, TRY 1,000	Related expense account 1,000	257 Accumulated Depreciation 1,000
Year-end: income TRY 100,000, expenses TRY 80,000	600 Domestic Sales 100,000	690 Profit or Loss for the Period 100,000
Transfer of expenses (under 7/A, 770 is first cleared through its allocation accounts)	690 Profit or Loss for the Period 80,000	Expense accounts 80,000
Tax provision, TRY 5,000	691 Provision for Tax and Other Legal Liabilities on Period Profit 5,000	370 Provision for Tax and Other Legal Liabilities on Period Profit 5,000
690 (TRY 20,000) and 691 (TRY 5,000) are closed	690 Profit or Loss for the Period 20,000	691 5,000; 692 Net Profit or Loss for the Period 15,000
692 balance is transferred to 590	692 Net Profit or Loss for the Period 15,000	590 Net Profit for the Period 15,000

In the service expense example, 770 and 191 are debited and 102 credited. If the expense were on credit, 320 Trade Payables would take the credit side, because 320 covers payables from purchases of goods and also of services related to the business’s activity.

Four Checks That Prevent Posting Errors

Mistakes usually come from posting an amount to the wrong account, not from the wrong side. Check these every period-end:

• VAT never enters the sales account. The Communiqué excludes VAT from gross sales; VAT on the sales invoice goes to 391 and the VAT-exclusive amount to 600 or 601.
• Cash never goes negative. Account 100 never carries a credit balance. A negative cash balance means a receipt or payment is missing or misdated.
• Goods out and cost are booked together. Every merchandise sale credited to 600 needs a credit to 153 and a debit to 621; otherwise profit is overstated.
• Shareholder debts go to 331. Amounts owed to shareholders from non-core transactions belong in 331, not 320.

How VAT Accounts Close at Period-End

On the VAT return, the 391 balance is compared with 191 (and 190, Carried-Over VAT, if any). If 391 is higher, the difference is credited to 360 and paid on the due date. If 191 is higher, the difference moves to 190 and is deducted in a later period. For VAT that cannot be deducted and becomes an expense, see our article on deductible business expenses.

Frequently Asked Questions

Are 590 and 690 the same account?

No. 590 (Net Profit for the Period) is an equity account on the balance sheet, while 690 is the closing account where income statement accounts are collected at year-end. The pre-tax result in 690 moves to 692, and the net result in 692 moves to 590 (or 591 for a loss).

Should a service business use 740 or 770?

Both are 7/A accounts. Production costs of the services sold go to 740 and administrative costs to 770. A business applying 7/B uses the 79-series expense-by-type accounts instead.

Why is Accumulated Depreciation (257) credited?

It is a contra asset account that reduces the carrying value of a fixed asset. Depreciation charged is credited to 257 against the related expense account; if the asset is sold, 257 is debited and the asset account credited.

Can I set my own account codes?

The three-digit main account codes and names are fixed by the chart. You can open sub-accounts to fit your business, but you cannot use a main account against its defined nature and function.

Adapting the Chart of Accounts to Your Business

We set up your chart of accounts around your activity, decide with you between option 7/A and 7/B, and handle monthly postings and year-end closing. Our bookkeeping service covers the daily record-keeping, and our financial reporting service covers reading the balance sheet and income statement. If you work as a freelance professional, our accounting guide for self-employed professionals is also worth a look.