Known as AGI, the minimum living allowance (asgari geçim indirimi) is a government-supported benefit paid by the employer on behalf of the state and applied as a reduction from income tax. It provides financial support to employees by reflecting a tax allowance in their pay. When eligibility conditions change, higher amounts may be granted.
How Are AGI Amounts Determined?
The minimum living allowance is applied by the employer as a deduction from income tax and paid to employees as a form of state support. AGI amounts are included when calculating salaries and reflected in payroll. If an employee is married or has children, the calculation takes those family circumstances into account. There are core rules that determine AGI amounts. One key rule covers children who live with or are supported by the employee: this includes biological children, stepchildren, adopted children, grandchildren whose parents are deceased, and children over 18 who are still in education up to the age of 25. Employees can receive AGI for these dependents.
If a child who has lost both parents lives with a grandparent, the grandparent may still be eligible for AGI. For children older than 18 to qualify, they must continue their education and be under 25, so support may also be provided for university students. The crucial point is that a child who attends university after age 18 remains eligible for AGI only if they are not older than 25. Otherwise the child is not counted for AGI. There are no restrictions on the type of education; distance learning and open university programs are included in the eligibility criteria.
No Distinction Between Biological and Stepchildren
AGI rules do not differentiate between biological and stepchildren, so stepchildren and adopted children are treated the same as biological children for allowance purposes. The child’s gender has no effect: both sons and daughters are equally eligible. However, children must be unmarried; if a child marries after turning 18, the allowance for that child becomes invalid. Similarly, once a child starts working in a registered job, the parent can no longer claim AGI for that child. If a child becomes insured through employment, the parent loses the AGI entitlement for that dependent.
The discount rates for children are calculated individually based on the gross annual minimum wage. For the first two children, the allowance is 7.5% of the annual gross minimum wage per child; for the third child it is 10%; and for each additional child it is 5%. A maximum of five children is used in the calculation, so AGI increases with the number of children up to that limit. Because the total amount received by an employee for themselves, a spouse, and children cannot exceed 15% of the gross minimum wage, the system caps the number of children at five; AGI is not applicable for families with more than five children.
Different Rules for Alimony Situations
When parents are divorced and both are employed, the spouse who receives alimony may claim AGI. Priority is determined by who has legal custody, and the allowance is assessed accordingly. Compliance with alimony arrangements is important: if the father is the one paying alimony, he may be able to claim AGI for dependents; if alimony is not paid to the mother, she may be eligible to claim AGI. For children born out of an unregistered relationship, AGI is claimed by the parent listed on the child’s official identity record. If the child lives with and is cared for by the mother, the mother can claim the allowance.