A solid oxide fuel cell-gas turbine (SOFC-GT) hybrid system supplying liquid fuel as ethanol exhibits promise as an auxiliary power unit. In this study, the recirculation of anode and cathode exhaust gas in the SOFC-GT system is proposed to improve the efficiency of heat management in the SOFC-GT hybrid system. The key operating parameters, such as fuel utilization factor and the cell and GT temperatures, are analyzed in terms of the performance of the SOFC-GT hybrid systems. The simulation results show that the recirculation of anode and cathode exhaust gas has a direct impact on the turbine performance. To maintain the inlet temperature of the small turbine in the range of 873–1223 K, the amount of fuel and air added to the combustor to control the turbine inlet temperature on the system performance is also investigated. A SOFC-GT hybrid system with both anode and cathode exhaust gas recirculation achieves the highest system and thermal efficiency.