Taxes in Turkey for Foreigners: Complete 2026 Tax Guide

Thinking of living, working, or investing in Turkey? Understanding taxes in Turkey for foreigners is crucial to avoiding costly mistakes and optimizing your finances. Whether you’re earning income locally or abroad, Turkey’s tax obligations depend on your residency status, income type, and property holdings.

On 4 June 2026, Turkey reformed its income tax framework (Law No. 7582), granting a new income tax exemption for certain foreign-sourced income for 20 years. The exemption applies only to foreign nationals who became Turkish tax residents on or after 1 January 2026 and were not resident in Turkey or subject to full tax liability there during the three years prior.

While Turkey’s tax rates are often lower than those in Western Europe, the system can be intricate, especially for expats and foreign investors. This guide breaks down everything you need to know about Turkey’s income tax, property tax, corporate tax, and new tax exemption, helping you stay compliant and financially confident.

Turkish Taxes: Key Details

The Turkish tax authority is the Turkish Revenue Administration, which is responsible for imposing and collecting state taxes.

While Turkish tax residents are generally liable to pay tax on worldwide income, non-residents are generally only liable to pay tax on Turkish-source income.

Turkey taxes income progressively, with rates starting from 15% to 40%.

Under Law No. 7582, a new 20-year income tax exemption may exclude certain income earned outside Turkey by foreign nationals. The provision is for obtaining tax-resident status as of 1 January 2026 and requires that the individual was not subject to full tax liability in Turkey during the three years prior to that date.

Corporate tax in Turkey is generally 25%; higher rates apply for some financial institutions.

The standard rate of VAT is 20%. Reduced rates of 10% and 1% apply to qualifying goods and services.

Tax on capital gains depends on the classification of the asset, the holding period, and the taxpayer’s residence or non-residence.

Turkey has numerous double taxation treaties that can help prevent income from being taxed twice.

Turkey operates free zones across the country, which are designated areas operating special rules to encourage trade and investment.

Turkey has a residency-based tax system. This means you only pay tax on your worldwide income if you are a tax resident of Turkey.

• Tax residents: You are considered a tax resident if you stay in Turkey for 183 days or more in a calendar year, whether continuously or not. Your immigration status does not affect this; only the number of days you spend in the country. This is important if you plan to apply for Turkey’s Citizenship by Investment program. Tax residents of Turkey must pay taxes on their worldwide income, including earnings from outside Turkey.
• Non-tax residents: If you stay in Turkey for less than 183 days in a calendar year, you are a non-resident for tax purposes. Non-residents only pay local income taxes on income earned in Turkey, not on income from other countries. For companies, if the head office is in another country, the company is a non-resident taxpayer, even if it earns income in Turkey.
• Tax residents (from 1 January 2026): Through a new 20-year income tax exemption introduced in June 2026, under Law No. 7582, certain foreign-sourced income earned by individuals who become Turkish tax residents on or after 1 January can potentially be excluded from income tax for up to 20 years. The provision is for those who were not resident in Turkey or subject to full tax liability there during the three years prior.

Individual income tax rates in Turkey are based on a progressive income tax system with rates ranging from 15% to 40%, depending on taxable income levels. The rates are structured as follows:

Employment income

Non-employment income

Subjects for personal income tax in Turkey

Based on income tax law, individual income tax in Turkey in 2026 can come from a range of sources, including:

• Agricultural profits: Profits from agricultural activities, including planting, hunting, fishing, cultivating, etc
• Pensions: Disability, retirement, orphan pensions, etc
• Income from business: All industrial or commercial activities carried out in permanent establishments
• Wages: Salaries and wages from an employer-employee relationship
• Capital investment: Dividends, interest, rent, etc. (subject to withholding tax)
• Independent personal services income: Turkey taxes for freelancers applies to all freelance services
• Immovable property: Income resulting from land, buildings, quarries and mines, machinery installations, copyrights, trademarks, and vehicles (aircrafts, ships, etc.)
• Non-recurrent income: Earnings that don’t recur regularly, generally one-off events

Social security contributions in Turkey are also something to consider. Generally, the employer is liable for 20.75% of the salary, while the employee pays 14%. However, expat taxes dictate that foreign nationals receive an exemption period of three months on Turkish social security premiums from the employment start date.

While there is a range of options for a Turkey income tax calculator, working with a tax specialist is highly advisable to ensure you understand what taxes you are liable for in Turkey.

Corporate tax in Turkey is currently set at 25%, an important consideration for those thinking of starting a business in Turkey. The Turkey corporate tax rate applies to most companies; however, a higher rate of 30% applies to financial institutions such as banks and insurance companies.

Turkey Free Zones

Turkey’s Free Zones are designated areas inside the country that operate with special rules to encourage trade and investment. Businesses in these zones can import, produce, and export goods without paying VAT or customs duties.

Located near major ports and key markets—such as Istanbul, Mersin, and the Aegean region—these zones make it easier and cheaper for companies to run international operations. They are designed to boost exports, attract foreign investors, and support technology-focused industries.

Here are the 19 free zones in Turkey (18 are active), listed by date of inception:

Turkey’s 2027 corporate tax rate will be reduced to 12.5% for certain businesses working in manufacturing and agriculture. This tax reform slashes the standard rate of 25% in half. Preferential rates also extend to certain exporters.

The standard value-added tax (VAT) rate (sales tax in Turkey) is 20%. There are reduced VAT rates for certain products:

There is also a special consumption tax category for certain industries and products. This special consumption tax is collected once and is applicable to the following:

• Alcohol, sugar drinks, and tobacco products
• Petroleum-based products
• Vehicles (Land, sea, and air)
• Luxury products (phones, caviar, furs, household appliances etc.)

For non-residents of Turkey, capital gains tax only applies to assets within Turkey. Foreign investments generally do not fall under capital gains tax in Turkey.

Assets within Turkey that are sold and earn a profit are taxed, but it depends on how long the asset has been held and the type of asset. Here are some examples:

• Real estate: If you have owned a Turkish property for over five years, capital gains from the sale are exempt. If you sell the property within five years, you are liable for the capital gains, which range from 15%-40%.
• Stocks and bonds: Short-term holdings (under one year) are taxed based on the income bracket of the individual seller. Securities traded on the Istanbul Stock Exchange are exempt if they are held for over one year.

In Turkey, inheritance tax is charged when someone receives property or assets after a person dies. Turkey’s inheritance tax rates range from 1% to 30%, depending on the value of what is inherited and the relationship of the heir to the deceased. Foreigners who inherit property in Turkey must also pay this tax.

Some gifts or property transfers, however, may not be taxed. Turkish inheritance law treats everyone the same, whether you have Turkish citizenship or are a foreign resident. You usually have up to three years from the date of death to pay the inheritance tax.

Article 18 of Law No. 7582 allows the inheritance tax to be cut to a flat 1% on assets received through inheritance during the same period, but this only applies to assets inherited by individuals who qualify for Turkey’s new foreign-source income exemption. This is much lower than the normal progressive inheritance and gift tax rates.

The law also establishes an “Asset Peace” (Varlık Barışı) definition, which permits physical and legal entities to inform Turkish banks or brokerage institutions of specified previously undeclared foreign assets, including cash, gold, and foreign currency and securities, until 31 July 2027.

This is normally a standard tax of 5%. Any foreign assets you declare must usually be transferred to Türkiye within two months.

If you are thinking about buying property in Turkey, it is essential to understand property tax in Turkey for foreigners and residents. Turkish property taxes are as follows:

Percentage figures are taken from the Turkish Revenue Administration. 

Crypto is quickly becoming one of the most popular ways to invest across the globe. In fact, Turkey ranks as the 15th best nation for crypto attractiveness and adoption according to our Global Intelligence Unit report on cryptocurrency.

However, as of 2026, the Turkish government does not have a specific taxation framework for cryptocurrencies, despite the March 2026 crypto tax bill saga, which was proposed and then withdrawn. That being said, crypto transactions in Turkey are seen as capital gains and may be subject to personal or corporate income tax depending on the nature of the transaction.

It is essential for those trading cryptocurrencies in Turkey to know which transaction types are taxed and how this may affect determining taxable income.

Turkey has signed more than 80 Double Tax Treaties (DTTs) with countries worldwide, including major economies like the United States, the United Kingdom, Germany, France, China, and Russia. These treaties are designed to prevent the same income from being taxed twice, making it easier for individuals and businesses to engage in cross-border trade and investment.

Filing taxes in Turkey for foreigners often requires professional help to ensure compliance with Turkish regulations.

To file taxes individuals, and businesses must follow these steps:

1. Get a Tax ID (TIN): Everyone doing business or earning income in Turkey needs a Tax Identification Number, which you can get from a local tax office or online with your passport.
2. Check your residency status:
   • Residents (living in Turkey for more than 183 days in a calendar year) pay tax on income from anywhere in the world.
   • Non-residents only pay tax on income earned in Turkey.
3. Prepare your documents: Collect income statements, receipts, invoices, and any rental or financial records.
4. File online: Taxes are usually filed electronically through the Turkish Revenue Administration. You’ll need a user ID and password from the tax office.
5. Pay your taxes: Payments can be made online, by bank transfer, or in cash at tax offices or partner banks in Turkey.

The Turkey Citizenship by Investment program is a popular option for foreign nationals who want to live in Turkey. There are various ways to invest in Turkey, including: 

• Purchase real estate: Buy property in Turkey valued at a minimum of $400,000.
• Fixed capital investment: Make an investment of at least $500,000 in a Turkish company.
• Bank deposit: Deposit a minimum of $500,000 in a Turkish bank account.
• Government bonds: Invest at least $500,000 in Turkish government bonds.
• Investment in fund shares: Place a minimum of $500,000 in a real estate or venture capital investment fund.
• Job creation: Create employment for at least 50 people in Turkey.

One of the main benefits of the Turkey Citizenship by Investment program is that you can be approved for a Turkish passport in as little as 12 months.

Additionally, Turkey is a good option for those who want to live in Turkey part time with a holiday home without spending more than 183 days in the country to avoid taxation in Turkey for foreigners. Plus, with double taxation treaties with 85 countries, you won’t be taxed twice.

How Can Global Citizen Solutions Help You?

Global Citizen Solutions is an advisory migration consultancy firm with years of experience delivering bespoke residence and citizenship by investment solutions for international families. With offices worldwide and an experienced, hands-on team, we have helped hundreds of clients worldwide acquire citizenship, residence visas, or homes while diversifying their portfolios with robust investments. 

We guide you from start to finish, taking you beyond your citizenship or residency by investment application.