Taxes in Turkey in 2026 depend mainly on tax residency, income source, asset type, and whether the taxpayer is an individual or company. Turkish tax residents are generally taxed on worldwide income, while non-residents are taxed only on Turkish-source income and assets located in Turkey.
Tax residency in Turkey
A person may be treated as a Turkish tax resident if they:
- Have a permanent place of residence in Turkey
- Spend more than 183 days in Turkey during a calendar year
Foreigners temporarily staying in Turkey for education, medical treatment, tourism, or official assignments may not be treated as tax residents even if they remain longer.
Non-residents may still owe tax in Turkey if they:
- Own real estate in Turkey
- Own vehicles or yachts registered in Turkey
- Receive interest from Turkish bank deposits
- Rent out Turkish property
- Conduct business or earn other Turkish-source income
New tax regime for foreign residents
From 2026, Turkey introduced a special regime for new tax residents under Law No. 7582 of 4 June 2026.
To qualify, an individual must not have been a Turkish tax resident during the previous three calendar years and must meet other statutory conditions.
The regime provides:
- Exemption from Turkish tax on foreign income for up to 20 years
- Reduced inheritance and gift tax rate of 1%
- No obligation to declare qualifying foreign income
Turkish-source income remains taxable under standard rules. This includes employment income, business profits, Turkish rental income, and dividends from Turkish companies.
Personal income tax
Individuals may be taxed on:
- Salaries, self-employment income, benefits, and pensions
- Rental income
- Inheritance and valuable gifts
- Capital gains from real estate sales
- Bank interest, bond income, and dividends
In 2026, progressive personal income tax rates are:
| Annual income | Tax rate |
|---|---|
| Up to TRY 190,000 | 15% |
| TRY 190,000–400,000 | 20% |
| TRY 400,000–1,500,000 | 27% |
| TRY 1,500,000–5,300,000 | 35% |
| Above TRY 5,300,000 | 40% |
For employment income, the 27% bracket applies up to TRY 1,000,000.
The tax is progressive. For example, a person earning TRY 300,000 annually pays 15% on the first bracket and 20% only on the amount above the relevant threshold.
Tax on bank interest and dividends
Interest on Turkish bank deposits is taxed according to the deposit term:
| Deposit term | Tax rate on interest |
|---|---|
| Up to 6 months | 17.5% |
| 6–12 months | 15% |
| More than 1 year | 10% |
The currency of the deposit does not affect the applicable rate.
The standard withholding tax on dividends paid by Turkish companies is 15%. Double taxation treaties may reduce the effective rate. Some government bonds and exchange-traded securities may receive exemptions or preferential treatment depending on the asset type, holding period, and investor status.
Individual deductions
The following expenses may generally be deducted from taxable income:
- Social security and health insurance contributions paid for oneself or family members
- Education expenses for oneself, children, or a non-working spouse, up to 10% of annual income
- Donations to qualifying state and municipal funds
- Property maintenance expenses
- For landlords, up to 15% of rental income
- Business expenses for self-employed individuals, including equipment, premises, and advertising
- Transaction and renovation costs when selling real estate
Employees in Turkey contribute 15% of gross salary to social security and unemployment insurance systems. In 2026, contributions apply only up to a government-set monthly ceiling of TRY 297,270.
Filing and payment deadlines
Employers calculate and pay payroll taxes on behalf of employees.
Landlords, entrepreneurs, property sellers, bondholders, and deposit account holders generally submit tax returns online by the end of March.
Common payment deadlines include:
- Property tax: paid in two instalments, in May and November
- Personal income tax: generally paid by the end of March and in July
Inheritance and gift tax
Inheritance and gift tax rates depend on the value of the transferred property:
| Property value | Inheritance tax | Gift tax |
|---|---|---|
| Up to TRY 2.4 million | 1% | 10% |
| Up to TRY 8.1 million | 3% | 15% |
| Up to TRY 20.1 million | 5% | 20% |
| Up to TRY 44.1 million | 7% | 25% |
| Above TRY 44.1 million | 10% | 30% |
The tax is calculated progressively across brackets.
Annual exemptions in 2026 include:
- TRY 2,316,628 for each child and spouse
- TRY 4,636,103 for a surviving spouse with no children
- TRY 53,339 for gifts
Inheritance and gift taxes may be paid in six instalments over three years.
Gift tax is generally higher than inheritance tax, but gifts may still be used for estate planning, especially because of Turkey’s forced heirship rules.
Property taxes
Real estate tax applies to both individuals and companies and is collected by municipalities.
Rates are generally higher in major cities such as Istanbul, Ankara, Izmir, and Mersin than in smaller municipalities.
| Property type | Major cities | Smaller municipalities |
|---|---|---|
| Residential | 0.2% | 0.1% |
| Commercial | 0.4% | 0.2% |
| Development land | 0.6% | 0.3% |
Turkey is gradually adjusting taxable property values toward market values while accounting for inflation.
Valuable Housing Tax
Residential properties valued above TRY 17.7 million are subject to additional Valuable Housing Tax.
| Property value | Tax rate |
|---|---|
| TRY 17.7 million–26.6 million | 0.3% |
| TRY 26.6 million–35.4 million | 0.6% |
| Above TRY 35.4 million | 1% |
The source gives slightly inconsistent figures for the lower thresholds, so the exact bracket boundaries should be checked before filing.
Property tax payments may be made through municipalities, the e-Devlet portal, or participating Turkish banks.
Capital gains from real estate sales are generally taxed as personal income, but gains are usually exempt if the property has been owned for more than five years.
Rental income is included in annual taxable income. In 2026, owners of residential property are exempt if annual rental income does not exceed TRY 47,000. Documented expenses such as insurance, repairs, and maintenance may be deducted.
Corporate tax
A company is generally treated as a Turkish tax resident if its registered head office is in Turkey. Non-resident companies are taxed only on Turkish-source income.
Key business taxes include:
- Corporate income tax: 25%
- Corporate income tax for financial institutions: 30%
- Employer social security and unemployment contributions: 22.75% of employee salaries
- VAT: 1%, 10%, or 20%, depending on the goods or services
Additional taxes may include:
- Stamp duty on contracts, tax returns, and financial statements, generally from 0.2% to 1%
- Special Consumption Tax on tobacco, luxury vehicles, yachts, oil, gas, and similar products
- Property tax
- Vehicle tax
Capital gains from securities and property sales are generally included in taxable profits. Companies may receive up to a 50% exemption on gains from the sale of Turkish shares held for more than two years.
Foreign companies operating in Turkey are generally required to use a licensed Turkish accountant authorised to submit tax filings and reports.
Technology parks and free zones
Turkey’s Technology Development Zones and Free Zones offer tax and customs incentives for qualifying businesses.
Companies operating in technology parks may receive exemptions from corporate tax on qualifying R&D and software income until 31 December 2028. Salaries of employees engaged in R&D and software development may also be exempt from personal income tax and stamp duty.
Businesses operating in Free Zones may benefit from VAT and customs duty exemptions. Export-oriented manufacturers may also receive corporate tax incentives.
Technology parks are mainly relevant for IT companies and start-ups. Free Zones are more commonly used by manufacturing, trading, and logistics businesses.
Turkey’s 2026 tax system offers different outcomes depending on residency status, foreign income, Turkish-source income, property ownership, and business structure. The new regime for qualifying foreign residents may significantly reduce tax exposure on foreign income, but Turkish-source income and local assets remain subject to standard Turkish tax rules.
Source article: www.astons.com
