Turkey Tax Information

Tax

The tax system in Turkey is viewed as a progressive system and that the more you earn the higher that rate that you pay. There is a dual taxation treaty between the United Kingdom and Ireland with Turkey.

Personal Income Tax
If you reside in Turkey for over 6 months in a calendar year you are considered as Turkish resident and you will pay income tax on your income in Turkey. The income tax rates are currently as follows:

Tax Band (YTL) Tax %
0 to 7,800 15%
7,801 to 19,800 20%
19,801 to 44,700 27%
Over 44,700 35%

Capital Gains Tax for an individual
The standard rate of tax for Capital Gains is the same as for income tax which is 15% to 35%

Capital Gains Tax for a corporation
The standard rate of corporation tax is 20%. The purchase price of the asset sold is however adjusted in line with the pricing index from the date of the purchase to the date of sale, therefore the Capital Gain is only made on the actual profit. If a depreciable asset is held for more than two years the then it is exempt from tax.

VAT
Vat is imposed on assets and services in Turkey as well as the importation of goods into Turkey.
In most cases the rate of VAT is 18%. Exports are not subject to VAT.

Inheritance and Gift Tax
The tax rate is between 1% and 30% of the value of the asset and is paid over a three year period with two installments being paid each year.

Real Estate Taxes
Annual property tax of 0.1% to 0.3% is payable on land and buildings
A tax of 1.5% is payable on the sale of property. This tax is paid by the vendor and by the purchaser.

Deduction of Tax at Source
In Turkey the following tax is deducted at source:

• Dividends - 10%
• Interest - 10%
• Royalties - 20%
• Professional Services - 20%