Key Tax Rates at a Glance
| Tax Type | Rate | Tier | Notes | Source |
|---|---|---|---|---|
| Income Tax — top rate | 40.0% | High Tax | Top marginal rate | OECD 2026 |
| Income Tax — lowest rate | 15.0% | Entry rate | OECD 2026 | |
| Corporate Tax | 25.0% | Moderate | Standard rate | OECD 2026 |
| VAT | 20.0% | Moderate | Standard rate | OECD 2026 |
| Capital Gains Tax | 0.0% | Zero | Standard rate | OECD 2026 |
| Social Security (employee) | 14.0% | Employee contribution | OECD 2026 | |
| Territorial Taxation | No | Worldwide taxation | OECD 2026 | |
| Digital Nomad Visa | Yes | Check official government sources | Official |
Turkey Special Tax Regime
| Criterion | Detail |
|---|---|
| Who qualifies | Qualifying expats, investors and skilled workers. |
| Tax rate under regime | Reduced rate under Turkey Special Tax Regime. |
| Duration | Varies — consult official government sources. |
| Application process | Apply through Turkey Tax Authority. |
| Key restriction | Must not have been tax resident in prior years. |
Income Tax Brackets
Income Tax Brackets
Turkey operates a progressive income tax system with five brackets, scaled to Turkish Lira (TRY) thresholds. At ~32 TRY per USD, the brackets translate into manageable thresholds for many expats. Turkish residents are taxed on worldwide income; non-residents are taxed only on Turkish-source income. Standard deductions and limited personal exemptions apply.
| Annual Income (TRY) | Annual Income (USD equiv.) | Tax Rate |
|---|---|---|
| TRY 0 – 110,000 | $0 – $3,400 | 15% |
| TRY 110,001 – 230,000 | $3,400 – $7,200 | 20% |
| TRY 230,001 – 580,000 | $7,200 – $18,100 | 27% |
| TRY 580,001 – 3,000,000 | $18,100 – $93,750 | 35% |
| TRY 3,000,000+ | $93,750+ | 40% |
Key point for expats: If your global income remains below ~$93,750 annually, your top marginal rate is 35%. The 40% bracket kicks in only at very high incomes, making Turkey tax-efficient for mid-to-upper-range earners compared to Western Europe or North America.
Corporate Tax
Corporate Tax
Turkey's standard corporate income tax rate is 25%, increased from 20% in 2023 as part of fiscal consolidation. Financial institutions and certain banks face a higher 30% rate. Dividends paid to non-resident shareholders are subject to withholding tax, typically 15% (reduced under applicable tax treaties). SMEs benefit from limited incentives in designated economic zones.
Turkey imposes corporate tax on Turkish-source income for non-resident corporations; Turkish corporations are taxed on worldwide income. Transfer pricing rules align with OECD guidelines, important for multinational operations or related-party transactions.
VAT & Consumption Taxes
VAT & Consumption Taxes
The standard VAT (KDV) rate is 20%, increased from 18% in 2023. Reduced rates apply: 10% on essential food items, medicine, and medical devices; 1% on certain agricultural products and new residential properties. Export transactions are zero-rated. VAT registration thresholds and reverse-charge mechanisms apply in certain sectors.
Expats and residents experience VAT on purchases in the same manner. Importers and online sellers face compliance obligations under Turkish customs and VAT administration.
Capital Gains & Investment Income
Capital Gains & Investment Income
Turkish-source capital gains on stocks: 0% for Turkish resident individuals — this is a significant tax advantage. Capital gains on real property, however, are taxed on a tiered basis: holdings of less than 1 year incur 40% tax; 1–5 years range from 40% down to 15%; holdings exceeding 5 years are exempt. This encourages long-term property investment.
Dividend income from Turkish companies is taxed as ordinary income at progressive rates. Foreign-source capital gains and dividends face worldwide income taxation for Turkish residents, subject to foreign tax credits and applicable treaties.
Digital Nomad & Expat Visas
Turkey offers a dedicated digital nomad or remote-work visa. Check official government sources Holders typically benefit from the Turkey Special Tax Regime.
Tax Scenarios — Effective Rates
Estimated all-in tax burden after income tax and employee social security. Assumes standard deductions; does not account for special regimes or itemised relief.
Tax Burden Calculator
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Key Insight
A digital nomad visa is available, attracting remote workers seeking a lower-tax base.
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Moving to Turkey?
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Frequently Asked Questions
Comparisons
Social Security & Benefits
Social Security (SGK)
Turkey's social security system (SGK) is notably expensive for employers. Employees contribute 19% of gross salary (14% pension, 5% health insurance). Employers contribute 31% (20.5% pension, 10.5% health). These high rates reflect comprehensive pension and healthcare coverage but significantly impact total employment costs.
Turkish residents working abroad may maintain voluntary contributions. Turkey has bilateral social security agreements with EU, EFTA, and other countries to avoid double contributions and ensure portability of benefits for expats who relocate.