Türkiye · Tax regime
Twenty-Year Foreign-Source Income Exemption (Income Tax Law Article 20/D, introduced by Law No. 7582)
Enacted by Law No. 7582, passed by parliament 21 May 2026, signed by the President 3 June 2026 and published in the Official Gazette on 4 June 2026. In force on publication but applies to individuals deemed Turkish tax resident from 1 January 2026, giving it limited retroactive reach. Secondary implementing guidance from the Revenue Administration remained limited at the time of writing.
This is the single most consequential development in the region in 2025–26. Türkiye has, for a defined class of new arrivals, converted itself from a worldwide-taxation country into something more generous than most European non-dom regimes: twenty years — not fifteen (Italy, Greece) or ten (Portugal's IFICI) — of complete exemption on foreign-source income and gains, with no lump-sum charge, plus a 1% inheritance rate. Stacked with a CBI programme requiring no residence, a family can take the passport first and decide later whether to switch on the tax regime.
Qualifying routes
no investment threshold; the regime is a tax status, not a purchase
The facts
- Total landed cost
- No government charge. The cost is establishing genuine Turkish tax residency — housing, the 183-day presence that ordinarily triggers residency, and professional fees to structure and defend the foreign-source characterisation.
- Timeline
- 1–6 months — Follows automatically from establishing tax residency; the binding constraint is obtaining a residence permit or citizenship first.
- Physical presence
- Tax residency is the trigger. Türkiye treats an individual as resident if domiciled in Türkiye or present for more than six months (183 days) in a calendar year.
- Family
- each individual qualifies on their own facts; there is no family unit test
- Permanent residency
- n/a — this is a tax status, not an immigration status
- Citizenship
- n/a
- Language test
- none
- Dual citizenship
- Permitted
- Requirements
- become a Turkish tax resident on or after 1 January 2026no Turkish domicile in the three calendar years preceding residenceno full Turkish tax liability in those three years (limited carve-out for prior local rental, securities and capital gains taxation)income must be genuinely derived outside Türkiye
- THE REGIME IS SIX WEEKS OLD. Gazetted 4 June 2026. There is minimal implementing guidance, no case law, and no track record of how the Revenue Administration will police the foreign-source boundary. Anyone modelling an eight-figure decision on it should treat the detail as provisional and seek a ruling.
- THE THREE-YEAR CLEAN-HISTORY TEST IS ABSOLUTE. You must have had no Turkish domicile and no full Turkish tax liability in the three calendar years before becoming resident. A carve-out reportedly preserves eligibility for those who previously paid Turkish tax only on local rental income, securities income or capital gains — but if you have been filing as a Turkish resident you are out, and a CBI investor who took a residence permit early may have contaminated their own clock.
- ONLY FOREIGN-SOURCE INCOME IS EXEMPT. Salary from a Turkish company for work done in Türkiye, rent on Turkish property, dividends from Turkish companies and gains on Turkish-listed shares are all Turkish-source and taxable at up to 40%. If you buy the CBI property and rent it out, that rent is taxable.
- NO DEDUCTIONS, NO CREDITS. Expenses connected to exempt foreign income cannot be deducted, and foreign taxes paid on the exempt income cannot be credited. If your foreign income is already taxed at source — US-source dividends, for instance — the Turkish exemption gives you nothing and you cannot recover the foreign withholding.
- THE GIFT TAX POSITION IS UNCLEAR. Reporting is inconsistent: some sources say the 1% flat rate covers both inheritance and gifts for regime participants, others that it applies only to succession on death within the exemption period and that lifetime gifts fall outside. We could not resolve this from primary sources. Do not plan lifetime gifting around the 1% rate without a ruling.
- OTHER COUNTRIES GET A VOTE. Becoming Turkish tax resident does not automatically end residency elsewhere. Treaty tie-breakers, your home country's exit tax and prior-jurisdiction CFC rules all bite independently. Türkiye's own CFC rules (Corporate Income Tax Law Article 7) attribute undistributed passive income of low-taxed foreign companies to Turkish residents, and it is not clear that Article 20/D neutralises a CFC attribution, which is Turkish-source by construction.
- A separate 'Asset Peace' repatriation window runs to 31 July 2027, allowing declared cash, gold, foreign currency and securities into Türkiye at 0–5% with no audit of declared assets. Attractive, but repatriation amnesties attract correspondent-bank attention and the source-of-funds question does not disappear because Türkiye has stopped asking it.