Taxes in Turkey

Taxes in Turkey are an important consideration for property buyers, investors, landlords, and anyone planning to sell real estate. While property purchase costs are covered in our expenses and costs guide, this article focuses on the key taxes that apply after purchase, including income tax, rental income tax, capital gains tax, and corporate tax.

This guide is designed for international buyers looking to understand how taxes in Turkey work when buying, holding, renting, and selling property.

Income Tax in Turkey

Turkey applies progressive income tax rates to individuals. Annual income tax declarations are typically submitted in March each year, with payments made in two instalments: March and July.

For property owners, income tax is relevant for rental income and capital gains (if applicable).

2025 Income Tax Brackets in Turkey

Rental Income Tax in Turkey

If you rent out a property in Turkey, rental income may be taxable. The final taxable amount depends on deductions, exemptions, and allowable expenses such as maintenance, insurance, and management costs.

Foreign property owners are generally taxed on rental income generated within Turkey, even if they reside abroad.

Rental Income Tax Example

If a property generates 300,000 TRY per year in rental income, allowable expenses are deducted first. The remaining amount is then taxed progressively according to the income tax brackets above.

This means rental income is not taxed at a flat rate, but increases depending on total income levels.

Capital Gains Tax in Turkey

Capital gains tax may apply when selling property in Turkey. If the property is sold within five years of purchase, any profit is subject to income tax.

However, if the property is held for more than five years, the gain is generally exempt from capital gains tax for individuals.

How Capital Gains Tax Is Calculated

The taxable gain is calculated based on the difference between purchase and sale price, adjusted for inflation using official government indices.

• Purchase price (title deed value)
• Sale price
• Inflation-adjusted cost base
• Applicable income tax brackets

Inflation indexation can significantly reduce the taxable gain, especially during periods of high inflation.

Capital Gains Example

If a property is bought for 1,000,000 TRY and sold for 3,000,000 TRY within five years, the nominal gain is 2,000,000 TRY.

After inflation adjustment, the taxable gain may be significantly lower, and the remaining amount is taxed progressively.

Corporate Tax for Property Investors

Companies owning property in Turkey are subject to corporate tax rather than personal income tax. The standard corporate tax rate is 25%, with certain sectors taxed at higher rates.

Corporate ownership may be beneficial for large-scale investors, but it removes the five-year capital gains exemption available to individuals.

Buying Property Personally vs Through a Company

Taxes for Foreign Property Owners

Foreign investors are subject to Turkish tax on income generated within Turkey.

• Rental income is taxable in Turkey
• Capital gains tax applies within five years
• Double taxation agreements may apply
• Income may need to be declared abroad

Inheritance and Property Transfer Tax

Property can be transferred through inheritance, and inheritance tax may apply depending on the value and relationship between parties. Rates are progressive and vary depending on the circumstances.

Key Tax Timeline for Property Owners

• Purchase: Title deed tax and transaction costs
• Holding: Annual property tax
• Rental: Income tax on rental income
• Sale: Capital gains tax (if within 5 years)

Important Disclaimer

This guide is for general information only and does not constitute tax advice. Tax regulations may change, and individual circumstances vary.

You should consult a qualified Turkish accountant before making any investment or sale.