Turkey has approved a new tax regime designed to attract high-net-worth individuals and entrepreneurs relocating to the country. The law, passed by the Turkish Parliament, is now awaiting official publication in the Official Gazette.
At a glance:
- Foreign-source income and gains exempt from tax for up to 20 years
- Inheritance and gift tax reduced to a flat 1% for qualifying individuals
- Applies to those who were not Turkish tax residents and lived abroad for the past three calendar years
- The regime applies retroactively to relocations from 1 January 2026
Who qualifies
To benefit from the special inbound regime, individuals must not have been Turkish tax residents and must have lived outside Turkey continuously for the past three calendar years. Notably:
- individuals who were previously subject to Turkish tax liability can still qualify, provided they meet the three-year requirement; and
- the measure applies retroactively, so those who relocated to Turkey from 1 January 2026 onward can benefit from the regime.
What is exempt — and what is not
The 100% tax exemption applies only to foreign-source income: salaries earned abroad, dividends from foreign companies, overseas business profits, international consulting fees, rental income from foreign properties, and other non-Turkish earnings. Income sourced in Turkey remains fully taxable.
A flat rate on inheritance and gifts
Qualifying individuals may also benefit from a preferential 1% inheritance tax. Under the current system, Turkish inheritance tax ranges from 1% to 30%, depending on the heir’s relationship to the deceased and the value of the estate. The new flat 1% rate effectively caps taxation at the lowest bracket, removing the progressive increase for eligible new residents.
“Turkey aims to position itself as a new hub for global wealth and HNWIs, leveraging the recent abolition of comparable non-domiciled regimes in other countries.”
Why it matters
The move places Turkey alongside a growing list of jurisdictions competing for internationally mobile wealth, at a time when several long-standing non-domiciled regimes elsewhere in Europe have been scaled back or abolished. For families and entrepreneurs comparing relocation options, the attractiveness of a favourable tax regime should always be weighed against the broader legal and succession-planning framework of the destination country — an area where structures such as trusts continue to play a central role in ensuring continuity and protection across generations, regardless of where a family ultimately chooses to live.
Source: Capital Trustees AG