Turkey's Revenue Administration has published an updated guide on how individuals should report and pay tax on investment income — including dividends, interest, and bond returns — for the 2025 tax year, setting out declaration thresholds, allowable deductions, and filing procedures for both residents and non-residents.
Turkey’s Revenue Administration has published an updated guide on the taxation of investment income for the 2025 tax year under the Individual Income Tax Law.
The guide covers income from capital, including dividends, interest on bank deposits, Eurobonds, lease certificates, and treasury bonds. It defines the financial thresholds that trigger a formal declaration requirement and outlines allowable deductions — such as depository fees, insurance charges, and collection expenses — used to determine net taxable investment income.
The guide also details applicable tax brackets, the 2026 payment schedule, and the procedures for filing via the Pre-filled Declaration System through the Digital Tax Office, while clarifying the distinct reporting obligations for non-resident citizens and full taxpayers.
Tax treatment of dividends
The guide outlines different treatments for domestic and foreign dividends:
- Domestic dividends: For dividends received from full taxpayer institutions in Turkey, half (50%) of the gross dividend is exempt from income tax. Only the remaining half is considered for the TRY 330,000 declaration threshold. The 15% tax withheld at the corporate level is fully deductible from the final income tax calculation.
- Foreign dividends: Dividends from foreign companies (limited or joint-stock) can also benefit from a 50% exemption if specific conditions are met: the taxpayer must own at least 50% of the company’s paid-in capital, and the funds must be transferred to Turkey by the tax filing deadline.
- Exceptions: Dividends from profits earned on or before 31 December 1998 are entirely exempt from declaration regardless of the amount.
Special provisions for non-residents
Taxation for non-residents differs based on their status and the nature of the income:
- Turkish citizens abroad: Citizens living abroad for more than six months with work or residence permits are generally treated as non-residents for tax purposes.
- Withholding as final tax: If a non-resident’s income in Turkey consists solely of investment income that has already been subject to withholding, they generally do not need to file an annual return.
- Individual returns: If a non-resident earns investment income that was not subject to withholding, they must file an individual return and pay the tax within 15 days of obtaining the income.
- Exceptions: Eurobond interest earned by non-residents is subject to a 0% withholding rate and does not need to be declared.
Declaration thresholds and inflation adjustments
Turkish tax law sets specific thresholds to determine if investment income must be declared. For the 2025 calendar year, the following limits apply:
- TRY 18,000 threshold: This applies to income that is not subject to tax withholding or to any specific exemptions in Turkey (e.g., offshore bank interest or interest on loans between individuals). If the total of such income exceeds this amount, the entire amount must be declared. (Note: This threshold increases to 22,000 TL for 2026 income).
- TRY 330,000 threshold: This applies to income already subject to tax withholding or specific exemptions (e.g., domestic dividends, Eurobond interest). If the taxable portion of this income exceeds 330,000 TL, a declaration is required. (Note: This threshold increases to 400,000 TL for 2026 income).
- Inflation Adjustment (Discount Rate): To protect taxpayers from inflation, a discount rate is applied to certain income, such as interest from government bonds and treasury bills issued before 1 January 2006. The discount rate for 2025 is 64.91%. This means only the remaining amount after applying this rate is considered when determining whether the 330,000 TL threshold is met.
Annual tax filing and payment
For 2025 income, annual tax returns must be filed between 1 and 31 March 2026, with the resulting tax payable in two equal instalments — the first by 31 March 2026 and the second by 31 July 2026.
Returns can be submitted through the Pre-filled Return System, which automatically prepares a return based on available data for the taxpayer’s approval, accessible via the Digital Tax Office website or mobile app.
Special provisions apply in certain circumstances: taxpayers permanently leaving the country must file within 15 days before departure, while in the event of death, heirs have four months to submit the return.
Each return submitted is subject to a stamp duty.
