Law No. 7582 · June 2026
Türkiye's 20-year tax exemption, explained properly
Published in the Official Gazette on 4 June 2026, Law No. 7582 created the most far-reaching personal tax incentive in the Mediterranean. This page sets out what the law actually says, who qualifies and where the limits are. Verified against primary sources and leading Turkish tax counsel, July 2026.
The core benefit
20 years, 0% on qualifying foreign income
Individuals who become Turkish tax residents are exempt from Turkish income tax on qualifying foreign-sourced income for twenty years. That covers foreign dividends, interest, rental income, capital gains, pensions and business profits earned outside Türkiye.
The exemption applies to people who become tax resident from 1 January 2026 onwards. Exempt income does not even need to be declared in your Turkish annual return. Two limits matter: costs related to exempt income cannot be set off against Turkish taxable income, and foreign tax paid on exempt income cannot be credited.
The three conditions
- No Turkish domicile and no Turkish tax liability in the three calendar years before you become tax resident
- Become a Turkish tax resident: spend more than 183 days per year in Türkiye or establish your domicile there
- The income must be foreign-sourced. Turkish income, including rent from your Bodrum home, is taxed normally
Turkish-sourced income remains taxable. Your Bodrum villa's rental income falls under Turkish rules, softened by an annual allowance and, after five years of ownership, a full capital gains exemption on sale.
Estate planning
Inheritance tax at a flat 1%
For qualifying residents under the new regime, inheritance transfers within the exemption period are taxed at a flat 1%. Under the standard Turkish regime, inheritance is taxed progressively from 1% to 10% and lifetime gifts from 10% to 30%. For substantial estates the difference is measured in millions.
Asset Peace
Declare foreign assets at 5%, down to 0%
Until 31 July 2027, individuals and companies can declare previously unrecorded foreign or domestic assets such as cash, gold and securities. The standard one-off levy is 5%, and declared assets are shielded from tax audits and back-assessment.
The rate falls on a sliding scale if the funds are committed to qualifying Turkish instruments such as time deposits, government bonds, lease certificates or venture capital funds: 4% at one year, 3% at two, 2% at three, 1% at four and 0% at five years. Declared assets must reach Turkish accounts within two months of filing.
Late filings from 1 January 2027 carry a 0.5 point surcharge. Committing funds to lira instruments carries currency risk; weigh the discount against it.
Buying costs
What a Bodrum purchase costs in tax
Title deed fee (tapu)
4% of the sale price, formally split between buyer and seller, in practice usually paid by the buyer. This is the main transaction cost.
VAT exemption for foreign buyers
First purchases of new-build homes are VAT-exempt for non-resident foreign buyers, provided payment arrives in foreign currency from abroad and the home is held for at least one year.
Annual property tax
0.1% to 0.2% for residential property, doubled in metropolitan municipalities such as the Bodrum region. Homes valued above TRY 17.7 million (2026) also attract the progressive valuable housing tax.
Capital gains: the five-year rule
Sell within five years and the gain is taxed at progressive rates. Hold for five years or more and the gain is fully exempt. Note: Turkish property income is Turkish-sourced and sits outside the 20-year foreign income exemption.
Citizenship & residency
The $400,000 route
A property investment of USD 400,000 or more qualifies you to apply for Turkish citizenship, with your spouse and children under 18 included. The property must be held for three years; renting it out is allowed. Typical processing runs six to twelve months from deed to passport.
2026 brought stricter enforcement: valuations run through the official GEDAŞ system, and from May 2026 payments must pass through the mandatory Secure Payment System by bank transfer. A residence permit is available from USD 200,000 in a single property. We plan purchases so the paperwork is right the first time.
Citizenship is optional. The 20-year exemption requires tax residency, not a passport.
How Türkiye compares
The 2026 field, side by side
| Regime | Annual cost | Foreign income | Duration |
|---|---|---|---|
| Türkiye (Law 7582) | None | 0% on qualifying foreign income | 20 years |
| Italy flat tax | EUR 300,000 fixed | Covered by lump sum | Up to 15 years |
| Greece non-dom | EUR 100,000 fixed | Covered by lump sum | 15 years |
| Cyprus non-dom | None | 0% SDC on dividends and interest | 17 years |
| Dubai / UAE | None | No personal income tax | Indefinite |
| Portugal IFICI | None | Requires qualifying activity; excludes passive investors | 10 years |
| Spain (Beckham) | None | 24% flat on Spanish employment income | 6 years |
Türkiye is the only Mediterranean regime that combines zero annual cost, a full exemption on foreign income and a twenty-year horizon. The honest counterweights: the lira is volatile, the regime is young and Türkiye sits outside the EU. We discuss both sides in every consultation.
Rates verified July 2026 against primary sources. Italy raised its flat tax from EUR 200,000 to EUR 300,000 in 2026; Portugal's NHR closed to new applicants at the end of 2024.
Quick self-check
Are you eligible?
Three questions decide most cases:
- 1Have you been outside Turkish tax residency and domicile for the last three calendar years?
- 2Can you spend more than 183 days a year in Türkiye, or make it your genuine home base?
- 3Is the income you want to protect earned outside Türkiye: dividends, interest, foreign rents, pensions or business profits?
Three times yes and the regime very likely works for you. Bring your situation to a consultation and we will map it precisely with Turkish tax counsel before you commit to anything.
A necessary word of caution
Turkey20 is a property and relocation advisory, not a licensed tax adviser. Everything on this page reflects Law No. 7582 and related legislation as of July 2026, verified against primary sources and leading Turkish tax publications. Legislation changes and personal circumstances differ. Before acting, obtain written advice from a qualified Turkish tax professional. We will gladly introduce you to the counsel we work with.
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