Turkey: Turkey Introduces A New Tax Amnesty: Opportunities And Risks For Turkish International Investors

Last Updated: 2 August 2018
Article by Burcin Gozluklu and Ramazan Biçer

Tax amnesty laws introduced by Turkish governments closely concerns Turkish investors who have overseas assets. We observe that Turkish international investors benefit from time to time the tax amnesty laws which are issued in 4-5 years on average.

Enacted in 2016 as the last tax amnesty, "the Law No. 6736 on Re-structuring of Certain Public Receivables" allowed Turkish taxpayers to benefit from tax free program without repatriating foreign assets, on the condition that they declared such assets before a financial institution in Turkey until June 30, 2017.

On May 11, 2018, Turkish Assembly passed a new tax amnesty law which covers repatriation of foreign assets and provides a new opportunity for Turkish investors who hold assets in their overseas accounts but have not declared, yet. As we consider the upcoming international automatic exchange of information on the financial accounts (known as Common Reporting Standard), the new tax amnesty law becomes more of an issue for Turkish investors.

What Does the New Tax Amnesty Bring for Turkish Investors?

Under new tax amnesty law No. 7143, if Turkish investors, who have foreign assets such as money, gold, foreign exchange, securities, and other capital market instruments, declare these assets before a financial institution in Turkey and repatriate them to Turkey until July 30, 2018, they will freely use such assets without paying any taxes. Accordingly, if a Turkish taxpayer fulfils the condition of declaration and repatriation of foreign assets until the above-mentioned date, he will not face with any taxation in Turkey.

However, if a tax payer prefers to declare and transfer his foreign assets between dates of August 1 and November 30, 2018, there will be 2% tax applicable. Taxes will be collected and paid by financial institutions by December 31, 2018 upon the declaration of foreign assets.

As can be easily understood, there is a requirement to declare and repatriate foreign assets to Turkey until either 31 July or November 30, 2018 if one wishes to benefit from the new tax amnesty. It is worthy to underline that contrary to previous tax amnesty, it is not sufficient to only declare foreign assets to benefit from the provisions of the new tax amnesty law.

Consequently, under both options, one should repatriate his foreign assets to Turkey to benefit from the either tax free or 2% tax option.

Due Date to Repatriate Foreign Assets to Turkey

Based on the new tax amnesty law, there is a condition that taxpayers repatriate their foreign assets to Turkey to benefit from the tax amnesty within 3 months after their declaration.

For instance, if one holds foreign exchange in an overseas account and declares his assets on the date of July 31, 2018 under the new tax amnesty law, he has to either actually repatriate his assets to Turkey or transfer these assets to the new account to be opened at a Turkish bank or brokerage house until October 31, 2018.

How can the Corporates Benefit from the New Tax Amnesty Law?

It is also possible for the corporates to benefit from the new tax amnesty. In this sense, Turkish taxpayers may use their foreign assets;

  • to pay off their corporate loans which were obtained from the foreign banks or financial institutions and
  • to write down the capital advance payments recorded in their corporate books (on the condition that the assets were repatriated to Turkey before enactment of the tax amnesty law).

In addition, individual and corporate taxpayers in this scope may either include their foreign assets in their legal books or withdraw these assets later on with no consideration as they determine their taxable income and distributable profits of their corporations.

Here two options are also available for the corporates. Thus, those who repatriate and include their foreign assets in their corporate books until July 31, 2018 will be allowed to benefit from the option where no tax is applicable; however, those who carry out repatriation and inclusion of foreign assets in their corporate books until November 30, 2018 will have to pay 2% tax to benefit tax amnesty program.

Should Turkish International Investors Benefit from the New Tax Amnesty?

We can say there would be some other tax amnesties to be announced in the future years. Turkish governments will definitely decide this. However, the upcoming period will be different from the previous one even if Turkish governments introduce new tax amnesty laws in the future years.

We observe in practice that Turkish international investors have an understanding that "do not declare the foreign assets, wait for the next tax amnesty and pay taxes at that time if requested in Turkey".

However, we believe that this is not a sustainable approach, anymore. The reason is in fact simple: details of financial accounts of Turkish international investors will be regularly exchanged each year by other countries with Turkey.

This will be handled by the countries through international automatic exchange of information mechanism introduced by OECD and G-20 countries, based on Multilateral Convention on Mutual Administrative Assistance in Tax Matters which was also ratified by Turkey in 2017.

By this mechanism, Turkish Tax Authorities will be informed about the foreign assets held in the overseas accounts by Turkish investors and accordingly, they will be able to question whether any income was declared by taxpayer for the relevant tax year in relation to those assets. If no income declaration made on these foreign assets, there would be tax penalties in addition the main taxes applicable on such income.

At this point, we advise that Turkish investors who own foreign assets apply for the tax amnesty program before the due date and benefit from the favourable options if they never declared and paid taxes for their overseas assets in the previous financial years.

For the future years, it is also advisable that Turkish investors restructure their foreign assets by considering international automatic exchange of information on the financial accounts.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions