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Tax Guide
Capital Gains Tax Turkey (2026)
Hold your Turkish property for 5 years and pay zero capital gains tax. Here's everything foreign owners need to know about Turkey's CGT rules.
How Capital Gains Tax Works in Turkey
In Turkey, capital gains on real estate are not taxed as a separate "capital gains tax" — they are treated as ordinary income and taxed at the standard progressive income tax rates (15–40%). The good news is the 5-year exemption removes most property transactions from liability entirely.
What is a "Disposal"?
A disposal occurs when you sell, transfer, or otherwise part with your Turkish property. The TAPU transfer date at the notary is the disposal date for CGT purposes.
Calculation Method
Gain = Sale Price − Adjusted Purchase Price. The adjusted purchase price includes the original cost PLUS an inflation adjustment (ÜFE indexation). Associated costs (notary, agent fees) may also be deducted.
Annual Exempt Amount
There is a small annual exempt amount for capital gains (updated annually). For 2026, approximately ₺47,000 of gain is exempt before the progressive rates apply. This is in addition to the 5-year and inflation relief.
The 5-Year Rule in Detail
If you own Turkish real estate for at least 5 complete years from the TAPU transfer date, any gain on sale is completely exempt from CGT. This applies to:
- Residential apartments and villas
- Commercial properties
- Land and plots
- Both residents and non-residents
- Foreign nationals and Turkish citizens
Inflation Adjustment — A Major Benefit in Turkey
Turkey allows the purchase price to be indexed for inflation using the Producer Price Index (ÜFE/Yİ-ÜFE). Given Turkey's historically high inflation rates, this adjustment can dramatically reduce or eliminate a taxable gain.
Worked Example — Sold within 5 Years
Turkey's high inflation means even a 3-year ownership period can generate a meaningful adjustment. For properties held 10+ years (where the 5-year exemption already applies anyway), the adjustment would make the gain negligible even if it were taxable.
CGT by Asset Type
| Asset Type | Exemption Period | After Exemption Period | If Sold Early |
|---|---|---|---|
| Residential property | 5 years | Fully exempt | 15–40% on gain as ordinary income |
| Commercial property | 5 years | Fully exempt | 15–40% on gain as ordinary income |
| Land | 5 years | Fully exempt | 15–40% on gain as ordinary income |
| Turkish-listed shares | 2 years | Fully exempt (individual investors) | 0% currently (special exemption in force) |
| Turkish unlisted shares | 2 years | Exempt | 15–40% on gain |
| Foreign shares / funds | N/A | No general exemption | 15–40% on gain for residents |
| Bonds & fixed income | N/A | Interest subject to WHT | 0–15% withholding typically final |
Non-Resident Rules
You do not need to be a Turkish tax resident for CGT to apply when selling Turkish property. Turkey's source-country taxing rights cover all disposals of Turkish real estate.
How Tax Treaties Affect Turkish CGT
United Kingdom
Article on Capital Gains (typically Article 13)Turkish real estate gains are taxable in Turkey. UK also has the right but provides credit for Turkish tax. Result: pay in Turkey, credit in UK.
United States
US taxes citizens worldwide; treaty Article 13Turkey taxes the Turkish property gain. US claims the right too but allows a foreign tax credit. Result: effectively taxed once at the higher rate.
Germany
Germany-Turkey DTA Article 13Turkey has exclusive taxing right on Turkish immovable property. German return shows the gain but grants exemption (Freistellungsmethode).
Frequently Asked Questions
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