Capital gains tax in Turkey

Turkey does not levy a standalone capital gains tax. Instead, gains from the disposal of assets are folded into the ordinary personal income tax (gelir vergisi) system and taxed at the same progressive rates that apply to other forms of income. The legal basis is the Income Tax Law No. 193 (Gelir Vergisi Kanunu -- GVK), administered by the Turkish Revenue Administration, Gelir Idaresi Baskanligi (GIB). Understanding the rules requires separating three distinct asset categories: real property, listed shares, and everything else.

For context on where Turkey fits among tax jurisdictions, see the Turkey country overview.

How are capital gains from real-estate disposals taxed?

Gains arising from selling Turkish immovable property (land, apartment, villa, commercial unit) acquired after 1 January 2007 are classified as deger artis kazanci (value-increase gains) under GVK Duplicate Article 80. The key rule: if five full calendar years have elapsed between the title-deed registration date (tapu tescil tarihi) and the disposal date, the gain is fully exempt from income tax -- no filing, no liability. This five-year clock runs from the tapu, not from the date of construction or occupation. Property received by inheritance or gift is outside the scope of this rule entirely and carries no capital gains liability regardless of holding period. [1]

For disposals within five years, the seller computes the taxable gain by subtracting the inflation-adjusted acquisition cost (see below) plus qualifying documented expenses (notary fees, property purchase tax, renovation costs) from the sale price. The resulting net gain is reduced by the annual exclusion (istisna): TRY 120,000 for disposals made in the 2025 calendar year (filed March 2026); the exclusion rises to approximately TRY 150,000 for 2026 disposals per the annually-revalued schedule. Only the amount above this threshold is added to the taxpayer's total income for the year and taxed at the progressive rates in the table below. [1][2]

Filing deadline: the Deger Artis Kazanci Beyannamesi (value-increase gains declaration) must reach GIB by 31 March of the year following disposal; tax is paid in two equal instalments due 31 March and 31 July.

What are Turkey's income tax brackets for 2026?

Capital gains not eligible for withholding-as-final-tax are aggregated with the taxpayer's other income and taxed at Turkey's progressive rate schedule. For 2026, the non-employment income brackets are: [3]

Brackets are revalued upward each year by Turkey's official revaluation coefficient to partially offset lira inflation. For 2026 the coefficient produced a roughly 25% upward shift from 2025 thresholds. [3]

How does inflation indexation reduce the taxable gain?

Turkey's Income Tax Law permits sellers to inflate their acquisition cost using the Yurt Ici Uretici Fiyat Endeksi (Yi-UFE, the Domestic Producer Price Index) before computing the gain -- but only when Yi-UFE rose by more than 10% between the month before acquisition and the month before disposal. When the threshold is met (which it reliably has been during Turkey's recent high-inflation period), the purchase price is multiplied by the Yi-UFE index ratio, meaningfully reducing the nominal gain that feeds into progressive tax brackets. The adjustment is available for real-estate disposals, qualifying business-asset sales, and certain other asset categories; it does not apply to listed-share gains handled under Temporary Article 67 withholding. [1][2]

Practical effect: a property bought for TRY 1,000,000 when Yi-UFE stood at 400 and sold when Yi-UFE is 900 would have its adjusted cost basis recognised at TRY 2,250,000 -- eliminating the taxable gain on purely inflation-driven appreciation and taxing only real-terms value growth.

How are gains from BIST-listed shares taxed?

Shares purchased after 1 January 2006 and traded on Borsa Istanbul (BIST) fall under the special withholding regime of Temporary Article 67 of GVK. For BIST-listed equities (excluding investment-trust shares) and equity-index futures, the withholding rate is 0% -- meaning disposal gains pass through the brokerage with no tax deducted, and resident individuals do not need to include these gains in their annual return. [4] This makes BIST-listed shares among the more tax-efficient asset classes in Turkey for resident individual investors.

For equities outside the 0% category (including shares of unlisted companies and securities not admitted to BIST), a 10% withholding rate applies. Withholding under Temporary Article 67 is treated as final taxation for non-resident individuals -- no Turkish tax return is required and no additional liability arises. Resident individuals have the election to include gains taxed by withholding in their annual return if the progressive calculation produces a lower liability, which is typically relevant only when total annual income falls in the 15% bracket. [4]

Shares of foreign-listed companies (not BIST) held by Turkish tax residents do not benefit from Temporary Article 67 and must be declared in the annual income tax return, with gains taxed at progressive rates after applying the annual exclusion thresholds. Foreign taxes paid may be credited against Turkish liability under applicable double-tax treaties.

How are non-residents treated?

Non-resident individuals are subject to Turkish capital gains tax only on Turkish-source disposals -- Turkish real property, BIST-listed shares, and stakes in Turkish companies. [2][5] Non-residents receive the same TRY 120,000 annual exclusion (2025) on real-estate gains as residents. For real estate, the gain must be reported via a special (munferit) declaration submitted within fifteen days of the transaction, with the tax paid at that time rather than in the standard March filing window. Withholding under Temporary Article 67 constitutes final tax for non-residents, so BIST-listed share gains carry no additional filing obligation in Turkey. Turkey has more than 90 active double-tax treaties; treaty-resident non-residents should verify whether the relevant treaty restricts Turkey's source-country taxation right on specific gain categories before assuming full Turkish liability. [5]

Turkey's capital gains rules reward long-term holding and index-linked cost recovery. The interaction between the five-year real-estate exemption, the Yi-UFE indexation adjustment, and the progressive rate schedule means two sellers of identically-priced properties can face vastly different tax outcomes depending on how long they held the asset and when they acquired it relative to inflation cycles. Anyone facing a material disposal should consult a qualified tax professional before structuring the transaction. For cross-border disposals or non-resident sellers, specialist input is particularly important given the interplay of domestic rules and treaty provisions. A vetted local specialist can be found through the Turkey country overview.