IMPORTANT: This article describes a tax reform package approved by the Turkish Parliament on 21 May 2026. The law is not yet in force. It is awaiting publication in the Resmi Gazete (the Official Gazette of Turkiye). The provisions described below are based on the approved package and may change before they take effect. Nothing here should be relied upon as final until the law is officially published. This is general information, not tax or legal advice.
On 21 May 2026, the Turkish Parliament approved a new tax reform package introducing long-term tax incentives for qualifying new tax residents. If it enters into force as approved, it would position Turkiye among the more competitive jurisdictions in the region for internationally mobile individuals relocating their tax residency.
The headline is striking: exemption from taxation on qualifying foreign-source income and certain foreign capital gains for up to 20 years, a reduced inheritance and gift tax rate of 1%, and no obligation to declare qualifying foreign income in Turkiye. For high-net-worth individuals and entrepreneurs evaluating where to establish tax residency, a regime of this length and scope would be significant.
Below is what the approved package contains, who it is expected to apply to, how it compares to similar regimes elsewhere, and the critical caveats, including the fact that the law is not yet in force.
What the Approved Package Contains
The reform package approved on 21 May 2026 introduces a set of long-term incentives aimed specifically at individuals who become Turkish tax residents after the law enters into force. The proposed regime may include the following provisions.
The core provisions
- Exemption from taxation on qualifying foreign-source income and certain foreign capital gains for up to 20 years
- A reduced inheritance and gift tax rate of 1%
- No obligation to declare qualifying foreign income in Turkiye
- Turkish-source income will continue to be taxed under standard local rules
IMPORTANT: These provisions are drawn from the approved package and are described as what the regime ‘may include.’ The final scope, definitions of ‘qualifying’ income, and conditions will be confirmed only upon publication in the Resmi Gazete. Treat the above as indicative, not final.
What the 20-year horizon would mean
A tax incentive window of up to 20 years is notably long. Many comparable regimes in Europe and elsewhere offer relief for a fixed and shorter period, often 10 or 15 years. A 20-year horizon, if confirmed, would allow an internationally mobile individual to plan around a stable long-term tax position rather than a short window that expires mid-plan.
Practical example, illustrative only: an entrepreneur with substantial foreign-source investment income who becomes a Turkish tax resident after the law enters into force could, under the regime as described, benefit from exemption on that qualifying foreign income for up to two decades, while any Turkish-source income would remain taxable under standard local rules. The actual outcome would depend entirely on the final published rules and on the individual’s specific income structure, which is why qualified cross-border tax advice is essential before acting.
Who the Regime Is Expected to Apply To
The regime is targeted at new tax residents, with specific conditions defining who qualifies.
The expected eligibility conditions
The regime is expected to apply to individuals who:
- Were not Turkish tax residents during the previous 3 years
- Obtain Turkish tax residency after the law enters into force
This is a familiar structure for incentive regimes designed to attract new residents rather than to benefit existing ones. The three-year look-back period is intended to ensure the incentive goes to genuinely new arrivals, not to individuals cycling in and out of tax residency to capture the benefit. The requirement that residency be obtained after the law enters into force is the reason the timing of publication in the Resmi Gazete matters so much: the regime cannot apply to anyone until it is officially in effect.
Who this profile typically describes
Regimes of this kind generally attract internationally mobile high-net-worth individuals, entrepreneurs preparing for or following a business exit, and executives with significant foreign-source income, who are choosing where to establish tax residency. For such individuals, a long exemption on foreign-source income can be a decisive factor in selecting a jurisdiction.
Turkiye’s added attraction is its position as a crossroads between Europe, the Middle East, and Asia, combined with its existing citizenship-by-investment program. An individual could potentially combine Turkish citizenship (through the existing CBI route) with tax residency under the new regime, though whether and how these interact would depend on the final published rules and on individual circumstances.
How It Would Compare to Other Regimes
If enacted as described, the Turkish regime would sit within a competitive landscape of tax-incentive jurisdictions, each with its own structure.
The regional and European context
Several jurisdictions offer incentives for new tax residents. Italy operates a flat-tax regime for new residents on foreign income. Greece offers a Non-Dom flat-tax structure. Portugal’s research-focused incentive (the successor to its former Non-Habitual Resident regime) offers targeted relief. The UAE offers a zero personal income tax environment without a time limit, though it requires genuine residency and presence.
Against this backdrop, the proposed Turkish regime’s distinguishing features would be the length of the exemption window (up to 20 years, longer than most fixed-period European regimes) and the 1% inheritance and gift tax rate, which is notably low. Whether Turkiye becomes a leading choice would depend on the final rules, the definitions of qualifying income, and how the regime interacts with double-taxation treaties and with each individual’s home-country tax obligations.
The caveat that matters most
This is residency-based relief, not a global exemption. Anyone taxed on worldwide income by their home country, including US citizens, would still face those obligations. A Turkish exemption is not automatically an overall exemption: it addresses Turkish tax treatment of qualifying foreign income, not the tax claims of other jurisdictions on the same income. Proper cross-border tax advice is essential before making any move, because the interaction between the Turkish regime, the individual’s home-country rules, and any applicable tax treaties determines the real outcome.
Practical example, illustrative only: a US citizen who becomes a Turkish tax resident under the regime would still owe US tax on worldwide income, because the US taxes its citizens regardless of where they live. The Turkish exemption would not change that. The regime is most relevant to individuals from countries that tax on a residency basis rather than a citizenship basis.
Why the Timing Matters: The Resmi Gazete
The single most important practical point about this regime is that it is not yet in force.
IMPORTANT: The law was approved by the Turkish Parliament on 21 May 2026 but has not yet been published in the Resmi Gazete, the Official Gazette of Turkiye. Until it is published and enters into force, the regime cannot apply to anyone, and its final terms are not confirmed. No one can obtain residency ‘under the new regime’ before it legally exists.
What publication in the Resmi Gazete means
In Turkiye, a law approved by Parliament becomes effective through publication in the Resmi Gazete, the Official Gazette. Until that publication, the approved package is not operative law. This matters for two reasons. First, the final published text may differ from the approved package in its definitions, conditions, or scope. Second, the eligibility condition that residency be obtained after the law enters into force means the timing of publication directly determines who can qualify and when.
For anyone considering Turkiye on the strength of this regime, the practical implication is to prepare but not to act prematurely. Establishing tax residency before the law is in force, or on assumptions about its final terms that turn out to be wrong, could produce an outcome the individual did not intend. The correct posture is to monitor the publication closely and be ready to act precisely when the final text is confirmed.
What to do in the meantime
The sensible approach is preparation without commitment. Understand your current tax position, model how the regime would affect you if enacted as described, identify the conditions you would need to meet (the three-year non-residency look-back, the timing of obtaining residency), and have your cross-border tax advice in place so you can act decisively the moment the final text is published. This positions you to benefit from the regime if it enters into force as expected, without exposing you to the risk of acting on unconfirmed terms.
Frequently Asked Questions
Is the new Turkish tax regime in force now?
No. The Turkish Parliament approved the reform package on 21 May 2026, but the law is not yet in force. It is awaiting publication in the Resmi Gazete, the Official Gazette of Turkiye. Until it is published and enters into effect, the regime cannot apply to anyone, and its final terms are not confirmed. This is the single most important fact to understand before acting.
How long would the tax exemption last?
As described in the approved package, the regime may provide exemption from taxation on qualifying foreign-source income and certain foreign capital gains for up to 20 years. This is notably longer than many comparable European regimes, which typically run for 10 or 15 years. However, the final duration and conditions will be confirmed only upon publication in the Resmi Gazete, so the 20-year figure should be treated as indicative until the law is officially in force.
Who would qualify for the regime?
The regime is expected to apply to individuals who were not Turkish tax residents during the previous three years and who obtain Turkish tax residency after the law enters into force. The three-year look-back is designed to direct the incentive to genuinely new residents. The requirement that residency be obtained after the law is in force is why the timing of publication matters so much for eligibility.
Would this eliminate all my taxes?
No. The regime is residency-based relief, not a global exemption. Turkish-source income would continue to be taxed under standard local rules. More importantly, anyone taxed on worldwide income by their home country, including US citizens, would still face those obligations regardless of the Turkish regime. A Turkish exemption addresses Turkish tax treatment of qualifying foreign income; it does not override other countries’ tax claims. Cross-border tax advice is essential to understand the real, combined outcome for your situation.
Should I move to Turkiye now to benefit?
Not yet, and not without advice. Because the law is not in force, and because the eligibility condition requires obtaining residency after it enters into force, acting prematurely could produce an unintended outcome. The sensible approach is to prepare: understand your position, model the impact, line up cross-border tax advice, and be ready to act when the final text is published in the Resmi Gazete. Acting on unconfirmed terms carries real risk.
Can I combine this with Turkish citizenship?
Turkiye operates an existing citizenship-by-investment program, and in principle an individual could hold Turkish citizenship and also establish tax residency under the new regime. However, whether and how the two interact, and whether citizenship affects eligibility for the residency-based tax relief, would depend on the final published rules and on individual circumstances. This is precisely the kind of question to resolve with qualified advice before acting, not to assume.
Where can I follow the final outcome?
The definitive source is the Resmi Gazete, the Official Gazette of Turkiye, where the law will be published when it enters into force. The final published text is what governs; commentary and summaries (including this one) describe the approved package, which may change. We are watching the publication closely and will be ready to advise the moment the final text is confirmed.
The Honest Conclusion
If enacted as approved, Turkiye’s new tax incentive regime would be a genuinely competitive offering: up to 20 years of relief on qualifying foreign-source income, a 1% inheritance and gift tax rate, and no obligation to declare qualifying foreign income, all aimed at attracting new tax residents to a country that sits at the crossroads of Europe, the Middle East, and Asia.
But the regime is not yet law. It was approved on 21 May 2026 and awaits publication in the Resmi Gazete. Its final terms are not confirmed, and it cannot apply to anyone until it is officially in force. The right posture is informed preparation, not premature action: understand how it would affect you, line up proper cross-border tax advice, and be ready to act precisely when the final text is published.
IMPORTANT: To restate clearly: the law described in this article is not yet in force. It was approved by the Turkish Parliament on 21 May 2026 and is awaiting publication in the Resmi Gazete. The provisions described may change before they take effect. This article is general information, not tax or legal advice. Always obtain qualified cross-border tax advice for your specific situation before making any decision.
Your Next Step
Soland is monitoring the publication of this regime in the Resmi Gazete closely. If you want to understand how the regime would affect your specific situation, and to be positioned to act the moment the final text is confirmed, a Pre-Qualification consultation can model the impact against your current tax position and goals, in coordination with qualified cross-border tax advisors.
Save this update and book a consultation if you want to be ready to act the moment the final text is confirmed. Soland does not provide tax advice directly; we coordinate the right specialists and structure around your situation. We help families build the right cross-border structure for the next twenty years. Get in touch through solandworld.com or contact our advisory team directly.
