Parliament has passed one of the longest tax exemptions for new residents anywhere in Europe — twenty years, no annual fee. Here's who qualifies, where the catches are, and how it stacks up against Italy, Greece and the Gulf.
On 21 May 2026, Turkey's parliament passed a tax package built to pull globally mobile money into the country. The headline measure is a twenty-year exemption from Turkish income tax on foreign-source income for people who move to Turkey and become tax residents. It was proposed by President Erdoğan as part of a wider investment programme announced in April.
One detail worth getting right before anyone packs a bag: as of early June the law had cleared parliament but had not yet been published in the Official Gazette, which is the step that brings it into force. The president has fifteen days from passage to sign and publish it, and since he initiated the package himself, that's a formality rather than a real obstacle. Treat the in-force date as imminent and confirm against the Gazette before acting. Some of the finer points also depend on secondary regulations that hadn't been issued yet.
With that caveat in place, here's what the law actually does.
What the exemption covers
The measure adds a new article — 20/D — to Turkey's Income Tax Law No. 193. Qualifying individuals who become Turkish tax residents from 1 January 2026 onward are exempt from Turkish income tax on their foreign-source income, and on foreign capital gains, for twenty years from the point they settle. That foreign income doesn't even need to appear on a Turkish tax return.
Twenty years is the part that turned heads. Most of the comparable European regimes run for ten or fifteen. Turkey has gone roughly double, and unlike the others it doesn't ask for a fixed annual payment in exchange.
Income earned inside Turkey is a different matter. That stays taxable at the standard progressive rates, which run from 15 percent to 40 percent. The exemption is for money made abroad, not for setting up a local business and paying nothing.
Who qualifies
The gate is your recent tax history, not your wealth.
To be eligible you must not have had a registered domicile in Turkey, and not have been liable for Turkish tax, during the three calendar years immediately before you relocate — so for someone moving now, that means clean of Turkish tax residency across 2023, 2024 and 2025. The regime is aimed squarely at newcomers and returning Turks who have genuinely been based elsewhere.
There's one sensible carve-out. If your only previous Turkish tax exposure came from owning Turkish real estate, or from Turkish investment income or capital gains, that alone won't disqualify you. In other words, having bought an Istanbul apartment a few years ago doesn't lock you out of the exemption now.
Where the catches are
A twenty-year, fee-free exemption sounds frictionless. A few details temper that.
You can't deduct expenses tied to the exempt foreign income against your Turkish taxable income, and you can't credit foreign tax paid on that income against any Turkish tax. For most people living off genuinely foreign earnings that's irrelevant, but it matters if your affairs straddle the border.
The bigger open question is what counts as "foreign-source" in the first place. The law leaves the practical definition to secondary regulations, and the case everyone is watching is the remote worker: if you physically sit in Istanbul and invoice clients abroad, is that foreign income or Turkish income? Until the regulations land, that's genuinely unsettled, and it's the difference between a 0 percent and a 15-to-40 percent outcome for a lot of location-independent earners. Anyone in that position should wait for the detail rather than assume the friendly reading.
Then there's transparency. Turkey participates in the international financial-information exchange, so this is not a place to hide income — it's a place to legally not owe Turkish tax on it. Your home country's rules on exit and on controlled foreign companies will do more to determine whether you actually save anything than the Turkish exemption will.
The rest of the package
The twenty-year holiday is the retail headline, but the law carries more.
Inheritance and gift tax for people who qualify for the exemption drops to a flat 1 percent during the exemption period, against Turkey's normal graduated rates of 1 to 30 percent. There's a wealth amnesty letting individuals and companies declare foreign assets through 31 July 2027, at a standard 5 percent rate with reduced rates available under conditions. And the tax breaks for the Istanbul Finance Center have been extended out to 2047, part of a longer-run bid to make Istanbul a regional financial hub.
How it compares
Turkey isn't inventing the idea of a special tax deal for incoming residents. Italy, Greece and others have run versions for years. What's different is the combination of length and price.
| Regime | What's exempt | Duration | Annual cost | Main condition |
|---|
| Turkey (Art. 20/D) | All foreign income + foreign capital gains | 20 years | None | Not Turkish tax-resident in prior 3 years |
| Italy (flat-tax regime) | Foreign income | 15 years | €300,000 lump sum (2026) | Not resident 9 of prior 10 years |
| Greece (non-dom) | Foreign income | 15 years | €100,000 lump sum | New resident + Greek investment |
| Portugal (IFICI / "NHR 2.0") | Most foreign income; 20% on local pro income | 10 years | None | Work in a qualifying high-skill sector |
| UAE | No personal income tax at all | Indefinite | None | Become resident |
| Kazakhstan (AIFC programme) | Foreign income | While in the programme | ~$60,000 invested | 90-day residency via the AIFC |
Read across it and Turkey's position is distinctive. Italy raised its lump-sum charge to €300,000 a year in its 2026 budget, and Greece sets its own at €100,000; Turkey imposes no flat charge on foreign earnings at all. Portugal's replacement for the old NHR scheme, the IFICI regime, only opens its doors to highly qualified professionals in approved innovation and science fields, so it's far narrower than the headlines suggest. The UAE remains the simplest proposition of all, because it has no personal income tax to exempt you from in the first place — which is why, for many people, the Gulf is still the cleaner answer than any special regime.
Where Turkey wins is duration and reach for someone who isn't ultra-wealthy. You don't need €300,000 a year spare to make it work, and twenty years is long enough to plan a life around rather than a temporary arbitrage.
The citizenship angle
This is where it gets interesting for anyone already looking at Turkey's passport.
Turkey runs a citizenship-by-investment programme, most commonly accessed through a US$400,000 real-estate purchase. Until now, the tax side of that has been a quiet drawback: a Turkish citizen who becomes tax resident faces those 15-to-40 percent progressive rates on worldwide income. The new exemption removes that exposure for qualifying newcomers, so an investor who has never been a Turkish tax resident can, in principle, take the passport and the twenty-year foreign-income holiday together. Pairing a long tax exemption with a second passport elsewhere usually means juggling two jurisdictions; here the two sit in the same one, which makes Turkey's CBI more attractive than it was a month ago — provided the eligibility timing lines up.
Who it suits, and who it doesn't
It fits someone whose income genuinely comes from abroad — an entrepreneur with foreign companies, an investor living off an overseas portfolio, a retiree drawing foreign pensions and dividends — who hasn't been tax-resident in Turkey recently and is happy to actually live there or spend meaningful time.
It fits poorly if your income is really Turkish in substance (a local business, or remote work performed on Turkish soil that the regulations may treat as domestic), if you're American and therefore taxed by the US wherever you live, or if your home country has aggressive exit or controlled-foreign-company rules that follow you out the door.
It's worth saying plainly: the most important variable in whether this saves you money is your old country's tax system, not Turkey's generosity. The exemption is real. Whether you can actually use it is a question to put to an adviser who knows both jurisdictions.
Common questions
When does the exemption take effect? It was passed by parliament on 21 May 2026 but takes effect only once published in the Official Gazette, expected within days of passage. Confirm the published date before relying on it.
How long does it last? Twenty years from the point you become a qualifying Turkish tax resident — longer than Italy's or Greece's fifteen, and double Portugal's ten.
Do I have to pay an annual fee like in Italy? No. Unlike Italy's €300,000 and Greece's €100,000 lump sums, Turkey charges no flat annual fee on the exempt foreign income.
Is income I earn inside Turkey also exempt? No. Turkish-source income is still taxed at the standard 15 to 40 percent. Only foreign-source income and gains are covered.
What about remote work done from Turkey? Unresolved. Whether income earned while physically in Turkey counts as "foreign-source" is left to secondary regulations. Until those are published, location-independent earners should be cautious.
Can I combine it with Turkish citizenship? In principle yes. A CBI investor who has not been a Turkish tax resident in the prior three years could qualify for both the passport and the exemption.
This is general information, not tax advice. Whether the exemption benefits you depends heavily on your current country's exit and controlled-foreign-company rules, and several details still rest on secondary regulations Turkey had not issued at the time of writing. Take professional, jurisdiction-specific advice before relocating or restructuring anything. Figures and status are current as of June 2026.
By Erika Botnæs
