On April 24, 2026, President Recep Tayyip Erdoğan presented a comprehensive tax package in Istanbul. One of the most notable measures: anyone who newly settles in Turkey and has not been tax resident there in the past three years will pay no Turkish taxes on their foreign income for 20 years. Only income actually generated in Turkey remains taxable. Additionally, a flat inheritance and gift tax rate of one percent was announced. The legislative package still needs to pass parliament.
Many foreign income streams are already taxed in the country of origin. Anyone receiving rental income from Germany or dividends from Austria generally pays taxes there. Turkey has also concluded double taxation agreements (DTAs) with numerous countries. These determine which country holds the right to tax which income. In many cases, Turkey would not have had access to such income anyway.
A portion of the announced tax exemption therefore already exists for many people today, even without the new regulation.
The real value of the new regulation lies in three areas.
First, it creates legal certainty. Previously, much depended on case-by-case interpretation – which DTA applies, how income is classified, how the Turkish tax authority decides. The new regulation enshrines the tax exemption on foreign income into law for 20 years, without individual review.
Second, it covers income that is tax-free in the country of origin. Not all foreign income is automatically taxed where it arises. Capital gains from certain transactions, crypto profits, or licensing income are often not taxed in the country of origin – even though Turkey as the country of residence could previously have taxed them. The new regulation rules this out.
Third, there is the inheritance and gift tax. One percent flat is an independent advantage that has nothing to do with double taxation agreements. Particularly with larger wealth transfers, the difference compared to standard inheritance tax rates can be substantial.
A brief social perspective
Those who have lived, worked, and paid taxes in Turkey for years will naturally view this regulation differently. The impression that newcomers are being systematically favored is understandable. From an economic policy perspective, however, this model is not unusual. Countries like Portugal and Malta have been using similar incentives for years to attract capital and skilled individuals. The logic is not arbitrary unequal treatment, but a deliberate instrument in international competition for talent and investment. New residents may pay less tax on foreign income, but they consume and invest locally. Whether this calculation pays off will become clear in practice.
Turkey is merely the most recent example of a broader reality: international income structures are taxed very differently depending on place of residence, corporate structure, and applicable agreements. Those who understand their own tax situation can shape it. That is the real value of international tax planning.
Many internationally active individuals have never systematically reviewed their tax situation. A GmbH still registered in Germany, even though the owner has long since moved abroad. A holding structure that has gone unquestioned for years. A portfolio held in the wrong country. Each detail on its own is manageable – together, or over the years, they can result in a significant excess tax burden.
International tax planning means using legal instruments such as double taxation agreements, holding structures, and residency planning proactively – not reactively, but as part of a well-considered overall strategy.
The 20-year regulation sends a clear signal in international tax competition. Many details are still open, and the implementation will show what concretely comes of it. For whom it is truly relevant depends on individual circumstances.
The decisive question is rarely where you live, but whether your own tax structure still matches your reality.
Would you like to know whether your structure is still up to date? Get in touch with us. In an initial conversation, we will analyse your current setup together and show you where there is concrete need for action and what options are available to you.
