Financial Planning for Expats in Turkey: The Complete Guide

Turkey for internationally mobile HNW individuals

Turkey occupies a unique position at the intersection of Europe, the Middle East, and Central Asia. Istanbul is one of the world's great cities — a megacity of 16 million people that bridges continents, with a sophisticated financial and cultural infrastructure, a vibrant arts scene, and an intensely competitive commercial environment. Antalya, Bodrum, and the Aegean coast have for decades attracted foreign buyers of holiday homes, and in recent years the citizenship-by-investment programme has brought a new wave of HNW foreign purchasers from the Gulf, Eastern Europe, Russia, and beyond.

For internationally mobile individuals, Turkey offers scale, connectivity, and a real estate market where prime-quality assets can still be acquired at prices that compare favourably to Western European equivalents. But Turkey also presents significant risks: the Turkish Lira has experienced extraordinary volatility, inflation has been structurally elevated, and the political environment has been unpredictable. Any serious financial plan for Turkey must place these risks at the centre, not the margin.

Citizenship by investment

Turkey's citizenship-by-investment programme is one of the most straightforward routes to a second passport globally and is the primary driver of HNW foreign real estate investment in the country.

The requirement is a minimum real estate acquisition of USD 400,000 (or equivalent in foreign currency or TRY at the official rate) in qualifying property. The property must be held for a minimum of three years — a mortgage or lien preventing transfer is acceptable provided the USD 400,000 equity threshold is met. Multiple properties can be combined to reach the threshold.

The process is managed by the Directorate General of Population and Citizenship Affairs, with property registration handled through the Title Deed Registry. Processing times are typically three to six months from a complete application. Citizenship extends to the applicant's spouse and dependent children under 18.

The Turkish passport gives visa-free or visa-on-arrival access to approximately 110 countries, including Singapore, Japan, South Korea, and a range of jurisdictions in Asia, Africa, and Latin America that are important for global investors. It does not give visa-free access to the Schengen zone or the United Kingdom, which limits its utility as a travel document for those already holding a strong Western passport — but for nationals of countries with weaker travel documents, Turkish citizenship provides a meaningful upgrade.

Important: Turkish law requires Turkish citizens to renounce citizenship of countries that do not permit dual nationality — however, Turkey does not enforce this for foreign nationals who naturalise as Turkish citizens and retain their original citizenship in their home country. Many investors obtain Turkish citizenship while retaining their original passport without renouncing either. Legal advice specific to your home jurisdiction's dual nationality rules is essential.

Residence and visas

Turkish citizenship obviously confers full residence rights. For non-citizens:

• Short-stay residence permits are available for property owners for up to two years.
• Long-term residence permits (ikamet) are available after eight years of legal residence on short-term permits, or in certain other qualifying circumstances.
• Work permits are required for employment by a Turkish employer.

Many foreign nationals who purchase Turkish property but do not reside full-time use their Turkish home as a second residence, visiting on an e-visa (90 days in 180 days for most nationalities) without a formal residence permit.

The Turkish tax system

Turkey levies income tax on a progressive scale of five bands — 15%, 20%, 27%, 35% and 40% — with the top 40% rate applying to the highest band. The TRY thresholds at which each band begins are re-indexed every year for inflation (for 2026 the entry threshold was raised by around 25%), so the bracket figures shift substantially year to year; confirm the current-year thresholds with the Turkish Revenue Administration (Gelir İdaresi Başkanlığı). Given the scale of TRY inflation in recent years, nominal thresholds increase annually but real bracket progressivity has been volatile.

Tax residence in Turkey arises if an individual is domiciled in Turkey or spends more than six consecutive months in Turkey during a calendar year. Tax residents are taxed on worldwide income. Non-residents are taxed only on Turkish-source income.

For most internationally mobile HNW individuals who own property in Turkey but spend fewer than six consecutive months there, the default position is non-resident, and only Turkish-source income (rental income from Turkish property, dividends from Turkish companies) is within scope of Turkish tax. This is a meaningful distinction.

Capital gains on property: gains from the disposal of real estate held for fewer than five years are taxed as ordinary income (subject to progressive income tax rates). Gains on property held for five or more years are exempt from Turkish income tax. This is the principal reason serious investors plan around a five-year minimum hold. The exemption applies to individuals; corporate holding structures may be treated differently.

Rental income from Turkish property is taxable in Turkey. There is a lump-sum deduction available (a deemed expenses rate of 15% of rental income for unfurnished residential property) or alternatively the taxpayer can deduct actual expenses. The rental income threshold below which no tax is due is relatively low.

The Turkish Lira: the central risk

No discussion of financial planning in Turkey can avoid the Turkish Lira (TRY). The lira has lost approximately 75% of its value against the USD between 2018 and 2024. Turkish inflation reached 85% in 2022, fell back, and has remained structurally elevated. The Central Bank of Turkey raised interest rates sharply from mid-2023 under a new monetary policy direction, which has helped stabilise the currency — but the long-term depreciation trend has been severe.

For GBP or EUR-earning investors, the practical implications are:

• Turkish Lira-denominated rental income, when converted to GBP or EUR, is worth substantially less than it was at the time of purchase.
• USD or EUR-denominated rental income — which is available in Istanbul's prime residential and commercial markets, and in tourist areas — provides a natural hedge.
• TRY-denominated savings and deposits lose real value rapidly in an inflationary environment.
• Property prices in TRY have risen sharply in nominal terms, but gains measured in USD or EUR are more modest.

The clear recommendation for HNW investors is: structure Turkish real estate income in USD or EUR where possible, hold core savings and investments outside Turkey in hard currencies, and treat TRY exposure as a managed risk rather than a core portfolio position.

The property market for foreign investors

The Turkish real estate market is segmented. Istanbul's prime residential market — districts such as Nişantaşı, Bebek, Etiler, and Bosphorus-facing locations in Beşiktaş, Sarıyer, and Üsküdar — operates at a fundamentally different level from the mass-market new development sector in peripheral urban areas. Prime Istanbul is driven by local and international wealth; it has been resilient in USD terms even as the broader market has fluctuated in lira terms.

Beyond Istanbul, foreign buyers concentrate in Antalya (particularly Lara and the Konyaaltı coastal strip), Alanya, Bodrum, and Fethiye. These are markets dominated by holiday home buyers and retirement-focused investors, with strong short-term rental demand in season but more limited year-round liquidity.

Transaction costs: Turkish real estate transactions attract a title deed fee of 4% of declared value (split between buyer and seller or borne by buyer by convention), VAT (exempt for second-hand residential property; charged at 1–20% for new builds), and notary/agent fees. The declared value for title deed purposes has historically differed from actual transaction prices, though authorities have tightened scrutiny.

The UK/Turkey Double Taxation Agreement

A comprehensive DTA exists between the UK and Turkey. Key provisions:

• Employment income is taxed where the duties are performed, with relief in the country of residence.
• Pensions: private pensions are generally taxable in the country of residence. Government service pensions (UK civil service, armed forces, NHS, teachers, etc.) are taxed exclusively in the UK under the Government Service Article, regardless of where the recipient is resident.
• Capital gains: gains on Turkish real estate are taxable in Turkey; gains on UK real estate are taxable in the UK. Gains on other assets (shares, etc.) are generally taxable in the country of residence.
• Dividends and interest: taxed primarily in the country of residence, with limited withholding at source.

The DTA is a meaningful protection for UK nationals with Turkish real estate income or those considering Turkish residence, and should be analysed carefully alongside both domestic tax systems.

Banking in Turkey

Major Turkish banks include Garanti BBVA, İş Bankası (İşbank), Akbank, and Yapı Kredi. These are large, well-capitalised institutions with English-language services for foreign clients.

Foreign nationals can open Turkish bank accounts in both TRY and foreign currency (USD, EUR) upon presenting a passport and Turkish tax identification number (vergi kimlik numarası). The tax ID is easily obtained from any tax office.

Foreign currency accounts held at Turkish banks are not subject to exchange controls — Turkey does not restrict foreign currency deposits or transfers. However, certain international transfers — particularly involving TRY — have encountered delays in correspondent banking relationships due to sanctions-related screening.

Wise and Revolut are widely used for international transfers and as day-to-day spending tools. For large transactions (property purchases, substantial investment transfers), bank-to-bank transfers through regulated Turkish banks with full documentation are standard.

Cross-border estate planning

For UK nationals or internationally mobile individuals who own Turkish real estate, the succession and estate planning implications require attention:

• Turkish inheritance law (Turkish Civil Code) governs the succession of Turkish real estate, regardless of the nationality or domicile of the owner.
• Turkish inheritance tax applies to Turkish assets.
• The UK/Turkey DTA does not contain specific provisions on inheritance tax; the interaction of UK IHT and Turkish inheritance tax on cross-border estates must be managed separately.
• An international will covering Turkish assets, and a clear understanding of Turkish forced heirship rules (which protect children's shares), are advisable.

How Global Investments can help

Global Investments advises HNW investors on the full financial planning picture surrounding Turkish property investment and residency, including citizenship-by-investment structuring, income and CGT planning under the UK-Turkey DTA, lira risk management, and cross-border estate planning for Turkish assets. We work with trusted Turkish legal and tax counsel on domestic matters and coordinate the overall strategy with your UK and international planning.

Whether you are considering a Turkish property acquisition for investment, lifestyle, or citizenship purposes, contact us to understand the complete financial picture before committing.

This guide is for general information only and does not constitute tax, legal, or financial advice. Turkish and UK tax rules, and the citizenship-by-investment programme terms, can change; seek professional advice specific to your circumstances before acting.