Türkiye has raised tax rates on deposit accounts and investment funds

Türkiye’s Treasury and Finance Ministry adjusted the taxation of financial investment instruments, increasing the tax rate on earnings from investment fund participation shares and deposit accounts to 15%. A presidential decree on the new tax adjustment was published in the Official Gazette and came into effect on Saturday. According to the new regulation, aimed at ensuring tax efficiency and aligning with the ministry’s principle of “taxing those who earn more at a higher rate,” the withholding tax rate on investment funds, previously set at 10%, has been raised to 15% for earnings from participation shares acquired from today onward. Earnings from participation shares acquired before the decision will continue to be taxed at the previously applicable rates. New deposit tax rates Effective immediately, withholding tax rates on interest and profit shares for newly opened or renewed term deposit/participation accounts are as follows:

• 15% for accounts with maturities of up to six months (including six-month terms),
• 12% for accounts with maturities of up to one year (including one-year terms),
• 10% for accounts with maturities exceeding one year.

Additionally, to address under-taxed areas, the withholding tax rates on interest and profit shares from foreign exchange-protected deposit and participation accounts (KKM) have been increased to align with other Turkish lira deposit accounts. The withholding tax rate remains at 0% for earnings from participation shares in equity-intensive funds and from venture capital and real estate investment funds held for more than two years.  Source: https://www.turkiyetoday.com/