Client Information Note: Türkiye’s New Tax and Investment Incentives for Attracting Foreign Investors

Date: 01 June 2026
Subject: New tax incentives for foreign investors, multinational corporate groups, exporters, service centres and individuals relocating to Türkiye

Important Note on the Current Legal Status

Two separate legal developments must be distinguished in relation to Türkiye’s new investment and tax incentive framework:

Presidential Decision No. 11257 was published in the Turkish Official Gazette (Resmî Gazete) on 30 April 2026. It increased the deduction available for profits derived from certain services provided from Türkiye to foreign recipients to 100%. This measure applies to income and profits relating to tax periods beginning on or after 1 January 2026.
Law No. 7582 on the Amendment of Certain Laws was adopted by the Grand National Assembly of Türkiye (Türkiye Büyük Millet Meclisi – TBMM) on 21 May 2026. As of 25 May 2026, the TBMM’s official legislation page records the adoption of the Law and its transmission to the Presidency on 21 May 2026, but does not yet specify an Official Gazette publication date or number. Accordingly, the sections of this note relating to Law No. 7582 are based on the final text adopted by Parliament; the applicability of individual provisions remains subject to publication and the relevant entry-into-force clauses.

1. Overview

Türkiye’s new incentive framework is designed to strengthen its attractiveness for foreign investors, multinational corporate groups, technology-oriented businesses and internationally mobile individuals.

The new regime is not limited to conventional manufacturing investments. Taken as a whole, the measures seek to position Türkiye as:

a production and export base;
a centre for high-value service exports;
a regional management and coordination hub;
a location for international trading and transit trade activities;
a finance and operations hub through the Istanbul Finance Center; and
an attractive relocation jurisdiction for international investors and entrepreneurs.

Particularly significant elements include the newly introduced regime for Qualified Service Centres (Nitelikli Hizmet Merkezi), incentives for transit trade, the reduced 12.5% corporate income tax rate for qualifying manufacturing activities, the 20-year exemption for foreign-source income of newly relocating individuals, and the expansion of incentives available within the Istanbul Finance Center.

2. Key Changes Compared with the Initial Programme Announcement

Initial Programme Announcement	Position under the Adopted or Confirmed Legal Framework
A 9% corporate income tax rate had been announced for manufacturing exporters.	The adopted text provides for a 12.5% corporate income tax rate for corporations holding an industrial registration certificate and actually engaged in manufacturing, in respect of income exclusively derived from manufacturing activities, as well as for qualifying agricultural production income.
A general 14% corporate income tax rate had been mentioned for exporters.	The adopted text does not contain a general 14% corporate income tax rate for exporters in that form.
Regional management centres were presented as a general incentive category.	The adopted text introduces the specific concept of a Qualified Service Centre, subject to defined statutory conditions.
The full tax benefit for certain service exports was still at the announcement stage.	A 100% deduction for profits from certain qualifying service exports has already been implemented through Presidential Decision No. 11257.
Tech Visa and digital incorporation were presented as core elements of the overall investment strategy.	These remain relevant to the broader investment environment, but they are not at the centre of the main tax incentive provisions introduced by Law No. 7582.

3. Corporate Income Tax Rate of 12.5% for Manufacturing and Agricultural Production Activities

Under the text of Law No. 7582 adopted by Parliament, corporations holding a Turkish industrial registration certificate and actually carrying out manufacturing activities will be subject to a 12.5% corporate income tax rate in respect of profits derived exclusively from those manufacturing activities.

The same rate will apply to corporate profits derived from qualifying agricultural production activities.

The provision is intended to apply to profits generated in tax periods beginning in 2027. For companies with a special accounting period, it is intended to apply to accounting periods beginning during the 2027 calendar year.

3.1. Significance for Foreign Investors

The new rate may be particularly relevant for foreign investors planning to establish or expand manufacturing capacity in Türkiye.

The incentive may be of interest in sectors including:

textiles and apparel;
automotive manufacturing and automotive components;
machinery and equipment;
electrical and electronic products;
chemicals and plastics;
food processing;
defence industry; and
advanced technology and industrial manufacturing.

3.2. Limitations and Practical Considerations

The 12.5% rate does not automatically apply to all profits of a company. It is limited to profits attributable to the qualifying manufacturing or agricultural production activity.

Companies engaged in multiple activities, such as manufacturing, trading, exports and services, will therefore need reliable accounting mechanisms to separate qualifying income from non-qualifying income.

Furthermore, profits benefiting from the reduced manufacturing rate may not also benefit from the existing five-percentage-point corporate income tax reduction applicable to export income. Companies combining manufacturing and export activities should therefore analyse the optimal application of the available regimes before implementation.

4. 100% Deduction for Certain Service Export Profits

Presidential Decision No. 11257, published in the Official Gazette on 30 April 2026, increased the deduction available for profits derived from certain services provided from Türkiye to foreign recipients to 100%.

This measure applies to tax periods beginning on or after 1 January 2026.

4.1. Potentially Qualifying Services

The regime may cover, in particular:

architectural services;
engineering services;
design services;
software development;
medical reporting;
bookkeeping services;
call centre services;
product testing;
certification services;
data storage;
data processing;
data analysis;
certain vocational training services; and
specified education and healthcare services subject to the relevant permits and supervision.

4.2. Principal Requirements

Requirement	Explanation
Foreign customer	The service must be provided to individuals not resident in Türkiye or to entities whose statutory seat and place of effective management are outside Türkiye.
Use outside Türkiye	The service must be utilised exclusively outside Türkiye.
Qualifying service type	The activity must fall within the categories covered by the applicable legislation and implementing rules.
Transfer to Türkiye	The entire amount of the qualifying profit must be transferred to Türkiye by the deadline for filing the relevant annual income or corporate income tax return.
Separation of income	Domestic or otherwise non-qualifying income must be separately determined and documented.

4.3. Practical Relevance

This measure may be particularly attractive for investors establishing a Turkish entity to provide services to foreign customers in areas such as:

software development;
engineering;
data processing and analytics;
international support and call centre operations; and
medical or technical reporting.

However, the measure should not be understood as a general exemption for all international service activities. Eligibility will depend on the specific nature of the service, the customer profile, the place where the service is utilised, the contractual arrangements, invoicing and the timely transfer of qualifying profits to Türkiye.

5. New Legal Concept: Qualified Service Centre

One of the most significant innovations of Law No. 7582 for multinational corporate groups is the introduction of the Qualified Service Centre regime (Nitelikli Hizmet Merkezi).

Under the adopted text, a Qualified Service Centre is a capital company established to provide services to related companies or a corporate group actively operating in at least three different countries, provided that at least 80% of its annual turnover is generated from services supplied to related companies located outside Türkiye.

5.1. Basic Conditions

Criterion	Requirement
Legal form	The centre must be incorporated as a capital company.
International group structure	The related companies or corporate group must be actively operating in at least three different countries.
Service recipients	Services must be provided to related companies located outside Türkiye.
Turnover threshold	At least 80% of annual turnover must be generated from services supplied to related foreign companies.

5.2. Potential Activities

A Qualified Service Centre may perform functions including:

financial advisory services;
strategic management advisory services;
risk management;
cash and liquidity management;
financing and debt coordination;
investment and capital structure planning;
budgeting, financial reporting and analysis;
international accounting and compliance functions;
audit and control activities;
digital transformation and technology advisory services;
data analysis and investment advisory services;
human resources and training services;
brand management and promotional coordination;
after-sales support;
technical support; and
coordination of research and development, product testing and laboratory activities.

To the extent that services relate to Turkish law or domestic legal matters, legal advisory services must be provided in compliance with Turkish professional rules, in particular through lawyers or law partnerships authorised under the Turkish Attorneyship Act.

6. Tax Incentives for Qualified Service Centres

The adopted legislation provides for substantial corporate income tax advantages for Qualified Service Centres.

Location of the Qualified Service Centre	Deductible Portion of Qualifying Profits
Qualified Service Centre generally operating in Türkiye	95%
Qualified Service Centre operating in the Istanbul Finance Center	100%
Qualified Service Centre operating in certain industrial zones designated by the President	100%

The deduction applies to profits earned exclusively from abroad within the scope of the qualifying activity.

A principal condition is that the relevant profits must be transferred to Türkiye by the deadline for filing the corporate income tax return for the relevant accounting period.

The incentive is intended to apply for 20 accounting periods from the accounting period in which the Qualified Service Centre commences operations. The relevant deductions are also available in the calculation of the tax base for Türkiye’s domestic minimum corporate income tax regime.

6.1. Income Tax Incentives for Qualified Personnel

Income tax incentives are also provided for qualified personnel directly performing services within a Qualified Service Centre.

Place of Employment	Tax-Exempt Portion of Remuneration
General Qualified Service Centre	Up to three times the gross minimum wage
Qualified Service Centre in the Istanbul Finance Center	Up to five times the gross minimum wage
Centre in certain designated industrial zones	Up to five times the gross minimum wage

Support and auxiliary staff will not be treated as qualified service personnel for these purposes.

6.2. Significance for International Corporate Groups

The regime may be highly relevant for multinational groups seeking to centralise regional functions relating to Europe, the Middle East, Central Asia, the Caucasus or Africa in Türkiye.

Potential centralised functions include:

treasury and financing;
international controlling;
group reporting;
compliance and risk management;
technical support;
procurement and supply-chain coordination;
human resources and training; and
digital transformation and data analytics.

Before implementation, a group should analyse transfer pricing, functional and risk allocation, substance requirements, permanent establishment risks and the potential impact of global minimum taxation rules.

7. Expanded Incentives for Transit Trade Activities

Law No. 7582 also introduces significant incentives for international transit trade activities.

The incentive is intended to cover profits derived from purchasing goods abroad and reselling them abroad without importing the goods into Türkiye, as well as profits derived from acting as an intermediary in comparable foreign goods trading transactions.

Location of Activity	Deductible Portion of Transit Trade Profits
General transit trade activity	95%
Transit trade through the Istanbul Finance Center	100%
Transit trade in certain industrial zones designated by the President	100%

7.1. Conditions

The principal conditions for benefiting from the incentive are intended to include:

the goods must not be brought into Türkiye;
both the seller and the buyer must be located outside Türkiye; and
the profit must be transferred to Türkiye by the deadline for filing the corporate income tax return for the relevant accounting period.

The rule is intended to apply to corporate profits relating to tax periods beginning on or after 1 January 2026, for tax returns required to be submitted from 1 July 2026 onwards, subject to publication and entry into force of Law No. 7582.

7.2. Importance for Investors

This incentive may be relevant for:

international trading companies;
intra-group purchasing and distribution companies;
commodity and goods trading companies;
regional supply-chain management companies; and
trading groups active between Europe, the Middle East, Central Asia and Africa.

For practical implementation, particular attention should be given to contractual structures, transfer pricing, banking arrangements, anti-money laundering compliance, beneficial ownership transparency, economic substance and any effects of global minimum taxation.

8. Expanded Benefits of the Istanbul Finance Center

Law No. 7582 also expands the existing incentive framework applicable to the Istanbul Finance Center.

Area	New Incentive
Transit trade profits generated within the Istanbul Finance Center	100% deduction
Profits of a Qualified Service Centre operating in the Istanbul Finance Center	100% deduction
Income tax benefit for employees of a Qualified Service Centre in the Istanbul Finance Center	Up to five times the gross minimum wage
Profit deduction for exported financial services	Extension of the existing temporary 100% deduction period until 31 December 2047.
Duration of the financial services export incentive	Extension until 31 December 2047
Fee exemption for financial activities	Extension from five years to twenty years
Income tax benefits for employees	Extension of scope from financial institutions to all participants in the Istanbul Finance Center

The objective is to make the Istanbul Finance Center attractive not only for banks and financial institutions, but also for regional management, intra-group services, international trading and financing operations of multinational groups.

9. Twenty-Year Exemption for Foreign-Source Income of Newly Relocating Individuals

Law No. 7582 is directed not only at corporate investors but also at individuals considering relocating their tax residence to Türkiye.

Under the new regime, individuals who become resident in Türkiye and who did not have a residence or disqualifying tax liability in Türkiye during the preceding three calendar years will be exempt from Turkish income tax on their income and gains derived outside Türkiye for a period of 20 years.

The rule is intended to apply to persons becoming resident in Türkiye on or after 1 January 2026, subject to publication and entry into force of the Law.

9.1. Principal Conditions and Consequences

Topic	Rule
Eligible persons	Individuals newly relocating to Türkiye who had no residence or disqualifying tax liability in Türkiye during the preceding three calendar years
Scope of exemption	Income and gains derived outside Türkiye
Duration	20 years
Turkish-source income	Continues to be taxed under the general rules
Certain previous Turkish income	Earlier tax liability arising from specified rental income, investment income or capital gains should not necessarily prevent access to the regime
Tax return treatment	Exempt foreign-source income will not be required to be included in an annual Turkish income tax return
Foreign taxes paid	Foreign taxes relating to exempt income cannot be credited against Turkish income tax
Subsequent failure to meet conditions	Taxes not collected may subsequently be assessed as tax loss if it is established that the conditions were not satisfied

9.2. Inheritance Tax Benefit

Where a person benefiting from the regime dies during the 20-year exemption period, assets transferred through inheritance will be subject to a flat inheritance tax rate of 1%.

9.3. Practical Significance

The regime may be of particular relevance to:

Turkish citizens living abroad;
foreign entrepreneurs and investors;
international founders;
individuals holding foreign company participations, portfolios or dividend-generating investments;
families with internationally structured wealth; and
individuals considering relocating their residence and wealth management activities to Türkiye.

Before relocation, it will be necessary to analyse tax residence, any exit taxation in the former country of residence, double taxation treaties, controlled foreign company rules, foreign trusts or foundation structures, and succession planning.

10. Expanded Employee Share Incentives for Technology Startups

Law No. 7582 also broadens the tax advantages available for employee share participation arrangements in technology startups.

The regime concerns benefits received by employees through the gratuitous or discounted acquisition of shares or equity interests.

Topic	Previous Framework	New Rule
Maximum tax-exempt amount	Employee’s annual gross remuneration	Employee’s gross remuneration for two years
Holding period required for full exemption	12 years	6 years

Where shares are disposed of before the expiry of the required holding period, the following clawback mechanism is intended to apply:

Time of Disposal	Clawback of Previously Exempt Tax
Within the first two years	100%
Between two and four years	75%
Between four and six years	25%
After six years	No clawback

This measure may be relevant for foreign investors and founders establishing technology-oriented businesses in Türkiye and seeking to attract or retain qualified employees through equity-based incentive plans.

11. Investor Guidance Table

Investor Profile	Potential Incentive	Key Condition or Risk
Foreign company establishing manufacturing operations in Türkiye	12.5% corporate income tax rate	Industrial registration certificate, actual manufacturing activity and proper segregation of income
Company providing software, engineering or data services from Türkiye to foreign customers	100% deduction for certain service export profits	Qualifying service, use outside Türkiye and timely transfer of profits to Türkiye
Multinational corporate group	Qualified Service Centre regime	Active operations in at least three countries and at least 80% foreign related-party turnover
Regional purchasing or sales centre	95% or 100% deduction for transit trade profits	Goods must not enter Türkiye, foreign parties and transfer requirement
Company operating in the Istanbul Finance Center	100% deductions and additional IFC benefits	Satisfaction of participant and qualifying activity requirements
Individual planning to relocate to Türkiye	20-year exemption for foreign-source income	No disqualifying Turkish residence or tax status during the preceding three years
Technology startup	Tax-efficient employee equity participation	Proper structuring of the participation plan and compliance with holding periods

12. Initial Review Questions for Clients

A. Companies and Corporate Groups

Review Area	Key Question
Business model	Does the investment relate to manufacturing, service exports, transit trade or a regional service centre?
Selection of incentive regime	Would the manufacturing tax rate, service export deduction, Qualified Service Centre regime or establishment in the Istanbul Finance Center be most beneficial?
Segregation of income	Can qualifying and non-qualifying income be reliably separated in the accounting records?
Transfer of profits	Can qualifying profits be transferred to Türkiye within the statutory deadline?
Location choice	Could establishment in the Istanbul Finance Center or a designated industrial zone provide access to a 100% deduction?
Group structure	Does the corporate group meet the conditions for a Qualified Service Centre?
Transfer pricing	Are intra-group services and financing arrangements structured on an arm’s length basis?
Global minimum taxation	Could Pillar Two rules reduce or neutralise the economic benefit of the incentive?
Compliance	How will accounting, tax filings, beneficial ownership, AML and banking requirements be implemented?

B. Individual Investors

Review Area	Key Question
Tax residence	From what date would the individual be treated as resident in Türkiye?
Three-year condition	Did the individual have any disqualifying residence or tax status in Türkiye during the preceding three calendar years?
Source of income	Is the relevant income Turkish-source or foreign-source income?
Participation and portfolio structure	Would foreign dividends, participation income or portfolio gains fall within the exemption?
Succession planning	How could the 1% inheritance tax rate affect family wealth planning?
Foreign taxation	What taxation remains applicable in the source state or former state of residence?

13. Legal and Tax Assessment

The new incentive framework materially changes Türkiye’s value proposition for foreign investors.

Whereas earlier incentive models focused predominantly on manufacturing and exports, the new provisions expressly include:

regional management and support functions of multinational groups;
international trade and supply-chain structures;
high-value service exports;
financial services;
technology-oriented ventures; and
the relocation of international investors and high-net-worth individuals.

Access to these benefits will not be automatic. In particular, investors will need to ensure:

an appropriate corporate and tax structure;
accurate separation of qualifying income;
arm’s length structuring of intra-group transactions;
timely transfer of qualifying profits to Türkiye;
sufficient economic substance and personnel arrangements; and
continuous monitoring of implementing regulations and administrative practice.

Large multinational groups should additionally assess whether the benefit of low effective Turkish tax rates may be partly neutralised by international global minimum taxation rules, in particular Pillar Two.

14. Conclusion and Recommended Action

Türkiye’s new investment and tax incentive architecture is more than a package of individual tax reductions. It represents an attempt to reposition Türkiye as an international centre for manufacturing, service exports, regional corporate management, transit trade, financial services and qualified international capital.

An initial review is particularly recommended for:

foreign companies planning manufacturing investments in Türkiye;
companies intending to provide software, engineering, data or healthcare services from Türkiye to foreign customers;
multinational groups seeking to centralise regional functions for Europe, the Middle East, Central Asia or Africa;
international trading companies considering structuring transit trade or intra-group supply-chain operations through Türkiye;
businesses assessing establishment in the Istanbul Finance Center;
individuals considering relocating to Türkiye and managing foreign-source income from Türkiye; and
technology-oriented companies seeking to attract or retain qualified employees through equity participation arrangements.

Recommendation: Before any investment, relocation or restructuring decision is taken, an individual structuring analysis should be prepared for the relevant client. Such analysis should address the business model, suitable corporate structure, applicable incentive regime, tax consequences, economic substance requirements, transfer pricing, international tax implications and implementation of ongoing compliance obligations.